Making your CSR activities relevant to your business sector

It is always heartening when a business puts thought into targeting its CSR activity to complement its operational activities.

A good example of this was recently given by Paul Walsh, who marks 10 years as CEO of Diageo this year. In an interview with the International Business Leaders Forum, Mr Walsh outlined the company's CSR activities, but also the logic behind them.

Diageo describes itself as a 'premium drinks business' which means that its products are more likely to be associated with Glyndebourne than Millwall Football Club. Its brands include Johnnie Walker, Smirnoff vodka and Tanqueray gin.

A key element of Diageo's production process is water use, and so the company has also adopted water scarcity as part of its CSR focus. In his interview, Mr Walsh said that water was a resource that was often taken for granted. However, as Diageo were constantly looking into new markets, it had become clear that a lack of clean water was one of the biggest barriers to economic development. The company has launched a '1 Million Challenge' with the aim of bringing clean water to one million people in Africa every year to 2015. This was in response to a challenge made by the UN that companies adopt a Millennium Development Goal. The seventh of these is to have the proportion of people without sustainable access to safe drinking water by 2015.

Mr Walsh said that his company's logic for this move lay in the fact that in order to do good business, he believed you had do good in the markets in which you work. He said this was also a source of pride for Diageo's employees. The company is increasingly finding that it needs to talk to many more groups of people than it had to previously. It used to have to communicate just with shareholders and customers, but now needs to engage with NGOs and communities as well.

It was also interesting to hear that Diageo's CSR strategy is also motivated by pragmatism. Mr Walsh is aware that regulators want more and more involvement in business, and to increase the amount of regulation. He knows that companies with decent CSR credentials, and good reputations and relationships with the communities in which they work stand more chance of getting a fair hearing from regulators.

What counts is that Diageo is putting its money where its mouth is in terms of CSR strategy. The company knows the areas in which it is gaining - both from the environment, and from communities and staff. Consequently, it is concentrating on giving back in those same areas via the '1 Million Challenge' and through reductions in water and energy usage.

Successful companies need to innovate and push themselves to improve and that includes improving the wellbeing of the societies in which they operate. Diageo has the sense to recognise that this has business as well as social benefits.

Photo credit: Greg Riegler