“Corporate Social Responsibility (CSR) is not an add-on activity, it should act as a framework which supports the organization’s business objective,” noted Ghassan Nuqul, vice chairman of Nuqul Group. Exhorting corporations in the Middle East to adopt a serious CSR culture into the structure of their establishment is quite a challenging task, and one that is long overdue. Many are well aware that CSR is not a new concept. Evolving from the notion of basic philanthropy, CSR really emerged in the West in the 1980s/90s when big multi-nationals were forced into taking ‘responsibility’ — or were being held accountable, rather — for their exploitive actions that were affecting their surrounding communities. The 1980s, noted Dr. Khalil Gebara, co-executive director of the Lebanese Transparency Association (LTA) and author of Corporate Social Responsibility in Lebanon, witnessed “a significant shift of state intervention concerning corporate activity across the globe.” Being called out on their actions by society led corporations to wake up and begin forming CSR doctrines. Companies, whether they liked it or not, were becoming responsible, though now from the inside out.
As simple as it seems, this trend has taken quite a while to catch on in the MENA region. In the West, CSR has for a long time been a concrete and deep-rooted concept. The UK government, for example, specifically created a post for a CSR minister, as they believe that CSR is “the business contribution to sustainable development goals.” While such an inherent perspective is far from a reality in the Levant — or in the MENA region as a whole — lately the notion of CSR has been gaining significant momentum. Multi-national corporations (MNCs) are seeking to bring in their CSR doctrines from abroad, while local companies and small and medium sized enterprises (SME) are hoping to expand, and many think CSR is the exact tool for them to do that.
While big MNCs coming into the region imported the idea of CSR with their brands, local companies in the Levant, at first, turned a blind eye. This happened for various reasons, one of them being the fact that many local companies possess an attitude that they are ‘too small’ to make a difference, and that they cannot — in Lebanon, for example — deduct their CSR funds from their taxes. National companies also tend to feel their participation is too little to make a significant impact, especially when mammoth MNCs throw millions of dollars at civil society. However, it seems the trend is finally gaining momentum in the region, though local corporations face the obstacle of how to learn from successful CSR initiatives (from abroad) without mimicking them. Instead of trying to be something they are not, local companies need to find their own unique CSR formula that will fit into their own societal and structural settings.
Defining CSR
It is imperative to note that while there is a widely accepted definition of CSR, its interpretation remains subjective, especially in our region. Overall, CSR is defined as a holistic concept whereby organizations consider the interests of their society, employees, stakeholders, suppliers, regulators, and governments by taking accountability for their corporate activities. Moreover, CSR is the obligation of corporations to be held accountable to all of their stakeholders throughout all of their activities, with the core aim of achieving sustainable development — be it economic, social, and/or environmental. CSR in the Levant is on its way to embodying this definition, but a lot of time and change are needed before it can significantly reflect the true nature of CSR.
Criticism of CSR
Critics of CSR believe that such a definition goes far beyond the statutory requirements of corporations. Others argue it is the least the private sector can do, and overall, it reaps numerous benefits for them. A common mistake by corporations is their often automatic assumption that CSR is an external component of their operations. Such a misunderstanding has proved to actually prevent CSR sustainability, which, most importantly, conflicts with the interests of companies’ stakeholders. But to the contrary, the private sector should wholly incorporate CSR into their business ethics and overall structural set-up. Success stories of CSR usually come from big companies that have special CSR departments, committees, or individuals in charge of CSR research and initiatives. The way it is being done in the region today is mostly by word of mouth, said Oussama Safa, general director of the Lebanese Center for Policy Studies (LCPS). There needs to be a method in place for CSR to function properly: it should start from within corporations — through their own substantial departments, not related to, and indeed separate from, their PR agencies — to then working outside and partner with the public sector.
As Dr. Khalil Gebara, co-executive director of the Lebanese Transparency Association (LTA), noted, “the necessary questions are not being asked, and thus significant factors are being overlooked.” Moreover, said Gebara, “it is necessary to realize that current CSR approaches benefit some recipients in some cases only some of the time. Therefore, to expect a universal method to work all of the time and profit those involved uniformly is erroneous thinking.” Thus, Gebara believes there is a dire need to conduct intricate market research on CSR’s impact in the developing world, as well as analyzing the boundaries of CSR and considering alternatives to it.
Another chief criticism of CSR — from the public perspective — is that companies are just in it for branding purposes. The private sector, on the other hand, criticizes civil society as only being involved in CSR for the money. The mistrust between the private sector and civil society organizations (CSOs) is understandable, but should not be allowed to lead to neglect — it is time to put insecurities aside. In order for CSR to work properly in the Levant, the CSOs and the private sector need to meet halfway and understand they can mutually benefit. Yes, corporations seek to promote their brand, but the public also participates to receive the funds in order to implement initiatives. Neither one can actually survive without the other, so criticisms on this end should be abolished in order for a collective effort to be made to encourage the sustainable development of CSR in our region.
Philanthropy vs CSR
There is much controversy regarding the difference between CSR and philanthropy. Through extensive research, Executive found that CSR is somewhat of a natural evolution of philanthropy. In the Middle East, however, CSR is popularly viewed as an extended version and cultural adaptation of philanthropy — as quite a pious region, the Middle East is enembued by the notion of ‘goodwill’ and the Islamic concept of zakat. Similarly, Gebara personally views CSR “as the typical evolution of philanthropy,” specifically, “since the private sector began playing a bigger role in the economy, national strategy, and somehow replacing the government as the main employer in such issues.”
Gebara added that defining CSR is, “in the broadest term, the secular model of philanthropy. It is always available in the region.” Conversely, Dr. Dima Jamali, associate professor of management at AUB, finds that “philanthropy is one aspect of CSR … CSR in developing countries often draws on long standing cultural traditions of philanthropy, and community embedded-ness, translating into manifestations of CSR mostly centered around philanthropy and community involvement.” Safa agreed with Jamali, finding that philanthropy is “really one aspect of CSR — it’s one way of channeling money. People really didn’t understand that before; that’s the problem.” In the Middle East, Jamali stated, “the philanthropic variant of CSR is still the most commonly encountered, but needs to be complemented by equal attention to the economic, legal, and ethical strands.” Similarly, Elias Aoun, GM/program coordinator of the Center for Development and Planning (CDP) in Lebanon, believes that CSR is “more development-oriented, while philanthropy caters for current needs.”
Clearly, popular opinion reflects that whether philanthropy is a singular part of CSR, or if CSR evolved from philanthropy, or if they are separate concepts, in the end the two are interrelated — neither can be discussed without the other.
Help me, help you
“Today, a fragile relationship exists as companies attempt to create profitable environments without causing a public outcry or opposition,” noted Gebara. Companies all seem to invest in CSR for the same reason — to benefit from the ‘win-win’ equation. Helping society helps them promote their brands, and thus society helps the brands by responding to their wider exposure. The cyclical format of CSR — giving back to get back — is the chief reason why most corporations participate in the first place. Society, on the other hand, cannot but participate in this give-and-you-shall-receive relationship — it is rare to witness a CSO rejecting funds or support from the private sector. Moreover, it is the subconscious response by the public to corporations that help brands flourish — the more the private sector gets involved in the public domain, the more aware, so to speak, civil society becomes of the companies, and thus, inherently, they buy more of their products.
