Corporate Social Responsibility and Environmental, Social, Governance are two phrases that appear to have a lot in common. Many organisations in 2022 are seeking to improve their business practices and have a positive impact on the planet. But what exactly is the difference between these two terms?
In short, CSR is the belief that organisations have a moral duty to do their best for the world around them. On the other hand, ESG is the steps an organisation takes to fulfil this duty and the results of their actions. Every company approaches these terms in their own way, but some key things stay the same:
Here are some of the main differences between CSR and ESG:
What is CSR?
CSR stands for Corporate Social Responsibility and is the belief that organisations have a responsibility to those around them. This means they should do their best to give back to those people. Ultimately, the hope of CSR is to make the world a better place.
CSR has been around for centuries. Many people hope their organisations can have a positive impact. At Convene, we sponsor the Herne Hill track league, because we value giving back to the local community as a positive in itself.
What is ESG?
ESG represents Environmental, Social, Governance and is about how your company performs in these areas. This states that an organisation’s sustainability is about more than just their impact on the environment. It is also about how their practices benefit their stakeholders and shareholders.
Of course, many ESG goals will support your company’s CSR. However, ESG is a more quantifiable term. Organisations should take active steps to monitor their analytics and targets.
Regardless of whether you want it to, your organisation will have an ESG history. A clear programme is about assessing whether that story is good or bad, and working to make it better.
What Are The Differences Between CSR and ESG?
The main difference between CSR and ESG is that CSR is about attitude, while ESG is about practical steps. Not every company believes in the importance of CSR, but whether or not you believe in ESG, it will have an impact on your practices.
In the current era of ESG, an increasing number of stakeholders and shareholders recognise the value of ESG. Paying attention to internal and external sustainability shows the reliability of the organisation and has an impact on the success of the company.
Furthermore, in many cases, it is the law for organisations to assess their ESG. To take one example, since 2019, UK quoted companies have had to report on their global energy use, and large businesses must disclose their UK annual energy use and greenhouse gas emissions.
On the other hand, it is quite difficult to legislate for CSR as it is individual to each organisation. Good intentions are no excuse for poor ESG standards. Tracking your ESG performance is absolutely essential to running a modern organisation. Having strong CSR is an added bonus!
How Can Convene Improve Your ESG Practices?
Alongside this, we've been working on our own ESG reporting tool, so you can monitor your journey. Our aim is to alleviate the challenges of data gathering, performance tracking, and reporting - so organisations can move towards net zero.
With Convene ESG, you can compare your ESG efforts with your peers, so you can see where you need to improve most and which areas you are already successful in. This will help your whole industry move towards effective change.
We are currently working with a number of existing Convene housing customers as part of our early adopters programme. Through their valuable feedback, we will together continue to develop and fine-tune our platform, delivering a robust end-to-end ESG experience.
If you'd like to learn more about how our Board Portal or ESG reporting software can make your governance more sustainable, contact us today to book a free trial.