Table of Contents

Part 1 – Introduction .............................................................................................................. 4

1.1 About the Guide .................................................................................................................... 4
1.1.1 Intended audience ........................................................................................................... 4
1.1.2 Structure.......................................................................................................................... 4
1.2 CSR Defined ......................................................................................................................... 5
1.2.1 Aspects of CSR ............................................................................................................... 7
1.3 Current Context for CSR ....................................................................................................... 8
1.3.1 Why is CSR important? .................................................................................................. 8
1.4 Business Case for CSR ....................................................................................................... 10
Part 2 – Building a CSR Plan of Action ......................................................................... 15
2.1 CSR implementation framework ......................................................................................... 15
2.2 Task 1: Assess CSR Awareness and Action ....................................................................... 16
2.2.1 What is a CSR assessment and why do it? ................................................................... 17
2.2.2 How to do an assessment .............................................................................................. 17
2.3 Task 2: Develop a CSR Strategy and Initiatives ................................................................. 26
2.3.1 What is a CSR strategy? ............................................................................................... 26
2.3.2 How to develop a CSR strategy.................................................................................... 27
2.4 Task 3: Implement a CSR Strategy and Initiatives ............................................................. 37
2.4.1 What is CSR implementation? ..................................................................................... 37
2.4.2 How to implement a CSR strategy ............................................................................... 38
2.5 Task 4: Communicate Performance .................................................................................... 41
2.5.1 What is CSR communication?...................................................................................... 41
2.5.2 How to communicate a CSR strategy and initiatives ................................................... 41
2.6 Task 5: Evaluate and Scale-up ............................................................................................ 46
2.6.1 What is a CSR evaluation? ........................................................................................... 46
2.6.2 How to do an evaluation ............................................................................................... 47
2.6.3 Scaling-up a CSR approach .......................................................................................... 47

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Part 3 – Key CSR Issues ...................................................................................................... 48
3.1 Engaging stakeholders......................................................................................................... 48
3.1.1 What is stakeholder engagement? ................................................................................ 48
3.1.2 What are the benefits of stakeholder engagement? Why does it matter? ..................... 49
3.1.3 Using stakeholder engagement to implement a CSR strategy and initiatives .............. 49
3.1.4 How to engage with stakeholders ................................................................................. 50
3.1.5 Working with Aboriginal peoples ................................................................................ 54
3.2 Risk and Materiality ............................................................................................................ 56
3.2.1 What is a risk assessment?............................................................................................ 56
3.2.2 What is a materiality assessment? ................................................................................ 56
3.3 CSR Reporting .................................................................................................................... 58
3.3.1 What is a CSR report? .................................................................................................. 58
3.3.2 What are the benefits of producing a CSR report? ....................................................... 59
3.3.3 What are the key steps to produce a CSR report? ........................................................ 60
3.3.4 Verification of a CSR report......................................................................................... 60
3.4 Relationship between CSR and the Law ............................................................................. 63
3.4.1 Corporate governance ................................................................................................... 63
3.4.2 Reporting on corporate performance ............................................................................ 64
3.4.3 Bribery and corruption.................................................................................................. 64
3.4.4 Important international laws with implications for Canadian companies .................... 65
Annex 1 - CSR Standards, Guidelines and Initiatives .................................................................. 67
Endorsed by the Government of Canada: ................................................................................. 67
Annex 2 – Additional Tools and resources ................................................................................... 68
Annex 3 – CSR expert advisory group ......................................................................................... 73
Endotes.......................................................................................................................................... 74

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The development of the CSR Guide benefited from input from an Expert Advisory Group (see
Annex 3); however, the Guide neither represents a consensus of the Advisory group nor the
views of individual members and the organizations to which they belong. The businesses
mentioned in the Guide are not endorsed by the Government of Canada or by the Expert
Advisory Group.

Questions, comments and suggestions concerning the Guide should be sent to:

CSR Manager
Industry Canada,
235 Queen Street
Ottawa ON K1A 0H5

Part 1 – Introduction
1.1 About the Guide
The CSR Implementation Guide for Canadian Business1 provides practical advice to companies
on corporate social responsibility (CSR). It contains information on: how to build a business case
for carrying out CSR initiatives; how to develop and implement a CSR strategy; and how to
measure and communicate the outcomes.

1.1.1 Intended audience

The Guide is intended for Canadian businesses interested in integrating CSR principles and
practices into their operations. It will be of use to:

• Businesses of various size across all different sectors and industries;

• Businesses that are new to or are already engaged in CSR initiatives;
• Businesses with international operations; and
• Business leaders and employees with responsibility for CSR, including senior
management, board members and "front-line" employees.

1.1.2 Structure

The Guide has three parts:

• Part 1 provides an overview of CSR, including sections on defining CSR, on the current
context that is shaping the discourse, and on the business case for adopting CSR
initiatives;
• Part 2 sets out a CSR implementation framework; and

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 • Part 3 outlines 4 key topics related to building and executing a CSR strategy:
o Stakeholder engagement, risk management, CSR reporting, and CSR and the law.

The Guide is intended to be suggestive, not prescriptive. As such, throughout the Guide, text
boxes are used to illustrate 'real-world' case studies and examples, and to provide "quick
glimpse" summaries of selected topics. The aim of this information is to provide the reader with
applicable context and insights, and to assist companies in identifying an approach to CSR that
best fits their context.

In addition, three annexes accompany this Guide:

• Annex 1 contains supplementary information on key international CSR standards,

guidelines and initiatives that are endorsed by the Government of Canada;
• Annex 2 provides a list of additional tools and resources to help implement a CSR
strategy; and,
• Annex 3 lists the members of the CSR Expert Advisory Group that provided input into
the development of the Guide.

Legend for icons used in this publication:

Reality Check

Examples of CSR initiatives

CSR and small business

Guidance and links for

producing a CSR report

1.2 CSR Defined

The Government of Canada CSR strategy entitled Doing Business the Canadian Way: A Strategy
to Advance CSR in Canada's Extractive Sector Abroad, defines CSR as the "(…) voluntary
activities undertaken by a company to operate in an economically, socially and environmentally
sustainable manner." There is, however, not one universally accepted definition of CSR, and as
such other notable definitions do exist.

The International Organization for Standardization (ISO) uses the term ‘social responsibility' to
define CSR as "The responsibility of an organization for the impacts of its decisions and
activities on society and the environment, through transparent and ethical behaviour that:

• contributes to sustainable development, including the health and welfare of society;

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 • takes into account the expectations of stakeholders;
• is in compliance with applicable law and consistent with international norms of
behaviour; and
• is integrated throughout the organization and practiced in its relationships."

The Organisation for Economic Cooperation and Development (OECD) defines ‘responsible
business conduct' in its Guidelines for Multinational Enterprises as "The positive contributions
that multinational enterprises can make to economic, environmental and social progress, and to
minimize the difficulties to which their operations may give rise."

As is evidenced by these three definitions, there are many different terms for what is considered
CSR:

Irrespective of how CSR is labelled, what is most important is integrating social, environmental
and economic considerations into a business' core values, culture, decision-making, strategy and
operations. This should be carried out in a transparent and accountable manner, with the overall
objective being more effective and efficient business practices, increased wealth creation and
improved societal outcomes.

From doing ‘good' to doing ‘right'

"For most Canadian businesses, responsible business conduct has moved from doing ‘good' to
doing ‘right.' It's not about philanthropy anymore - it's at the core of their operations."

-Perrin Beatty, President and CEO of the Canadian Chamber of Commerce.

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1.2.1 Aspects of CSR

Beyond complying with laws and regulations related to CSR topics, voluntary CSR initiatives
typically pertain to one or more of the following topics:

• Corporate governance • Technology development and

• Community involvement, research
development and investment • Human rights
• Anti-bribery and corruption policies • Customer satisfaction
• Corporate philanthropy and • Consumer safety
employee volunteering • Employee engagement and well-
• Employee health and safety being
• Involvement and respect for • Labour rights
Aboriginal peoples • Adherence to principles of fair
• Accountability and transparency competition
• Community health and safety • Performance measurement and
• Environmental stewardship reporting
• Corporate ethics • Employee development
• Supplier relations, and sourcing
practices

Many of the subjects above intersect with Canada's regulatory and legal framework; Section 3.3
of the Guide provides more information on the relationship between CSR topics and relevant
laws.

Reality Check

"We already obey all the laws so why do we need to do more than that?"

Compliance with the law is the minimum expectation for companies. Complying with the law,
however, does not ensure that a company is profitable or competitive, that it attracts the best
employees or that it gains the support of communities. CSR has the potential to provide
significant business benefits, including differentiating your innovative products and services
from your competitors; reducing costs and risks; helping attract and retain employees; meeting
customer and partners' needs; and building strong relationships with communities.

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1.3 Current Context for CSR
This section aims to provide background information that explains why considering CSR has
become integral to business success.

1.3.1 Why is CSR important?

The activities of the private sector can have a significant impact on the environment, on
communities and on the economy. Effectively recognizing and managing these environmental,
social and economic costs, as well as the impacts, opportunities and risks they present is an
indicator of a well-managed company.

United Nations (UN) Principles for Responsible Investment

In 2006, the UN launched the Principles for Responsible Investment (PRI). The UN PRI provides a practical
framework for investors to recognize environmental, social and governance factors in investment decision-making
and ownership. As of 2012, more than 1,000 investors, managing more than $30 trillion in assets – approximately
20% of the world's capital – have signed on to the United Nations PRI.

Companies that derive the most value from CSR have moved beyond considering it an "add-on"
or a separate function. They embed CSR initiatives into their everyday business, strategically
integrating and aligning them into their core functions. Michael Porter, a professor at Harvard
University and a leading expert on the value of integrating CSR into business operations, calls
this approach "creating shared value."

Creating shared value

The "creating shared value" concept encourages companies to think about creating societal benefit as a powerful
way to create economic value for the firm. Using a business value proposition to address societal needs can involve
redesigning a product, reconfiguring the value chain, and engaging with supporting industries and business partners
towards a social goal.2

Environmental sustainability

Despite progress in minimizing the environmental impacts of the private sector, the costs of
unsustainable business practices on the environment are significant. A 2011 study by Trucost,
commissioned by the United Nations Environment Program, estimated that the annual
environmental cost from global human activity was 11% of the world's GDP in 2008, and that
the world's 3,000 largest publicly-listed companies were responsible for $2.15 trillion US, of
environmental damage.3 CSR initiatives, such as recognizing and managing the environmental,
social and economic costs of production, are therefore a fundamental part of the response of the
private sector to adapt business practices and to address unsustainable uses of the environment.

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Economic sustainability

Economic activity is central to all companies – generating wealth for shareholders and
employees. Responsibly managing the broader economic impacts of business, such as
monitoring the labour conditions of key suppliers, is an important element of CSR, and is also an
opportunity to ensure a company's long term competitiveness and profitability.

Social sustainability

Businesses are an integral part of the communities where they operate. Their success and
"license to operate" are based on continued good relations with a wide range of individuals,
groups and institutions. Companies are increasingly well positioned to confront a wide range of
social issues, and are recognizing that actions in this area are increasingly scrutinized and
publicized by consumers and the media. From employee well-being and local community
development to major global issues, such as gender inequality, poverty, the spread of chronic
diseases, human rights abuses and high child mortality rates, addressing these topics is in the
long term self-interest of business.

A final point in this section addresses the emerging trend of companies to both collaborate and
compete in the CSR sphere. This means that companies are collaborating on CSR efforts when
that is more efficient, while continuing to compete on their signature CSR initiatives. For
example, companies may cooperate by working together with a voluntary labour standard
scheme to ensure industry-friendly outcomes, while the same companies compete in other CSR
areas, such as on supply chain sustainability initiatives.

Small and medium enterprises (SMEs) have characteristics that enable CSR
efforts

• SMEs are flexible and adaptable – they are able to quickly act on new opportunities as
they arise and to take advantage of new niche markets.
• SMEs are creative and innovative – they constantly look for efficiencies through creative
thinking and innovation, and often champion new ideas in the marketplace.
• SMEs are less bureaucratic – this makes it easier to get the CSR message across and to
get your whole company involved.4

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1.4 Business Case for CSR
Formulating a business case for CSR can differ from one company to another since it depends on
many factors, such as:

• company size;
• industry or sector;
• products and services;
• position in a supply chain;
• location;
• customers;
• suppliers;
• stakeholders and partners;
• corporate leadership; and
• reputation.

