The Challenges of Today's CSR 3.0

We are in the early stages of an era that I like to call "corporate responsibility 3.0."

The first and longest stage of modern corporate responsibility was characterized by companies developing codes of corporate conduct, CSR initiatives and socially responsible investing (SRI). It was, in essence, a feeling out period to determine whether corporate responsibility had staying power.

CSR 2.0 was ushered in by Sarbanes-Oxley and was largely a response to well-documented scandals, abuse and corporate misbehavior.

In today's new era of CSR 3.o, the corporate sector faces the challenge of independence. Consumers and customers are increasingly independent-minded in their purchasing decisions. Investment capital is increasingly independent as private equity plays a larger role. And new regulatory mandates have convinced shareholders that public companies need to be guided by independent directors with little connection to the companies.

As higher profits abound in some sectors--energy, financial services, and technology, more companies will have to figure out how to make their contributions to society consistent with the new requirements of CSR 3.0.

(c) 2008 Adonis E. Hoffman