Corporate responsibility: Still a foreign concept

Only two Israeli companies report on economic, environmental and social performance.

home economics 88 (photo credit: )
home economics 88
(photo credit: )
Israel lags far behind other Western countries when it comes to local businesses fostering philosophies of social responsibility, and reporting civil activities - according to global standards - is extremely scarce, a survey conducted by private consultancy firm Arkada reported Wednesday. The report came one day ahead of the second Israeli Conference on Corporate Social Responsibility (CSR) to be held Thursday at Tel Aviv University. Assessing how large corporations based in Israel presented their programs of social responsibility compared to businesses in other countries, Arkada CEO Liad Ortar found that Israel was on par with nations such as Romania, Kuwait, Nigeria and Algeria, but fell far behind Portugal, New Zealand and Chile. Ortar based his assessment on the fact that to date, only two corporations - Bank Leumi and Intel's local operation - had published corporate social responsibility reports in the past two years based on the Global Reporting Initiative (GRI) standard; GRI is a Web-based resource that sets out principles and indicators that organizations can use to measure and report their economic, environmental and social performances. "There are quite a lot of Israeli-set standards," Ortar told The Jerusalem Post Wednesday. "But these do not allow for us to compare Israeli company practices with any other countries or companies worldwide." Ortar said that corporate social responsibility, which is now held in high regard by thousands of large corporations across the globe, is much more than classic philanthropy or charitable donations to the local community. "It is how much the company engages in dialogue and feedback with its shareholders and reporting on it is part of that," explained Ortar, who set up his consultancy firm two years ago after translating and tailoring the GRI index to fit Israel's market and cultural practices. "Shareholders could be regular customers or government, non-governmental organizations or even just the local community that benefits from the company's activities. Corporations need to consider all their needs and local social and environmental issues when formulating their policies and practices." Ortar also said that focusing on social responsibility could be highly beneficial to companies because being successful "is not only about adding up the numbers, but also about creating public trust, encouraging discourse and open channels of communication." A former Greenpeace activist and expert in environmental issues who worked for a short stint in the hi-tech and public relations industries, Ortar gave the example of how strong communication with NGOs can help corporations develop plans for any future laws or regulations and better predict how that can translate into good business planning. Thursday's conference, which will feature guest speaker GRI technical manager Sean Gilbert giving an overview of worldwide trends, will examine the concept of corporate social responsibility as it pertains specifically to this country. It will also compare the two GRI reports from Bank Leumi and Intel. "There is a big difference between this year's conference and the last one," pointed out Ortar. "At the last conference we had nothing and now at least we have two reports; that changes everything." Although Ortar notes a growing number of businesses are currently contemplating issuing GRI reports, and while he is hopeful that by next year's conference there will be many more such reports available, he is also realistic. "There is a change going on, but it is not going to happen overnight," he said. "However, there is no reason that Israel should not issue between 15-20 reports a year like any other Western country."