Nevertheless, there is growing consensus regarding the connection between CSR and business
success. A 2013 study by the MIT Sloan Management Review and the Boston Consulting Group
found that more than 60% of companies that have embedded sustainability into their
management agenda have reported increased profits from sustainability initiatives.

Additionally, a study of 275 global Fortune 1000 companies found that the top 50 most
sustainable companies outperform the bottom 50 by 38% when it comes to shareholder returns
over a five-year period. Despite the fact that it is not possible to know whether this is a direct
‘cause' and ‘effect' relationship, the study still provides compelling motivation to invest in
sustainability. In fact, 93% of CEOs recognize that sustainability initiatives are important to their
company's future success.5

At a more operational level, the following describes some of the key potential business benefits
of adopting CSR initiatives.

Key Benefits of a CSR Strategy

The integration of CSR initiatives across a company can lead to the
development of innovative processes, technologies, products or services;
Competitive addressing sustainability issues through these channels can:
Advantage
• differentiate a company from its competitors; and
• enhance a company's reputation and brand.
Markets for environmentally sustainable and ethical products are
expanding, leading to new market opportunities; applying CSR initiatives
New business
will help your company to compete on either the supply or demand side of
opportunities
any new opportunity, and to ensure that your existing markets remain
viable for the long term.

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 Financial institutions and institutional investors are increasingly
incorporating social and environmental criteria into their assessment of
Access to finance investments and lending. Companies that can demonstrate a strong CSR
performance may have preferential access to investment funds or to
financing, or may receive preferential terms.
Carrying out CSR initiatives related to, for example, energy, water,
Improve efficiency transportation, packaging, manufacturing processes and waste can often
reveal opportunities for efficiencies and cost reductions.
Enhance ability to Employees want to work for companies that reflect their values on the
recruit, develop environment and society. Companies that implement a CSR strategy can
and retain staff realize improvements to staff recruitment, engagement and retention.
Improve CSR initiatives can support companies in building strong relationships with
stakeholder and governments, key stakeholders and communities. These relationships can
community help a company to build and to maintain a "social license to operate" and
relations can evolve into public, private and civil society alliances.
Use CSR initiatives to better anticipate and manage risks related to:

Access to resources
• Implementing sustainable practices can ensure that a company can
continue to access the inputs, e.g., raw materials, it needs to operate
into the long term.

Operations
• Risks such as those arising from extreme weather, community
disputes, and health and safety incidents at the premises of your
suppliers.

Financial and legal exposure

Manage risks
• Addressing environmental or community issues before they occur
can reduce the probability of having to make more costly
investments or to pay for litigation processes after an issue has been
exposed.

Reputation
• CSR initiatives that build trust and credibility can support a
company's reputation for delivering products or services while
maintaining a strong environmental or social performance.
• This is particularly important for organizations with high-value
brands that can easily become the focus of media, activist or
consumer pressures.

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Given the benefits listed, the following two boxes demonstrate how companies are benefiting
from CSR initiatives.

Companies benefit from implementing CSR

• Vancity, a Vancouver-based credit union, installed programmable thermostats and automatic lighting systems
and as a result cut electricity use by 20%.
• In 2012, TD CanadaTrust implemented a video-conferencing pilot program which saved over 800,000 km of
travel and 48 tonnes of CO2.
• In 2009, Canadian grocer and retailer Loblaw made a commitment that by 2013 it would only sell fish from
certified sustainable sources. Overall, the initiative has resulted in deepening and more stable supply chain
relationships.

Companies benefit from implementing CSR

• Vancity, a Vancouver-based credit union, installed programmable thermostats and automatic lighting systems
and as a result cut electricity use by 20%.
• In 2012, TD CanadaTrust implemented a video-conferencing pilot program which saved over 800,000 km of
travel and 48 tonnes of CO2.
• In 2009, Canadian grocer and retailer Loblaw made a commitment that by 2013 it would only sell fish from
certified sustainable sources. Overall, the initiative has resulted in deepening and more stable supply chain
relationships.

"(…) a study looked at 230 workplaces with more than 100,000 employees and found that the more a company
actively pursues worthy environmental and social efforts, the more engaged its employees are. The Society for
Human Resources Management compared companies that have strong sustainability programs with companies that
have poor ones and found that in the former morale was 55% better, business processes were 43% more efficient,
public image was 43% stronger, and employee loyalty was 38% better. Add to all that the fact that companies with
highly engaged employees have three times the operating margin and four times the earnings per share of companies
with low engagement, and you've got a compelling business case for this trend to continue (…)."6

The business case for implementing CSR initiatives expands beyond optimizing business
operations and ensuring long-term viability to the need to align a business with the values of its
customer/client base. The following four text boxes demonstrate the growing importance of
maintaining a strong corporate reputation in the eyes of customers/clients.

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CSR and reputation

The Reputation Institute's 2011 "Pulse Survey" indicated that CSR is responsible for more than
40% of a company's reputation.7

Canadians are talking about CSR

A majority of Canadians (60%) talk with friends and family about topics related to social
responsibility: 42% say they talk with friends and family about a company's ethical behaviour
and 33% say they have recommended a company because they believed it was socially
responsible.8

Canadians consider themselves to be ethical consumers

• More than half of Canadians (58%) consider themselves to be ethical consumers.

• Three in ten respondents (29%) said they would spend an additional $15 or more
on a $100 item if they were sure it was ethically made.9

Ethical consumers

According to a 2012 survey by the Responsible Consumption Observatory, nearly three-quarters

(73.8%) of Ontarians believe that to consume responsibly is to buy eco-friendly goods and
services. In 2012, nearly half (46.4%) of Ontario consumers surveyed had increased their
consumption of green goods and services, and 53% had occasionally switched brands due to
environmental convictions.10

"Aspirational" consumers

Through a global study on consumer values, motivations and behaviours, BBMG, GlobeScan
and SustainAbility found that 37% of consumers surveyed could be categorized as "aspirational"
consumers. "Aspirational (consumers) represent the persuadable mainstream on the path to more
sustainable behaviour. They love to shop, are influenced by brands, yet aspire to be sustainable
in their purchases and actions." This consumer segment represents a significant opportunity for
forward-looking brands to unite consumerism with social and environmental values."11

"Aspirational" consumers represent hundreds of millions of consumers globally, and the largest
consumer segment in Brazil, China and India. They are also among the most likely to believe in
the need to "(…) consume a lot less to improve the environment for future generations" (73%),
and to feel "(…) a sense of responsibility to society" (73%).

-Raphael Bemporad, Co-Founder of BBMG

Despite the strong business case for implementing a CSR strategy, some companies face
challenges in doing so. The table below presents some examples of common obstacles to

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implementing CSR and strategies to overcome them. Many companies also anticipate significant
obstacles; the table below presents a series of perceived obstacles and how a company may
overcome them.

Common obstacles to implementing CSR in a business and suggestions on how to overcome

them
• Build responsibility for CSR initiatives into existing job
profiles, based on your CSR focus areas.
• Find colleagues that are already interested in and thinking
Lack of resources
about CSR – they will be more willing to take on CSR
responsibilities.

• Start with activities that will reduce costs, such as energy, water
and waste efficiency.
Too costly • Think of ways that CSR can add value to the business or for
customers, i.e., the business case.

• Consider sending an employee on CSR training or hiring a

Lack of expertise consultant.

• Show stakeholders that a company is keen to demonstrate

Stakeholders are not responsible business practices before they are demanded; be
demanding action proactive.

• Develop a business case, highlight competitor company

practices and start the conversation early.
Lack of upper
• Identify a CSR champion in upper management to help
management support
facilitate communication and engagement.

The next section of the Guide presents a CSR implementation framework, with a focus on how
to develop and implement CSR initiatives.

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Part 2 – Building a CSR Plan of Action
2.1 CSR implementation framework
This part of the Guide follows a "plan, do, check and improve" framework that supports
continuous improvement. The framework is intended to be flexible; you are encouraged to adapt
it and to select the aspects and actions that are most relevant and that have the greatest impact
potential.

The five key tasks to building a CSR plan of action are shown in the figure below, and the
following table demonstrates the process for executing each task. The next five sections of the
Guide go into greater detail on each of these tasks.

Implementation Framework
Phase Task Process
How to do a CSR assessment:

1. Assemble a CSR team.

2. Develop a working definition of CSR.
1. Assess the existing CSR situation 3. Articulate a business case for CSR.
4. Review operations, documents and
processes.
5. Identify key stakeholders.

Plan How to develop a CSR strategy and initiatives:

1. Research what competitors are doing.

2. Develop CSR initiatives.
3. Build support with senior management
2. Develop a CSR strategy and
and employees.
initiaitves
4. Set performance measurements.
5. Hold discussions with major stakeholders.
6. Draft, review and publish the strategy and
initiatives.

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 Implementation Framework
Phase Task Process
How to implement a CSR strategy:

1. Develop an integrated CSR decision-

3. Implement the CSR strategy and making structure.
Do
initiatives 2. Design and conduct CSR training.
3. Establish mechanisms for addressing
problematic behaviour.

How to communicate a CSR strategy and

initiatives:
4. Communicate about the CSR
Check 1. Estalish a target audience and objectives.
strategy and initiatives
2. Choose a message.
3. Decide how to communicate.

How to evaluate a CSR strategy and initaitives

5. Evaluate and scale-up the CSR
Improve
strategy and initiatives • Scale-up a CSR approach

Cross-check: Once the cycle of going through each task is completed, return to the "Plan"
phase and start the next cycle.

2.2 Task 1: Assess CSR Awareness and Action

In this section you will learn:

• What a CSR assessment is and why it is important

• How to do a CSR assessment

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 2.2.1 What is a CSR assessment and why do it?

Carrying out a CSR assessment can help a company to identify its potential CSR-related gaps,
opportunities, risks, challenges and problems, and can culminate in an understanding of where a
company is strong and where it is weak relative to internal CSR goals, competitor initiatives and
best practices.

A CSR assessment can provide an understanding of the following:

• the internal and external drivers motivating a company to undertake a systematic approach to
CSR;
• the existing internal interest and buy-in;
• the key CSR issues that are affecting or that could affect a company;
• an inventory of existing CSR-related initiatives;
• key stakeholders who are, or who need to be, engaged;
• the current corporate decision-making structure and its strengths and inadequacies in terms of
implementing a more integrated CSR approach; and
• the human resource and budgetary implications of a chosen CSR approach.

2.2.2 How to do an assessment

A five-stage CSR assessment process is set out below:

1. Assemble a CSR team

2. Develop a working definition of CSR
3. Articulate a business case for CSR
4. Review corporate documents, processes and operations
5. Identify and engage with key stakeholders

Of course, this is not the only way to do an assessment; rather it is one way for a company to
review, through a CSR lens, the full range of its operations. The bottom line is such that as long
as a thorough appraisal is carried out, then it will have achieved the objective of the assessment.

Quick tip for SME

• Consider using one of the many existing self-assessment tools, such as the Corporate
Responsibility Assessment Tool, published by the Conference Board of Canada; see
Annex 2 for additional tools.
• Ask an industry association or CSR specialist organization whether it offers assistance
with self-assessment

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I. Assemble a CSR Team

Who are a company's CSR champions?

After confirming the need for a CSR team, frank discussion should take place at the outset about
the team's objectives, members' responsibilities, and anticipated workload and outcomes. Regular
two-way communication between a CSR team and the company as a whole may also be
useful. The following table provides guidance for selecting a CSR team.

Three categories of employees to include on a CSR team

Representatives of the board, top management or owners

It is critically important that a CSR team be directly accountable to senior management, and
ultimately to the board (if applicable). This acknowledges that effectively implementing CSR
initiatives requires integration into a company's central values and operations. Having a senior
manager on the team also sends a clear signal that a company considers CSR to be important.
Additionally, senior management and executives have access to:

• the resources needed to implement a CSR strategy;

• the long-term and high-level vision of what a company's CSR approach should be;
• legitimacy and credibility to lend to the team; and
• helpful insights to bring in the right people and to keep things moving forward.

Management-level representation from all of the business units

Ensuring each business unit is represented from the beginning means an efficient integration of
CSR practices and processes into all operations, processes, and decision-making.
Front-line staff

Front-line staff are often most familiar with a company's day-to-day business and interactions
with customers, business partners and stakeholders. Front-line staff are also likely to have critical
insights into CSR obstacles and opportunities.

Include diversity on a CSR team

Once you have an idea of who should be represented on your CSR team, consider choosing
individuals that represent diversity in terms of age, gender, ethnicity, and seniority – a variety of
perspectives will contribute to a more robust and effective CSR strategy.

II. Develop a working definition of CSR

Does everyone in a company think of the same thing?

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A chosen CSR definition will become the foundation for the rest of the assessment and provides
the opportunity to identify what CSR means for a company. The definition should be something
quite general that reflects a company's values, and that resonates with its business priorities.

Below are selected company examples of what a working definition of CSR could look like.

Examples of CSR and sustainability definitions

"At Vancity, sustainability means ensuring we're a strong enduring organization by doing
business in a way that contributes to the well-being of our members, communities and the
environment."12

Vancity
"Our triple bottom line approach to business balances economic growth with environmental and
social goals. We understand that in order to realize our objective of delivering on TELUS' future-
friendly® brand promise by putting customers first, we need to be one of Canada's leading
corporate citizens – a company our customers are proud to connect with."13

TELUS
"Our approach to sustainability involves looking at our extended value chain and the life cycle of
products – including product sourcing, transporting product to stores, the design and operation of
stores, and the eventual "end-of-life" product disposal and recycling – in the most energy
efficient and cost efficient manner. The end result is a strategy that advances our business while
directly benefiting both customers and the environment."14

Canadian Tire
"It is really core to our business. We define sustainability for our company as helping patients
prevail over serious diseases in a manner that contributes to economic growth, social
responsibility and a healthy environment."15

Bristol-Myers Squibb

III. Articulate a company's business case for CSR

Why we do this?

After having developed a definition of CSR, the next step is to draft a business case. Of most
importance, a business case must include how a company will benefit and derive value from
implementing any CSR initiatives. As such, consider the following questions to Guide this
exercise:

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 Questions to ask as you build your company's business case

• What are a company's short-and long-term goals?

• What benefits would a company like to realize from implementing CSR initiatives?
• In which areas of a business could particularly large CSR gains be made?
• In which areas can a company potentially gain a competitive advantage?
• Are there any risks or threats that a company faces that could be dealt with through CSR
initiatives?
• Where are a company's opportunities for cost reductions?
• Who initiated an interest in CSR?
• What were the circumstances?
• What do board members, senior executives, and owners have to say?
• In which areas of a business do key stakeholders have particular influence and/or interest?
• What do its customers or clients think about CSR?
• Do any broader changes led by senior management align with a CSR approach?
• What are competitors doing when it comes to CSR?
• What benefits are they seeing?
• What company data and/or literature can support the case?

IV. Review company operations, documents and processes

What is already in place? Where are the gaps? What can be changed?

With a working CSR definition and a defined business case, the next step is to review company
documents, processes and operations for actual and potential CSR implications. In other words,
you want to understand where a company's existing policies and documents intersect with any
potential CSR topics; many companies are already engaging in CSR initiatives without
necessarily identifying them as such.

Key operational and governance documents

What is in place that already supports CSR? Where are the gaps?

Documents to include in a review could include a company's:

• mission and value statements;

• codes of conduct;
• policies (e.g., human resources, health and safety, management systems, procurement/sourcing,
ethics, anti-bribery, environmental protection, community engagement, labour, supply chain
engagement, security, research and development, executive compensation, etc);
• operating documents or guidelines;
• employee job descriptions, and education and advancement programs;
• consumer engagement strategies;
• risk management analyses; and

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• communications products.

In summary, collecting and reviewing this and similar information will provide quick insight into
a company's potential CSR focus areas.

Below is a sample framework for conducting a document review.

Sample framework for conducting a document review

Assessment Criteria Document A Document B Etc.
Why was this document developed? What was it in response
- - -
to?
What aspects of CSR are mentioned in this document? - - -
Does this document reference any international standards or
guidelines relating to CSR? (See Annex 1 for examples of such - - -
standards).
How does this document compare to our competitors'? - - -
What gaps can be identified in terms of existing and desired
- - -
CSR initiatives?

Decision-making processes

Who makes which decisions and how?

Existing decision-making processes and criteria may have an impact on how a CSR strategy is
developed and implemented. Often, a variety of different departments and individuals will
already be making daily CSR-related decisions. The table below, therefore, describes common
business processes at companies, and suggests questions to map different departments'
connections with CSR.

Business process Key questions to ask

• How do products impact on environmental, social or
economic issues?
• Are customers making purchasing decisions based on
Customer service and business
CSR considerations?
development
• How do customers get CSR information about a
company and its products?

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 Business process Key questions to ask
• Is strong performance in CSR being encouraged through
our performance management and measurement
processes?
• Are CSR topics embedded into roles and
Human resources
responsibilities?
• What are prospective employees asking about the CSR
practices of a company?

• Are requirements set for suppliers' environmental and/or

social performance?
• What are the CSR risks and opportunities in a supply
chain?
Procurement/sourcing • What are the largest purchases in terms of volumes and
value? From whom are they purchased?
• Are employees with a "buying" or sourcing function
trained on supply chain sustainability issues?

• How can CSR be used to access new markets?

• What aspects of CSR does the current market find
interesting?
Marketing and media relations • How does current messaging reflect CSR?
• What CSR issues or topics are customers talking about
through social media?

• How do research and development priorities relate to

CSR?
• Are there potential CSR solutions or opportunities that
Research and development
can be delivered through research and development
work?

• What CSR issues are considered in strategic planning?

Strategic and business • How is CSR impacting on business conditions and on
planning our operating environment?

• What CSR issues are considered in project management

processes?
• What are the opportunities for including CSR in our
Project management project management processes?
• Is stakeholder engagement effectively integrated into
project management?

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 Business process Key questions to ask
• What CSR risks are currently identified through risk
assessment processes?
Risk management • Can risk management processes be changed to ensure
routine consideration of CSR risks?

• What assurance processes are in place to evaluate CSR

performance?
Assurance
• Are there any gaps in assurance around CSR?

V. Identify key stakeholders

Who are key stakeholders?

Determining the potential interests and concerns of stakeholders can reveal opportunities and
potential problem areas related to the development of a CSR strategy.

A useful technique is therefore to carry out a stakeholder mapping exercise. This is a way of
identifying the variety of stakeholder relationships that a company has, and of assessing the
relative proximity or strength of that relationship. A sample list of potential stakeholder groups
and an example of a stakeholder mapping exercise from the International Finance Corporation's
Strategic Community Investment Good Practice Handbook16 are included below.

Note that while stakeholder mapping is listed here as the last element of a CSR assessment, this
exercise could be undertaken concurrently with other steps in this section.

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 Existing CSR assessment tools

• Conference Board of Canada. Corporate Responsibility Assessment Tool

• See Annex 2 for a list of additional CSR assessment tools and resources.

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Note that section 3.1 in the Guide provides detailed guidance and practical tools on how to
identify and engage your stakeholders.

Reality Check

"Assembling a CSR team, developing a working definition of CSR with employee/management

engagement, reviewing core documents, decision-making processes and CSR-related activities,
and mapping stakeholders. Do you know how much time it will take to simply recruit and
engage a CSR team that represents all of our business lines and offices throughout Canada and
around the world, let alone schedule them into regular meetings to manage CSR activities?
You've got to be kidding!"

If done properly, effectively implementing CSR initiatives does indeed take a significant
investment of resources at the "front end" of the process. The return on this investment flows
from a company being as prepared as possible to address the CSR challenges, opportunities and
choices available, and from a company being less vulnerable to unexpected social and
environmental-related challenges.

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 The next step is to turn a CSR assessment into a strategy and initiatives; the next section of the
Guide provides details on this next task.

2.3 Task 2: Develop a CSR Strategy and Initiatives

In this section you will learn:

• What a CSR strategy and initiatives are and why they are important
• How to develop a CSR strategy and initiatives

2.3.1 What is a CSR strategy?

How will you organize a CSR strategy? What are the focus areas?

One company may choose to focus its efforts in multiple areas – employee health, environmental
impact and supporting local communities through its sourcing practices, while another might
focus entirely on environmental initiatives related specifically to one issue, such as water usage.

A CSR strategy is a road map for moving ahead on CSR issues. It sets a company's direction and
scope over the long term with regard to CSR initiatives. The ultimate goal is to embed a CSR
strategy into a company's strategic objectives, processes and competencies.

An effective CSR strategy identifies the following:

• overall direction and objectives for where a company wishes to go in its CSR work;
• a basic approach for getting there;
• specific focus areas, initiatives and performance indicators; and
• immediate next steps.

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 CSR and small business

A CSR strategy is most likely to succeed when it:

• is aligned with a company's values and core business;

• is supported and championed by senior management;
• makes use of input and ideas from a company's employees; and,
• approaches issues systematically, building on strengths and addressing weaknesses.

Quick tips for SMEs

• Determine priorities before developing a strategy; priorities will Guide the overall
strategy.
• Set aside time to identify links between the actions in the strategy and the business case
for CSR.
• Join an association with a CSR focus; there are a number of associations that offer
assistance with developing a CSR strategy or that can make a referral.

2.3.2 How to develop a CSR strategy

The following six steps describe a typical approach to developing a CSR strategy:

1. Research what competitors are doing

2. Develop CSR initiatives
3. Build support with senior management and employees
4. Set performance measurements
5. Hold discussions with major stakeholders
6. Review and publish strategy and initiatives

Each step is described in more detail below.

I. Research what competitors are doing

Examining the vision, values and policy statements of leading competitors, along with their
codes, new CSR-related product lines or approaches, and any initiatives or programs in which
they participate, can provide example models and can inform competitive positioning. Assessing
the benefits, costs, immediate outcomes, resource implications and changes to current practices
necessary to adopt similar approaches may also provide helpful information. When reviewing the
CSR initiatives of others, consider the following questions:

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 How to assess what your competitors are doing

• What people and organizations were involved in developing these initiatives?

• Would these groups be the same people and organizations that would need to be involved in a
company's own CSR initiatives?
• What are the objectives underlying the development of these CSR initiatives? Are those
objectives the same or different from those underlying a company's CSR objectives?
• Can a particular CSR issue identified by a company be resolved or addressed through the use of
these or similar CSR initiatives?
• What are the potential costs, drawbacks and benefits of the various types of initiatives?
• What approach, standard or initiative is a company already associated with, eg., issue or
industry specific codes, corporate standards or certifications, including voluntary standards,
and/or international initiatives.
• What is the applicability or suitability of these initiatives to a company in light of its scope of
activities and the geographic range of its operations?
• Will a company benefit from the initiatives and, if so, how?

II. Develop CSR initiatives

What should be done? What will be done? How will these actions benefit a company?

Drawing on the work from a preparatory CSR assessment exercise, especially the information
collected to formulate a business case, and from an analysis of competitors' strategies, the next
step is to begin to draft a complete strategy, including objectives, focus areas and actual
initiatives.

CSR objectives should reflect the CSR issues that matter most to a company. Carrying out a risk
or materiality assessment provides a structured basis for the identification and prioritization of
CSR issues. More information on this important step is provided in Section 3.2 of the Guide.

CSR initiatives are statements that indicate what a company intends to do to address its social
and environmental impacts, to maximize benefits and to manage risks. CSR initiatives should be
clear and concise plain language statements.

When choosing among possible CSR initiatives, there are many considerations to take into
account, including:

• the size of the risk or opportunity;

• the extent to which the risk or opportunity can impact a business;
• the estimated effectiveness of possible actions;
• the ease of implementation;
• the financial and human resources needed to implement the changes;
• legal and customer requirements; and
• the speed with which decisions can be implemented.

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 Additionally, consider the following when developing initiatives:

Initiatives might:

• set minimum standards for a company; or

• define performance standards that a company aspires to meet, such as complying with a
voluntary standard and certification scheme.

Initiatives will normally include reference to:

• the scope of CSR topics to which they apply;

• specific actions to be carried out;
• the expected outcome; and
• any external framework or standard that your company will apply.

Initiatives may also include:

• a timeline for implementation or delivery;

• management actions to be taken;
• types of data to be collected;
• the indicators that will be used for evaluation and reporting; and
• collaborations or partnerships to pursue.

The end goal of this exercise is to develop and to prioritize CSR initiatives based on their
alignment with a company's business strategy, ease of implementation and anticipated pay-offs.

Voluntary Labelling Standards

Codes and standards are often linked to third-party verification or certification labelling
programs. Careful examination of the codes' terms at the outset - to make sure they are
compatible with your company's mission and culture - can reduce the likelihood of not meeting
the initiative's objective; there may also be investments required for companies to "get up to
code."

The following are examples of CSR initiatives developed by various companies – the first set
includes broad and high-level statements that demonstrate in which areas the company will focus
its CSR initiatives and the second set of examples illustrate specific actions that the company
will carry out.

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 Bridgehead Coffee's vision, mission and values

Vision: We link our customers with small-scale farmers in the developing world through sustainable fair trade.

Mission: We demonstrate that business can be socially responsible and profitable. We strive to provide the highest
quality products and service for our customers, while honouring these core values:

Values:

• We maintain fair trade as the founding principle of our business.

• We encourage community building locally and globally.
• We create premium products for our customers.
• We use organic and locally produced products wherever possible.
• We consciously reduce our environmental impact.
• We encourage a healthy, open and inclusive work environment.
• We provide ongoing education and growth for employees and customers.

Teck's vision statement

As part of the corporate sustainability strategy, Teck has developed vision statements relating to each of
their key sustainability issues. Below are two examples:

Water: contribute to the ability of present and future generations to enjoy a balance between the social, economic,
recreational and cultural benefits of water resources, within ecologically sustainable limits.

Community: collaborate with communities so they genuinely benefit in a self-defined and sustainable manner from
our activities and products. Communities consider themselves better off as a result of their interactions with us and
offer broad support for our efforts.

The Co-operators Group Limited vision, mission and values

Vision: The Co-operators aspires to be valued by Canadians as:

• A champion of their prosperity and peace of mind.

• A leader in the financial services industry, distinct in its co-operative character.
• A catalyst for a sustainable society.

Mission: Financial security for Canadians and their communities.

Statement of values

At The Co-operators we:

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 • Strive for the highest level of integrity.
• Foster open and transparent communication.
• Give life to co-operative principles and values.
• Carefully temper our economic goals with consideration for the environment and the well-being of society
at large.
• Anticipate and surpass client expectations through innovative solutions supported by mutually beneficial
partnerships.

Co-operative principles include:

• voluntary and open membership;

• democratic member control;
• member economic participation;
• autonomy and independence;
• education, training and information;
• co-operation among co-operatives; and
• concern for the community financial.

Subsequently, the following companies demonstrate examples of specific initiatives, which can
usually be measured using quantitative or qualitative methods.

Examples of specific company initiatives

Mountain Equipment Co-op (MEC) initiatives related to product design and community
investment:

• Increase the volume of bluesign® approved MEC-brand apparel materials to 50% of all
apparel materialspurchased.
• Maintain 1% of annual gross sales to support the outdoor community and maintain
MEC's commitment to "1% For The Planet."
• Divert at least 92% of waste from landfill.
• Reduce total GHG emissions by 20% from 2007 levels.17

TD initiatives for employee engagement

• Show continuous improvement in employee engagement score (calculated using an

Employee Engagement Index based on the average response to 3 questions on 'feelings of
accomplishment,' 'pride in TD,' and 'plans to be with TD in one year.'
• Provide diversity and inclusion training for all employees in North America.18

Loblaw's initiatives for food safety and quality

• Obtain 100% of seafood from sustainable sources by the end of 2013. Achieve 100%

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 Global Food Safety Initiative (GFSI) certification for control brand vendors.
• Convert all control brands to meet the federal government's recommended maximum
sodium requirements by 2016.19

Blackberry initiatives for supplier auditing

• Audit 50 suppliers against the Blackberry Supplier Code of Conduct, which is based on
the Electronics Industry Citizenship Coalition Code of Conduct, comprised of topics
related to labour, ethics, environment, and health and safety. 20

Ford initiatives for product design

• Expand the use of the Product Sustainability Index (PSI) and Design for Sustainability
principles in product development.
• Reduce global facility CO2 emissions per vehicle by 30% by 2025 compared to a 2010
baseline.
• Use at least 25% recycled content in seat fabrics on all new and redesigned vehicles sold
in North America. 21

Kraft Foods

• Obtain 100% of its raw materials from sustainable sources for its European coffee brands
by 2015. 22

Cascades

• Reduce the discharge of effluent per saleable metric tonne by 6% by 2012.

• Increase the use of recycled fibres and virgin fibres that are Forest Stewardship Council
certified (or equivalent) to 86.3% by 2012.

Collaboration in the Supply Chain – The MACH Initiative

The MACH Initiative was launched by the Quebec aerospace cluster, Aéro Montréal, in June 2011. MACH is
designed to optimize the performance of Quebec's aerospace supply chain and increase its global competitiveness.
Through the initiative, approximately 20 Quebec aerospace suppliers will be provided training, continuous
improvement and, among other services, business development support. The suppliers will also benefit from the
expertise and guidance of eight world-class Original Equipment Manufacturers (OEMs) and systems suppliers.

MACH aims to strengthen Quebec's supply chain structure and the companies involved in it by facilitating
collaboration between customers and suppliers, and by promoting the implementation of strategies and projects to
close existing integration gaps in the Quebec aerospace supply chain. Key elements of the Initiative focus on
creating joint environmental programs related to water use and to transportation, and enhancing community benefits
related to international development and childhood education.

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Developing a supply chain policy

Supply chain management can be a key component of your CSR strategy. Your supply chain can be the source of
many risks as well as opportunities. In order to manage these effectively, consider using the following tips to create
a supply chain policy:

• have a clear purpose or statement of intent;

• clearly set out the minimum expected standards, for example, related to the working conditions of your
partners;
• reference internationally recognized human rights instruments such as the Universal Declaration on Human
Rights and core International Labour Organization (ILO) conventions;
• have accompanying guidance notes so that those responsible for sourcing can give meaningful guidance to
suppliers;
• consider putting CSR information and commitments into contracts;
• detail how the supply chain will be managed and monitored, and how performance on issues such as labour
rights or economic standards will feed into appraisals and the renewal of contracts.23

III. Build support with senior management and employees

Are all of a company's leaders supportive of adopting a CSR strategy? What do the employees
think?

Without the backing of a company's leadership, a CSR strategy and initiatives have little chance
of success. A CSR team should therefore report to senior management about the findings of the
assessment and should seek support for moving ahead on the proposed strategy and initiatives. It
is equally important to continue to build support among employees, given the key role they will
ultimately play in implementing CSR initiatives.

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 Board level buy-in at Sprint

Sprint has made sustainability a board-level agenda item. Sustainability is part of the company's formal board
review process, its annual review, and at nomination and governance committee meetings. Board members go over
the company's sustainability performance and consider the company's progress against its goals.24

IV. Set performance indicators

How can progress and achievements be monitored?

After having finalized CSR initiatives, the next step is to set performance indicators that are
aligned to the initiatives. These indicators allow a company to measure whether it is executing its

CSR initiatives, and can be used to inform adjustments in approach or resources be necessary.
When developing CSR indicators, it is best practice to follow the SMART guidelines:25

The following boxes provide various examples of performance indicators:

Initiative Reduce the amount of waste sent to the landfill

Key performance indicator Reduce solid waste by 25 percent by the end of the year
The kilograms of garbage produced each month, which are
Measurement method
recorded and monitored

To improve relations with the community, double the

Initiative number of town hall meetings a company holds and reduce
the number of complaints by half
The number of town hall meetings and the number of
Key performance indicator
complaints at the end of the year
Quarterly tallying of meetings and complaints which are
Measurement method
recorded and monitored

Do not offer improper payments to officials since all

Initiative employees are aware of the company's requirements and
legal obligations

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 Training course developed and implemented as part of
Key performance indicator employee induction training, and regular updates are
provided for all staff
Whether training program is implemented and the number
Measurement method
of staff trained as a percentage of total staff

In all three cases, a regular review of the initiative's objectives against the indicator might lead a
company to modify the indicator, as it is not capturing the objective. For instance, in the second
example above, a company might conclude that increasing the number of town hall meetings did
not improve community relations, since underlying problems were not also addressed. As a
result, a better objective might be increasing the number of resolved complaints. It is also
important to revisit and to re-evaluate targets over time as performance and operating priorities
change.

Reality Check

Now that we've set some initiatives with performance indicators, what happens if we don't reach
them?

Presenting a balanced description of a company's performance, both positive and negative, is an

important way to build trust with stakeholders. Describing the key actions, programs or changes
that a company has put in place to address the problem of not meeting an initiative is a good way
to communicate about a company's approach to sustainability. In the end, balanced reporting is
integral to maintaining trust and to ensuring reputational benefit.

V. Hold discussions with major stakeholders

Once CSR initiatives that are supported by management have been drafted, it is likely that they'll
generate interest from external stakeholders. Consider, therefore, engaging with the following
stakeholder groups:

When initiatives apply to these parties, their involvement and agreement

to comply with the terms of any initiative is critical. Try to understand
their perspective by asking:
Business partners,
customers, supply
• What matters most to their organization?
chain partners and
• How will initiatives in these areas impact on their business?
contractors
• What opportunities or challenges might emerge in
implementation?

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 Reaching out to consumers, shareholders, labour and environmental
organizations, community groups and/or governments can help a
business to understand these groups' interests and concerns, and could
build support for a company's CSR initiatives. Try to understand these
groups' perspectives by asking:
Broader stakeholders
• Are the right areas being focused on?
• What are their expectations?
• How high should the initiatives aim?

VI. Review and publish a strategy and initiatives

Once final initiatives and performance indicators have been drafted a final review should be
carried out, with a focus on the following key themes:

• the adequacy of the initiatives to manage the CSR issues important to ad business and to
its stakeholders;
• whether the initiatives will likely lead to the desired outcome;
• the links between the initiatives and the business case; and
• the feasibility of implementing the chosen initiatives.

Ultimately, final focus areas, initiatives and indicators should be reviewed and endorsed by
senior management and the board, if applicable. Once the strategy has been finalized, it should
be shared with employees, business partners and other stakeholders. Making initiatives public is
critical to building trust in a company's CSR strategy and in mobilizing the support needed for
implementation. Accordingly, the next section provides guidance on how to implement a CSR
strategy.

CSR and small business

"Our organization is very small and we don't have many strategies other than growing our
business. This process seems too complicated for us."

Developing a CSR strategy does not have to be complex. Start by picking one area to focus on
based on an easily achievable goal. For example, a company could decide to start making a
difference by putting in place a recycling program, by providing tele-work opportunities to
employees once a week, or by outlining energy-saving tips for around the office. Record the
CSR initiatives that have been implemented and build on those successes year after year. A
strategy will become apparent from the priorities that emerge and the actions taken.

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 Reality Check

"I can see the CSR leadership team and even our executive team getting excited about
developing a strategy of this nature. What I can't see is our over-extended middle-management
group getting excited about it. In fact, I can see them pushing back, challenging its importance
and relevance."

That is why it is so important to invest time in developing a business case for CSR. Use the same
systems and formats as for justifying a reallocation of funding to a new initiative, engaging the
finance team in the process. Demonstrating how a CSR strategy and initiatives support existing
business objectives is an integral part of building support at the middle management level.

2.4 Task 3: Implement a CSR Strategy and Initiatives

In this section you will learn:

• What CSR implementation is and why it is important

• How to implement a CSR strategy

2.4.1 What is CSR implementation?

Implementation refers to the day-to-day decisions, processes, practices and actions that ensure
that a company carries out its CSR initiatives, thereby delivering on its CSR strategy.

It is through the process of implementation that a company should realize the value of its CSR
strategy and initiatives – delivering on efficiencies, generating value, realizing new business
opportunities and minimizing risks.

CSR – A really big change management exercise

The speed at which a company implements sustainability initiatives is different for every
organization. For all organizations, however, taking real steps towards sustainability requires
fundamental changes to the way that:

• leadership thinks about its business objectives;

• employees think about the work that they do and how they do it; and

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 • processes and procedures drive performance towards economic, environmental and
social objectives.

Fundamental change is not easy or quick, but taking steps towards increased sustainability will
help an organization to grow its reputation as a corporate citizen; retain and attract talent; reduce
operational costs; and better understand how an organization learns, grows, and adapts to
changing market conditions and expectations.

2.4.2 How to implement a CSR strategy

Every company is different and will approach CSR implementation in different ways. The steps
below demonstrate one way to implement CSR initiatives.

I. Develop an integrated CSR decision-making structure

Given a company's existing mission, size, sector, culture, organization, operations and risk areas
– and given its CSR strategy and initiatives – what is the most effective and efficient CSR
decision-making structure to put in place?

The following includes considerations to take into account when designing a CSR decision-
making structure.

Considerations for implementing a company's CSR strategy

1) Identify people or committees at the top levels of the company who will assume key CSR
decision-making and oversight responsibilities.

• Assigning CSR responsibilities to senior management ensures that CSR issues will
receive the attention they deserve and forms a strong basis for an effective chain of CSR
accountability within the organization - all of which can support a board's corporate
governance function.

There are several options for board participation:

• a sitting board member could be tasked with broad responsibility for CSR activities;
• a new member who has specific CSR expertise could be appointed;
• CSR responsibilities could be added to the work of existing board committees;
• a new CSR board committee could be formed; or
• the entire board could be involved in CSR decisions.

2) Ensure it is visible to all employees.

• CSR initiatives help to drive transparency, accountability and performance. Ensuring the

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 CSR decision-making structure and roles are visible to all employees will help to support
delivery.
• CSR responsibilities should be built into job descriptions and performance evaluations.

3) Establish accountability throughout your organization.

• Accountability should start with the board and follow through to the executive and senior
levels, supported by coordinated cross-functional decision-making and specialized staff
expertise.
• A senior official or committee responsible for overall CSR implementation within a
company should be identified and given the resources to do the job. Particular
departments having CSR responsibilities (e.g., environmental, health and safety, worker
relations, supplier relations, community relations, customer relations, investor relations)
could report to the senior official or committee.

Further, employee support for CSR implementation can be maintained in a number of ways, for
example by:

• identifying and engaging CSR champions;

• incorporating CSR performance indicators into business plans;
• providing regular updates on progress (in meetings or the company newsletter);
• developing incentives (such as rewards for best suggestions);
• removing or reducing disincentives (e.g., competing interests, such as premature
deadlines, seeing cost as the only consideration when choosing suppliers, or resource
constraints that encourage employees to choose non-CSR options); and
• celebrating CSR achievements, motivating teams, and building enthusiasm and pride.

II. Design and conduct CSR training

What knowledge and skills do employees need to implement CSR initiatives?

Training can be a key enabler for delivering on a CSR strategy and initiatives. Training addresses
knowledge, skills and attitudes, and is most effective when the learner has input into the
development of the learning process. There are five steps to establishing a successful training
program:

• conducting a needs analysis;

• setting learning objectives;
• designing the program (i.e., content, format, logistics, timing, duration);
• implementing the program; and
• evaluating the program against the learning objectives.

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 Developing CSR training

Implementing a CSR strategy requires employees with skills, expertise and capabilities in a range of disciplines,
processes and practices. Training is an important tool to ensure employees have the necessary skills. The skills
needed, and the focus of any training, may vary substantially across different organizational roles, from senior
managers who have responsibility for engaging with a company's stakeholders, to those with responsibility for
implementing a management system, to those who must appropriately manage a company's waste.

Undertaking a training needs assessment can help to target training courses at key skill gaps and needs.

Existing sustainability training resources

• The Accountability Project Sustainability Training

• Sustainability Learning Centre
• Canadian Business for Social Responsibility webinars
• Conference Board of Canada webinars
• Webinaires du Réseau entreprise et développement durable

III. Establish mechanisms for addressing problematic behaviour

What could go wrong and what can be put in place now to ensure it's handled appropriately?

Early detection of activities that are contrary to CSR principles and initiatives is important to
ensure the continuous and smooth implementation of a company's CSR strategy. For this reason,
it is important for a company to put in place mechanisms and processes that will allow for the
early detection, reporting and resolution of problematic activity.

A company should devise approaches that are sensitive to the vulnerable position of employees
that report wrongdoing, or a potential non-compliance with any of the CSR initiatives. In
addition to clear and fair guidelines on how to report a breach of CSR initiatives, a company
could consider anonymous hotlines, email boxes and ombudspersons.

For more specific guidance on whistle-blowing mechanisms, see the U.K.-based Public Concern
at Work website or visit Ethics Practitioner's Association of Canada.

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2.5 Task 4: Communicate Performance

In this section you will learn:

• What CSR communication is and why it is important

• How to communicate your CSR activities

79% of Canadians are interested in learning how companies are trying to be socially
responsible.26

2.5.1 What is CSR communication?

Communicating on CSR initiatives and performance is a critical competency for successful

companies. Communicating provides the basis for informed decision-making by interested
parties who may wish to purchase a company's products, to invest in a company or to support a
company's activities in their community. The goal is to communicate CSR progress in a
meaningful way that will attract positive attention to a business and that will engage
stakeholders.

Other benefits of CSR communication can include:

• higher levels of customer satisfaction and loyalty;

• improved company, brand and product reputation;
• more motivated and productive employees;
• better relations with the local community and public authorities; and
• improved access to financing.

2.5.2 How to communicate a CSR strategy and initiatives

The steps below describe one way to develop a CSR communications strategy.

I. Establish a target audience and objectives

With whom should communication be established? What impact is desired through

communication?

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The first step in communicating on CSR is to identify the individuals and groups that a company
would like to target regarding its CSR communications. It is then helpful to define
communication objectives for each stakeholder group. For example, communications targeted at
employees may be designed to strengthen employee engagement and satisfaction. The following
table lists possible target audiences for CSR communications.

Common audiences

• Employees • General public

• Customers/consumers • Trade unions
• Local community • Public authorities/regulators
• Media • Local organizations or institutions
• Consumer associations • Not-for-profit / non-governmental
• Suppliers organizations
• Business partners • Prospective employees
• Investors • Aboriginal communities

II. Choose a message

How to decide what to communicate.

For market facing stakeholders

If a target audience is the market in which a company operates (e.g., customers/consumers,

investors, business partners, consumer associations, or suppliers), focus on how you integrate
CSR initiatives into business operations, or highlight performance achieved. For example,
describe initiatives related to supporting local suppliers, product quality and safety, fair
purchasing, reductions in energy and water use, sustainable packaging, certification against a
voluntary ethical standard, emissions reductions, environmental manufacturing, working
conditions and human rights practices, reduced waste and hazardous waste generation, and/or
sustainable sourcing.

For community facing stakeholders

If a target audience is the community where a company operates (e.g., local community, local
media, prospective employees, not-for-profit / non-governmental organizations, local
organizations or institutions, or public authorities), describe commitments to health and safety
conditions, investments in the local economy, such as by working with local enterprises, or how
CSR initiatives contribute to a healthy and natural environment, or your support for local groups
through donations, sponsorships and volunteering.

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For internal stakeholders

If a target audience is a company's workforce (e.g., employees and trade unions), describe CSR
initiatives related to job safety, work/life balance, diversity in the workplace, training and
professional development, corporate culture, and/or values-driven practices.

III. Decide how to communicate

How to get your message across? What is the most effective medium for communications?

The most effective media and communication channels for CSR communication vary depending
on the audience and the objectives of the communication. Options vary from launching an
awareness campaign to featuring CSR initiatives in advertising and speeches. Whatever the
approach, ensuring that the message and the medium match the intended audience and objectives
is critical.

Types of CSR communication approaches

Internal stakeholders

• Employee training and education

• Employee updates

External stakeholders

• Sustainability and integrated reporting, e.g., annual reports

• Advertising, websites, social media
• Information packages, brochures, newsletters and mailing lists
• Point of sale materials and salesperson assistance
• Media and events

The next section explains some of these approaches in more detail.

Reporting

A CSR report (also called a sustainability report) enables companies to report sustainability
information in a way that is similar to financial reporting. Systematic sustainability reporting
gives comparable data with agreed disclosures and metrics. A CSR report provides information
about economic, environmental, social and governance performance.

For more detailed guidance regarding CSR and sustainability reporting, and the key steps
involved, please see the “Reporting” section in Part 3.

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Advertising, websites and social media

Advertisements are an effective way to get consumer attention for a company's CSR initiatives,
and may also attract new employees who wish to work for a responsible company. Consider
using values-based messaging that reflects consumers' motivations for buying environmentally
and socially responsible products and services. Adding CSR information to a company's website
ensures that parties can easily access information of interest, and can also be a place to showcase
CSR performance information. Consider investing in interactive features to engage and to inform
customers.

Engaging current and future clients, employees, and business partners through social media
about CSR initiatives and performance is a low cost and effective measure.

Social media tools such as Facebook or Twitter allow a company to connect with thousands of
followers instantaneously to share CSR-related material and to receive feedback faster and
cheaper than through any other medium.

The following boxes describe how selected companies are using social media as an effective tool
to promote and to communicate on their CSR initiatives and performance.

Mountain Equipment Co-operative (MEC)

Mountain Equipment Co-operative (MEC) uses Twitter to connect with almost 30,000 customers
and has achieved over 135,000 “likes” on its corporate Facebook account, which has worked to
promote the co-operative's various initiatives; MEC's CSR-related postings are available on their
Facebook account.

SoftChoice's CSR Blog

For its third Sustainability Report, SoftChoice, a North American information echnology
company, created a CSR blog to communicate their key initiatives and progress relating to
sustainability. "Rather than offering a static, point-in-time snapshot of our efforts, we have
created a real-time, interactive blog," says Melissa Alvares, Sustainability Programs Manager at
Softchoice. "Our aim is to create a living record of our work that encourages engagement and the sharing of
ideas from both within and outside our organization."

Tailor your report to the target audience

A large glossy report will not be effective for all audiences. For example, an on-line snapshot of
your performance may provide the information most customers require. Those who want further
details can download a more in-depth version.

Information packages, brochures, newsletters and mailing lists

Information packages, brochures, flyers, leaflets, and mailing lists allow audience-specific
information to be disseminated strategically. Brochures can be sent to business partners and
suppliers, while information packs could go to investors, trade unions and consumer

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associations. Building a mailing list is an easy way to gain market intelligence on stakeholders,
and is a way to provide regular updates on activities.

Point-of-sale information and training salespeople

Providing point-of-sale information on your products and services, for example, by using
packaging, signage, or a salesperson, may be the factor that influences someone to choose one
company's brand over a competitor's. As such, buyers may be interested in knowing:

• the environmental characteristics of a product and its packaging (e.g., if it is energy

efficient, biodegradable, non-toxic, made from recycled materials, organic, etc.);
• who made it and how (e.g., made locally, made abroad with fair trade labour, made with
sustainably sourced materials, hand-crafted, etc.); and
• if a proportion of profits go to support community initiatives, charities or not-for-profit
organizations.

Media and events

About one-third of Canadians learn how companies behave on social issues through news
media.27 Getting information on CSR initiatives into newspapers, blogs and radio is an excellent
way to raise the profile of a business; press releases and interviews are the most common
approaches to engaging the media.

Another way to spread news about your CSR initiatives is by attending issue-related events, and
by seeking out speaking and presentation opportunities. If there are no relevant events near a
company's location, consider partnering with a local organization to host an event, allowing a
company to showcase its achievements and to engage in a broader dialogue with stakeholders.

CSR and small business

"We definitely do not have the resources to hire a professional firm to develop a SR report. How
do we share information about our CSR efforts despite these limitations?"

The easiest route for reporting is to post information on the company website or on social media.
This is an inexpensive way to give an update on current CSR initiatives, including both successes
and areas for improvement. A small organization can report to its business partners and staff at
regularly scheduled meetings. By adding a few sections to basic company literature (brochures,
pamphlets), small business owners can communicate CSR activities to their suppliers, customers
and community.

The final task in the CSR implementation framework has to do with reviewing and scaling-up a
CSR strategy; the next section turns to this topic.

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2.6 Task 5: Evaluate and Scale-up

In this section you will learn:

• What is a CSR evaluation and why it is important

• How to review and scale-up a CSR strategy and initiatives

2.6.1 What is a CSR evaluation?

In a CSR evaluation, a company reviews its CSR strategy, initiatives, and performance, and
identifies opportunities for improvements and modification. Reviewing and evaluating a CSR
approach is about learning and is the fundamental step to ensuring continuous improvement.

An evaluation allows a company to do the following:

• to determine what is working well, why and how to ensure that it continues;
• to investigate what is not working well and why;
• to explore the barriers to success and what can be changed to overcome them; and
• to revisit original objectives and to make new ones, if necessary.

This base of information should allow a company to determine whether the current CSR
approach is achieving its objectives and whether the implementation approach and overall
strategy are correct. The goal is to understand which areas of a business are improving with
respect to CSR, and which areas need further attention, and how to improve them.

CSR and small business

"How is a CSR review different from the self-evaluation that we did a year ago? This seems like
an extra piece of work."

Reviewing progress at periodic intervals ensures that a company has an opportunity to identify
and to act upon new challenges and opportunities that have arisen. Without regular reviews,
there is a danger that a company will repeat problematic practices and will fail to act upon
changes in products or processes that could open up new markets. The results of regular
evaluations should reveal a company's progress. When the evaluation results have improved,
then a company is probably on the right track. When the results have stayed the same or even
decreased, then the CSR strategy may need to be revised.

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2.6.2 How to do an evaluation

A company could consider the following questions for guidance in preparing its CSR evaluation:

• What worked well? In what areas did a company meet or exceed its targets?
• Why did it work well? Were there factors within or outside a company that helped it to
meet its targets?
• What did not work well? In what areas did a company not meet its targets?
• Why were these areas problematic? Were there factors within or outside a company that
made the process more difficult or that created obstacles?
• What did a company learn from this experience? What should continue and what should
be done differently?
• Drawing on this knowledge and information concerning new trends, what are the CSR
priorities for a company in the coming year? Are there new CSR objectives?

The evaluation should involve seeking input from management, a CSR team, employees and
external stakeholders.

Reality Check

"I don't get it. What will an evaluation tell us that our $60,000 CSR report doesn't?"

The review stage is critical. It is really about sitting down and understanding what the CSR
report is saying. What goals were set but were not actually achieved? Why? Are the reporting
indicators the right ones? Are they aligned with a company's mission? Is the company engaging
the right stakeholders? Are the right people working on advancing CSR inside a company? This
is the stage to reflect on what needs to stay the same and what needs to change; it is critical to the
continuous improvement of CSR performance.

2.6.3 Scaling-up a CSR approach

It is also important to think about next steps and about how to scale-up your CSR strategy. The
Canadian Business for Social Responsibility (CBSR), which is a non-profit member organization
with a mission to accelerate and scale up corporate social and environmental sustainability in
Canada, has developed a road map for companies consisting of 19 aspirational and inspirational
qualities which can help a company transition to a "transformational" company. The 19 qualities
in the road map describe what visionary companies do, how they do it, and with whom they
interact. This approach could provide helpful insights for scaling-up an existing CSR strategy.
For more information on the transformational company approach, visit the CBSR's website.

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Part 3 – Key CSR Issues
3.1 Engaging stakeholders
This section provides additional guidance on the critically important topic of stakeholder
engagement.

3.1.1 What is stakeholder engagement?

A stakeholder can be defined as "an individual, or group of individuals, with interests that may
affect or be affected by an organization."28 Who stakeholders are varies greatly from one
company to another and can include suppliers, local community members, employees, investors,
non-governmental organizations, citizens and customers.

Defining Stakeholder Engagement

"Stakeholder engagement involves interactive processes of engagement with relevant

stakeholders, through, for example, meetings, hearings or consultation proceedings.
Effective stakeholder engagement is characterized by two-way communication and
depends on the good faith of the participants on both sides. This engagement can be
particularly helpful in planning and in decision-making concerning projects or other
activities involving, for example, the intensive use of land or water, which could
significantly affect local communities." 29

Engagement comprises both formal and informal ways of consulting and achieving the
participation of the parties who have an actual or potential interest in, and effect on, your
company. Consultation is the process of establishing a two-way dialogue with stakeholders. It
implies understanding the views of stakeholders and taking those views into consideration, being
accountable to stakeholders when accountability is called for, and using the information learned
to drive innovation and business success.

Below are the five basic levels of engagement, adapted from the International Association for
Public Participation's Spectrum of Participation.30

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Note that in this example the stakeholders are always referred to as the public; of course,
stakeholders can vary from internal units to external organizations and can represent a wide
range of public and private interests.

3.1.2 What are the benefits of stakeholder engagement? Why does it matter?

One way to understand the importance of engagement is to look at what can happen when it is
not done: customers see a company as unresponsive to their needs; employees feel
unappreciated; suppliers lose trust in a company; communities become uncooperative; and
investors get nervous. Three key reasons, therefore, for engagement include building social
capital, reducing risk and fuelling innovation. The following table elaborates on these points.

Benefits Outcomes
• Improved access to information and
• Facilitates coordination intelligence regarding stakeholder
and cooperation. positions.
Build social
• Maintains a company's • Support for a company's operations.
capital
'social license to operate.' • A company may receive the benefit of the
doubt should unexpected issues arise.

• Reduces the probability of having to

• Helps to identify
make costly investments to address
Reduce risk emerging issues.
unforeseen issues.

• Revising and developing new products

• Helps to identify
Fuel and services to better meet the demands
business opportunities.
innovation of customers and clients.

3.1.3 Using stakeholder engagement to implement a CSR strategy and

initiatives

The following steps highlight how stakeholders can be engaged at each step of the framework
presented in Part 2 of the Guide.

During the planning phase, stakeholders can assist in identifying a company's

Plan Environmental, social and economic impacts, in identifying mitigation and
compensation measures, and helping to develop a company's strategy.
Shifting from planning to doing, stakeholders can play an important role in developing
Do
and implementing a company's CSR initiatives.

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 During the checking stage, stakeholders can be integral to verifying the effectiveness
Check
and implementation progress of a strategy and initiatives.
Finally, the input of stakeholders can be crucial to a company's evaluation and
Improve improvement activities. They can assist a company in identifying both areas and issues
that need improvement and the ways to achieve the improvement.

In all phases, approaches to stakeholder engagement should be practical and transparent, and
tailored to the abilities and needs of a company and its stakeholders.

CSR and small business

Engagement is a great way to check whether a company's CSR approach resonates with those
with whom the company interacts. Still, small business owners and managers might think,
"Stakeholders? I wouldn't know where to begin finding them let alone engaging them in our
decision making. Do we really need to do this?"

Begin simply by determining main stakeholder groups – most often employees, customers and
the local community. For a small company, creating a forum for stakeholders to provide input
may be as simple as using social media or setting up an email account for anyone to ask
questions and make comments about products or practices. Another way might be to hold a
community open house or host an information table at a local or community event. Note that it is
critically important to respond to or comment on input received.

3.1.4 How to engage with stakeholders

A five-step stakeholder engagement process is set out below. Note that the order and the steps
suggested here only represent one way of approaching engagement. Overall, best practice in this
area is about identifying specific actions that will lead to integrating the participation of
stakeholders into a company's decision-making process.

I. Identify stakeholders

The location, scale and nature of a company's operations and products or services will determine
which groups or individuals see themselves as stakeholders. Stakeholders will be most interested
when a company's actions have a direct or immediate effect on them. People or organizations
who have no direct connection to a company, however, may also consider themselves
stakeholders, such as families of employees, those who live in the communities where a
company is located, or an organization that is against a position that a company is taking.

Once a company has identified its key stakeholder, the next step is to perform a stakeholder
mapping exercise; for more information on a stakeholder mapping exercise, please revisit section
2.2.2 of the Guide.

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Following a stakeholder mapping exercise, it is also important to prioritize the groups of
stakeholder's that a company plans to engage. The following criteria may provide a basis for
prioritizing a company's stakeholder groups:

Level of Impact What is the significance of a company's initiatives on key stakeholders?

Importance to How key is the stakeholder group to operations, such as customers and key
operations suppliers, or to the risk of work stoppages, such as community opposition?
By excluding a stakeholder group, is there a risk of getting incomplete
information?
Risk of incomplete
• For example, when a foreign subsidiary's only contact is with
information
government officials it may be difficult to know the position of
local workers or residents.

Could consulting with a stakeholder group lead to the opportunity to

access new ideas?
Access to new ideas
• For example, engaging a group that is likely to challenge current
practices may provide fresh insight into a difficult problem.

Is the stakeholder associated to any requirements of regulators or permit-

issuing problems?
Regulatory
• For example the requirements of Section 35 of the Constitution Act
requirements
may mean that a company is required to engage with Aboriginal
peoples.

II. Understand your reasons for engagement

A company may undertake engagement for a range of business reasons. Identifying the business
driver will help to inform a company's approach. As such, reasons for engaging with a
stakeholder could be to:

• better understand a company's business impacts;

• seek input on a company's business values, mission, strategy and initiatives;
• build support for a CSR implementation plan;
• facilitate a regulatory approvals process;
• participate in CSR performance measurement and reporting;
• avert or solve a crisis;
• identify and manage risks;
• initiate action to improve relationships; and
• understand stakeholder interests and needs.

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It is important to be clear with stakeholders about their role before engaging. Will the role of
stakeholders be advisory or participatory? Is a company prepared to change its plans
significantly based on what it learns? It is also important to note that the demands on some
stakeholder groups to participate in consultation processes have become so great that
sophisticated stakeholders are not willing to contribute much energy to processes in which they
have little influence.

Quick tips

• Prioritize which stakeholders to engage with in terms of their ability to

impact positively or negatively on a company.
• Make sure to know in advance why engage with specific stakeholders and
how to engage with them.
• Consider using professional facilitators or consultants to assist in
constructing an effective engagement process.

III. Plan the engagement process

The engagement plan should be sensitive to the needs and approaches of different stakeholder
groups and any subgroups. Consider carefully who is targeted as participants to ensure that they
are representative of target groups, that they reflect the range of stakeholder interests, and that
they have the legal and/or moral authority to speak for their group.

Select the appropriate engagement approach. This could be:

• focus groups or consultation workshops;

• individual or small group interviews;
• surveys;
• formal referrals;
• key-person meetings; and
• advisory councils or some other forum.

The approach chosen should reflect the engagement objectives, stakeholder capacity, cost and
time constraints, and whether qualitative or quantitative information is required. The engagement
plan should also take into account cultural sensitivities such as language, traditional holidays,
gender-roles and appropriate modes of communication. Consider seeking outside help; a
professional facilitator or consultant can help with the details of the engagement plan.

IV Maintain the dialogue and deliver on commitments

After the dialogue and engagement process have commenced and there is agreement by both a
company and the stakeholders on the approach and deliverables, it is important for the
participating parties to deliver on their engagement commitments. The dialogue should be

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maintained in accordance with the process that has been endorsed. Successful engagement can
lead to further dialogue, to partnerships and to the future participation of stakeholders in decision
making.

Reality Check

"We've tried engaging stakeholders and all we do is listen to a torrent of criticism often from
people who don't understand our business or just want to shut us down. I don't know why we
would do this given that our competition doesn't bother and their share price isn't doing any
worse than ours in the market today."

Listening to the sometimes critical views of stakeholders may not be very pleasant, but it does
provide companies with an opportunity to learn more about perceived problems, and it provides
a basis for constructive action. There are many examples of companies who have done this, and
as a result have gained a competitive advantage over other companies due to the information
acquired and the lessons learned.

IAMGOLD describes their approach to stakeholder engagement in their 2011 Sustainability

Report:

"Our engagement approach is unique to every site. The frequency and intensity of our meetings depend on the local,
regional and national stakeholder context. While each site has the flexibility to design their own engagement
program, guidance is provided at various levels, which includes:

1. The Sustainability Policy

2. The Sustainability Framework
3. The Community Relations Handbook
4. The Community Relations Audit Tool

Overall, our engagement is guided by principles of honesty, transparency and the construction of meaningful
relationships. Engagement is done on both an ad hoc and systematic basis. We respond to incoming questions from
communities, civil society, investment firms and others, but we also have management systems that set out ongoing
engagement schedules, track meetings and measure the general satisfaction of our engagement. We meet with
stakeholders in formal settings, like the Annual General Meeting, community open houses or in scheduled meetings
with community consultation committees. We also take advantage of less formal opportunities such as individual
consultations and community 'walk abouts', which also give stakeholders the opportunity to voice any concerns or
interest they may have in the company."

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3.1.5 Working with Aboriginal peoples

In Canada, the Aboriginal and treaty rights of Aboriginal Peoples are recognized and affirmed in
Section 35 of the Constitution Act. The Aboriginal Peoples of Canada include Indian (commonly
known as 'First Nations'), Inuit and Métis.

The Aboriginal population in Canada is the fastest growing demographic in the country.31
Significant growth in Canada's resource sector means that the number of intersection points
between Aboriginal communities, industry and government is on the rise. As such, Aboriginal
people are becoming an increasingly important source of skilled employees and are presenting
companies with a growing market for products and services.

In the Haida and Taku River decisions in 2004, and the Mikisew Cree decision in 2005, the
Supreme Court of Canada held that the Crown has a duty to consult and, where appropriate,
accommodate when the Crown contemplates conduct that might adversely impact potential or
established Aboriginal or Treaty rights. This drives many companies to be proactive in engaging
with Aboriginal people and/or communities who might be affected by a company's operations. It
is important to note that industry's overall relationship with Aboriginal groups, including its
business practices, can assist the Crown's overall consultation and accommodation efforts. Given
this judicial environment, companies should not see Aboriginal people as a traditional
stakeholder.

Canadian companies are recognizing the value of working with Aboriginal peoples, communities
and companies to develop mutually beneficial relationships. The benefits to companies could
include:

• earning the 'social license' to operate;

• access, especially in remote areas, to a diverse workforce, to suppliers and to contractors;
and
• minimizing business risks.

Good practices related to Aboriginal relations can include:

• integrating Aboriginal relations into the governance and management of a company (e.g.,
representation on a board of directors or developing an Aboriginal relations policy);
• building programs and activities to support Aboriginal employment (e.g., skills training
or mentorship programs for Aboriginal employees);
• making community investments (e.g., scholarships or supporting local cultural events);
and
• community engagement and business development initiatives (e.g., procuring goods and
services from local Aboriginal contractors or suppliers or developing a preferential
procurement policy).

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The following boxes provide examples of how organizations and companies are effectively
working with and engaging Aboriginal stakeholder groups.

Progressive Aboriginal Relations Program

The Progressive Aboriginal Relations (PAR) Program, developed by the Canadian Council for
Aboriginal Business, is a Canadian certification program that confirms corporate performance in
Aboriginal relations at the "Bronze," "Silver" or "Gold" level. Certified companies promote their level
with a PAR logo signaling to communities that they are good business partners and places to work, and
are committed to prosperity in Aboriginal communities.
Scotiabank – attracting, retaining and encouraging Aboriginal employment
Scotiabank's employment related initiatives are considered strategically through its Human
Investment Committee comprised of the Bank's senior leadership, including its President and CEO.
Strategies are advanced through an Aboriginal relations committee with cross-departmental
representation and lead responsibility vested with a National Director of Aboriginal Relations. The
Scotiabank approach includes an employment website targeting Aboriginal youth (developed in partnership with
other financial institutions), participation in recruitment events, and a Scotia Aboriginal Network (SAN) that
supports the recruitment of interns. SAN's mission is to create an accessible and inclusive workplace for Aboriginal
employees.
IBM – strategic community contributions
IBM recognizes the value of contributing their talent and technology to Aboriginal communities
and organizations. With a focus on skills development and community relations, IBM's strategy is to
expand participation through employment and growth in Aboriginal technology companies. IBM has
developed programs to stimulate interest in math and science, e.g., I.G.N.I.T.E. (Igniting Interest in
Technology and Engineering) and to improve literacy. Programs have reached over 1,000 students, inspiring them to
stay in school and consider careers in technology.
Syncrude – Aboriginal Trades Prep Program
In 2008, Syncrude Canada Ltd. partnered with local community college, Keyano College, to develop the
Syncrude Aboriginal Trades Prep (SATP) program. The innovative program was launched a year later,
with 40 Aboriginal students from communities located across the North-Eastern Alberta region selected
for 7 months of in-school training, followed by a one-month work program at Syncrude. Upon successful
completion and pre-employment screening (i.e., health, criminal record check, etc.) the graduates are guaranteed a
job at Syncrude through an apprenticeship. Syncrude has the first right of recruitment for all participants in the
program in exchange for being the major sponsor of this initiative.

Due to the tremendous success of the Syncrude Aboriginal Trades Prep program, Syncrude has had to expand its
employee fly-in program to accommodate all of the SATP students and graduates coming out of the Fort Chipewyan
community.
Nexen Indigenous Peoples Policy

Nexen recognizes the value of building enduring and trusting relationships with Indigenous Peoples
who's legally recognized lands and traditional territories are within or in close proximity to the areas
where it operates. The intent of the Indigenous Peoples Policy is to guide the development of mutually
beneficial relationships over the lifecycle of its projects, while building business value from its engagement
activities.

The policy describes guidance in four focus areas: community engagement; business development and capacity
building; community investment; and indigenous employment.

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3.2 Risk and Materiality
Developing and implementing a sound CSR strategy requires thoroughly identifying the CSR
issues that matter most to a company. Risk or materiality assessments provide a structured basis
for the identification and prioritization of CSR issues. Information on these important business
exercises is provided below.

3.2.1 What is a risk assessment?

In any business activity there is potential for events and consequences that represent business
threats. A risk assessment is the process by which risks associated with a company's activities are
methodologically identified. Business risks can include:

• financial risks e.g., interest rates, foreign exchange, credit, liquidity and cash flow;
• strategic risks e.g., competition, customer changes, industry changes, customer
demands, merger and acquisition integration, research and development, and intellectual
capital;
• exposure risks e.g., public access, employees, properties, products and services,
contracts, natural events, suppliers, and environment; and
• operational risks e.g., board composition, culture, regulations, supply chain,
recruitment, information systems, and accounting controls.32

As such, it is important that CSR issues are systematically considered as part of a company's
overall risk management strategy.

3.2.2 What is a materiality assessment?

According to the Global Reporting Initiative (GRI), "A material CSR issue is one that
substantively influences the assessments and decisions of stakeholders or that reflects the
organization's significant economic, environmental or social impacts."

The concept of materiality has been used widely by leading global companies and is having a
profound impact on corporate strategy and on approaches to sustainability reporting. In the GRI's
guidelines, materiality is enshrined as one of the core principles for determining report content.

A company should undertake a materiality assessment to help identify key CSR issues that are
most important to a company and to its stakeholders. This type of assessment considers two
different aspects:

• the level of business impact, and

• the level of stakeholder interest.

CSR issues which are assessed as high for both aspects are considered to be the most material to
a business.

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The key steps in conducting a materiality assessment are:

• Identify key material issues

o Develop a long list of possible material issues by reviewing internal documents
and by scanning industry priorities, and then refine the list to reflect company-
specific priorities and language.
• Determine business impact
o Assess each issue for its impact on operational, reputational and financial risks.
• Determine stakeholder interest
o Assess the level of stakeholder interest in each issue by researching key
stakeholder interests.
• Analyze
o Review and validate the assessment with key internal and external stakeholders.

Material issues can be mapped on a matrix along the two scales of stakeholder impact and
business impact. The GRI provides guidance on material issue identification and assessment,
including the sample materiality matrix shown below:33

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The following box provides links to how two selected companies undertake their materiality
assessments.

Teck's materiality process

Teck provides a detailed description of the materiality process that they undertook for the
completion of their 2011 Sustainability Report; see page 9 of the report for details.

Nexen's materiality matrix

Nexen uses a materiality matrix to communicate their key sustainability issues.

3.3 CSR Reporting

In this section, more detail is provided regarding the development of a CSR report, the most
traditional approach to communicating a company's CSR performance.

3.3.1 What is a CSR report?

A CSR report enables a company to report CSR information in a way that is similar to financial
reporting. Systematic CSR reporting provides stakeholders with comparable data on corporate
performance, and uses agreed disclosures and metrics. A CSR report provides information about
economic, environmental, social and governance performance.

While many companies produce a stand-alone CSR report, it is also possible to integrate CSR
information into other company reports, including the company's annual report. Integrating CSR
information into annual reports is a particularly effective way to communicate to investors on a
company's management of CSR risks and opportunities.

A study done by SustainAbility, a UK-based consultancy, found that there are more than 100 sets
of reporting schemes that aim to measure which companies are the most responsible.34 Of most
importance, each of the big four accounting firms are expanding their practices to audit against
many of these ratings schemes – a clear sign that sustainability reporting is becoming common
practice.

The Government of Canada endorses the use of the GRI Sustainability Reporting Framework for
all companies in all sectors, as it can assist Canadian companies to measure and to manage their
economic, environmental, social and governance performance. GRI also produces special
guidance for SMEs, and sector supplements tailored to firms in sectors such as the extractives,
food processing, construction, real estate and electric utilities. It is possible, therefore, that a CSR
report uses indicators derived from the GRI framework and/or the performance indicators that a
company developed to measure the performance of its CSR initiatives.

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 Sustainability reports are becoming a standard business practice
In 2013, according to CorporateRegister.com, more than 5,500 companies around the world
issued sustainability reports, up from about 800 a decade ago.

The International Integrated Reporting Council (IIRC)

The IIRC was established in 2010 "to create a globally accepted Integrated eporting Framework
which brings together financial, environmental, social and governance information in a clear, concise,
consistent and comparable format." The aim is to help with the development of more comprehensive and
comprehensible information about organizations, and can result in communication about value creation
over time.

An integrated report addresses an organization's strategy, governance, performance and prospects in the
context of its external environment, leading to the creation of value over the short, medium and long term.
While the communications that result from integrated reporting will be of benefit to a range of
stakeholders, they are principally aimed at providers of financial capital. It also promotes integrated
thinking, breaking down the silos within the business, resulting in even greater business benefits.
Following extensive global consultations over 2011 and 2012, the IIRC published the International
Integrated Reporting Framework in December 2013.

3.3.2 What are the benefits of producing a CSR report?

The following lists some of the potential benefits associated with producting a CSR report.

Internal benefits for companies and organizations that produce a sustainability report can
include:

• increased understanding of risks and opportunities;

• emphasizing the link between financial and non-financial performance;
• influencing long-term management strategy, policy, and business plans;
• streamlining processes, reducing costs and improving efficiency;
• benchmarking and assessing sustainability performance with respect to laws, norms,
codes, performance standards, and voluntary initiatives; and
• comparing performance internally, and between organizations and sectors

External benefits of sustainability reporting can include:

• mitigating - or reversing - negative environmental, social and governance impacts;

• improving reputation and brand loyalty;

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 • enabling external stakeholders to understand a company's true value, and its tangible and
intangible assets; and
• demonstrating how the organization influences, and is influenced by, expectations about
sustainable development

3.3.3 What are the key steps to produce a CSR report?

A typical reporting process is described in the eight steps found in the diagram below:

3.3.4 Verification of a CSR report

It is important to provide more detail on step 6 in the figure above, i.e., content assurance.
Verifying a company's CSR report can take place in a number of ways, including internal audits,
industry (peer) and stakeholder reviews, and professional third-party audits. Depending on the
approach taken, it may result in a statement included in a report that describes the verification
process and conclusions. A company should adapt its approach to verification based on the
objectives of the report, on corporate culture, and to support the delivery of its CSR strategy and
initiatives.

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CSR report verification options
Approach Considerations
• The verification is less vulnerable to criticisms of conflict of
Independent third-party interest and is more likely to reveal problems that might not
audit otherwise be brought to light.
• Third party verification may be expensive.
• Can typically be conducted more expeditiously than can
external review processes and at less cost.
Internal review • Not likely to have the credibility of those conducted by
external parties and are vulnerable to criticisms of conflict of
interest.
• Panel members provide advice on how to optimize the
reporting process and on the quality of the report.
• Panels can bring credibility through the experience or
Community or expert concerns that members bring to the table that might be
advisory panels lacking in an internal review or third-party verification.
• May not provide as deep a review as internal or third-party
approaches and may be biased towards the views of the
panel.
• Can provide credibility to the report through the expertise or
Testimonials or independence of stakeholders.
statements from external • Allows the company some control.
stakeholders • May be low cost.
• May lack credibility with some stakeholders.

GRI has identified six key qualities for the external assurance of reports. External
assurance should:

• be conducted by groups or individuals external to the reporting organization, who are

demonstrably competent in the subject matter and in assurance practices;
• utilize groups or individuals who are not unduly limited by their relationship with the
organization or its stakeholders so that the group is able to reach and to publish an independent
and impartial conclusion on the report;
• be implemented in a manner that is systematic, documented, evidence-based, and characterized
by defined procedures;
• assess whether the report provides a reasonable and balanced presentation of performance, taking
into consideration the veracity of report data and the overall selection of content;
• assess the extent to which the report preparer has applied the GRI Reporting Framework
(including the Reporting Principles); and
• result in an opinion or set of conclusions that is publicly available in written form, and that
includes a statement from the assurance provider on their relationship to the report preparer.

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No matter the approach chosen, the verification method should check the reported CSR
performance information for:

• Balance: covering both negative and positive aspects of a company's performance, and
allowing for a reasoned assessment of performance.
• Comparability: selecting, compiling and reporting information consistently in a way
that allows analysis of a company's performance over time, and relative to other
organizations.
• Accuracy: reporting with sufficient accuracy and detail to allow stakeholders to assess
performance.
• Timeliness: scheduling reporting with sufficient timelines to allow stakeholders to make
informed decisions.
• Reliability: information and processes used in the preparation of a report should be
gathered, recorded, compiled, analyzed, and disclosed in a way that could be subject to
examination and that establishes the quality and materiality of the information.
• Clarity: information should be understandable and accessible to stakeholders.

Guidance is available for producing a CSR report

• GRI has also developed industry-specific sector supplements and one for SMEs.
• International Integrated International Integrated Reporting Council
• The United Nations Global Compact (the Communication on Progress)

Reality Check

"There is a lot of talk about reporting but I haven't seen any proof that it adds value to a
company. Given the commitment and cost involved, I am hard-pressed to allocate resources
to reporting on our CSR activities."

There are many reasons why companies would track, measure and report their CSR
performance. Some see reporting as an effective communication and reputation management
tool, building loyalty with customers, investors and suppliers around important values and
issues. Others may choose to use it as a risk management tool. Reporting requires a deep
analysis of systems and processes at the firm level and as such, opportunities for innovation
can be identified and new products and services developed which otherwise would not have
been noticed. In any case, CSR reporting is a big step for any company to take and mapping a
realistic plan is very important. A company may want to begin with a self-assessment,
moving into reporting against well-accepted guidelines such as those of the GRI. Taking a
step wise approach can phase resources and allow a company to test the value of
sustainability reporting.

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Review reports of others for ideas

There are hundreds of organizations that report on their social and environmental performance
annually. Be open about strengths and weaknesses. Reports that talk about just the good news are
less credible and open to criticism. Full transparency means talking about areas that need
improvement.

3.4 Relationship between CSR and the Law

The main tool governments use to address a company's social, environmental and economic
impacts is the law. In Canada, there are a wide range of laws at the federal, provincial, territorial
and local levels pertaining to consumers, workers, health and safety, human rights, Aboriginal
rights, environmental protection, bribery and corruption, corporate governance and taxation.
Some of these selected themes are discussed in more detail below, as they pertain to CSR and the
law.

The Government of Canada also encourages and expects Canadian firms operating abroad to
respect all applicable laws and international standards, and to reflect Canadian values and
international commitments.

3.4.1 Corporate governance

The Canadian Securities Administrators (CSA), whose members are all the provincial securities
regulatory commissions, provides guidelines to companies on their corporate governance
structure and practices. These guidelines address legal compliance and the reporting of illegal or
unethical behaviour. In this context, social and environmental issues are integral components of
the corporate governance agenda.

The CSA Corporate Governance Guidelines provide companies with guidance on:

• board independence;
• the role of the board and management;
• board assessment;
• director selection;
• senior officer compensation;
• written codes of business conduct and ethics to promote integrity and to deter
wrongdoing; and
• board responsibility for monitoring compliance with the codes.

These Guidelines have been adopted by all provinces except British Columbia.

It is also important to note that Canadian corporate law has indicated support for the
consideration of non-shareholder stakeholders in corporate decision making, stating that

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corporate directors may resolve to balance stakeholder interests "(…) in accordance with their
fiduciary duty to act in the best interests of the corporation, viewed as a good corporate citizen
(…)," and in so doing, they may take into account non-shareholder interests such as
environmental protection and long term sustainability, along with the traditional values of profit
and the primacy of the shareholder.35

3.4.2 Reporting on corporate performance

There are a number of federal laws in place requiring companies in particular sectors to publicly
disclose certain practices and activities, for example:

• Banks and federally incorporated insurance, trust and loan companies with equity of one
billion dollars or more must annually publish a statement describing their contribution
(including the contribution of their prescribed affiliates) to the Canadian economy and
society.
• Instruments under the 1999 Canadian Environmental Protection Act require certain
Canadian companies to report on greenhouse gas emissions and on a variety of other air,
water, and land emissions and releases. The Greenhouse Gas Emissions Reporting
Program applies to the largest industrial greenhouse gas emitters in Canada. All facilities
that emit the equivalent of 50 kilotonnes or more of greenhouse gases in carbon dioxide
equivalent units per year are required to submit a report.
• The National Pollutant Release Inventory reporting requirements apply to certain
companies, usually those with approximately 10 full-time employees. Environment
Canada operates an electronic single window data reporting system to allow industry to
more easily comply with the reporting requirements.
• The federal Competition Act prohibits false or misleading business practices.

It is also important to note that due to increased scrutiny from the investment community,
companies are under increasing pressure to disclose activities and issues that may have a material
impact on the their decision making and on that of investors.

Canadian Securities Administrators and reporting

For guidance on environmental reporting in accordance with Canadian Securities
Administrators guidelines, consult the CSA Environmental Reporting Guidance (2010).

3.4.3 Bribery and corruption

Ensuring no bribery and corruption are core elements of CSR, the federal Corruption of Foreign
Public Officials Act (CFPOA) makes it a criminal offence in Canada for persons or companies to
bribe foreign public officials to obtain or retain an advantage in the course of international
business. The CFPOA implements Canada's international obligations under the Anti-Bribery
Convention of the OECD.

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Based on recommendations from business stakeholders, civil society and the OECD Working
Group on Bribery, the Minister of Foreign Affairs introduced six amendments in the Senate in
February 2013 to strengthen the CFPOA. Bill S-14, entitled the Fighting Foreign Corruption
Act, amended the CFPOA by:

• introducing nationality jurisdiction;

• increasing maximum penalties from 5 to 14 years;
• creating a new book and record keeping offence for bribery;
• giving the Royal Canadian Mounted Police (RCMP) the exclusive ability to lay charges;
• clarifying the scope of the CFPOA by eliminating the requirement that business be for-
profit; and
• providing for the removal at a later date of the facilitation payment defence that exempts
payments to officials to secure the performance of routine acts.

The amendments strengthen Canada's bribery laws to further deter and prevent Canadian
companies from bribing foreign public officials in international business transactions. The
amendments received Royal Assent on June 19, 2013.

3.4.4 Important international laws with implications for Canadian companies

The following international laws may apply to some Canadian companies with operations
located overseas. These laws demonstrate the emerging trend towards the integration of CSR into
law and signal the increasing importance of a clear CSR strategy.

In 2012, under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the United
States Securities and Exchange Commission adopted new rules which have three key disclosure
requirements affecting Canadian companies listed on US exchanges:

• Payment disclosure rules that require certain companies to disclose payments of

US$100,000 or more that they make to the US or foreign governments for the purpose of
oil, natural gas, or mineral developments.
• Mining safety incident disclosure rules that require companies to disclose significant
health and safety occurrences.
• Disclosures relating to conflict minerals originating from the Democratic Republic of
Congo or a neighbouring country.

The United Kingdom Anti-Bribery Act, passed in 2010, applies to acts of bribery, being bribed,
the bribery of foreign public officials, and the failure of a commercial organization to prevent
bribery on its behalf. It requires organizations working from the UK to have ‘adequate
procedures' in place to prevent corruption in their operations worldwide.

The European Union (EU) has developed a directive that contains measures to improve
transparency and to promote sustainable business among multinational companies (mining, oil
and gas, and forestry), which passed in April 2013. All EU members must now pass legislation,

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within a two-year timeframe, that requires extractive sector companies listed on EU stock
exchanges and those with major in-country European projects to report taxes, royalties and
bonuses paid to governments worldwide on a country-by-country and project-by-project basis.
The impact to Canadian extractive companies would be similar to the US Dodd-Frank Act.

In the United States, a number of companies have been sued under the Alien Tort Claims Act
(e.g., Doe v. Unocal), which raises the possibility that corporate liability could be established
through transnational civil litigation.

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Annex 1 - CSR Standards, Guidelines and Initiatives
Endorsed by the Government of Canada:

• Doing Business the Canadian Way: A Strategy to Advance CSR in Canada’s Extractive
Sector Abroad
The Government of Canada’s CSR strategy for Canadian extractive sector firms that
operate abroad.
• Organisation for Economic Cooperation and Development (OECD) Guidelines for
Multinational Enterprises
The Guidelines are far-reaching recommendations addressed by governments to
multinational enterprises operating in or from adhering countries. The guidelines cover
key areas of business ethics, observe internationally-recognized standards and respond to
other societal expectations.
• Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-
Affected and High-Risk Areas
Provides detailed recommendations to help companies respect human rights and avoid
contributing to conflict through their mineral purchasing decisions and practices.
• Global Reporting Initiative Guidelines
GRI's mission is to make sustainability reporting standard practices for all organizations.
Its core product is the Sustainability Reporting Framework and Guidelines.
• Voluntary Principles Security and Human Rights
This initiative was instigated by the American and British governments and is supported
by the Dutch and Norwegian governments. The principles cover providing of security by
public sector bodies and by private actors, and conducting risk assessments concerning
security and human rights.
• International Finance Corporation (IFC) Performance Standards
IFC, a member of the World Bank Group, is the largest global development institution
focused exclusively on the private sector in developing countries. The Performance
Standards provide guidance on how to identify risks and impacts, and are designed to
help avoid, mitigate, and manage risks and impacts as a way of doing business in a
sustainable way, including stakeholder engagement and disclosure obligations of the
client in relation to project-level activities.
• Equator Principles
The Equator Principles are a voluntary set of environmental and social screening criteria
and guidelines that provide a framework for banks to manage environmental and social
issues in project financing. Note that Export Development Canada has signed on to them.
• Extractive Industries Transparency Initiative (EITI)
The EITI is a coalition of governments, companies, civil society groups, investors and
international organisations. Its principle methodology, known as the EITI Standard,
works to ensure that global standard for revenue transparency at the local level is
maintained throughout the different implementing countries.
• ISO 26000
ISO 26000 is the international guidance standard for social responsibility. It supports

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 companies and organizations in translating principles into effective actions, and promotes
best practices relating to social responsibility at a global level. It targets both large and
small organizations in the public and private sectors.
• United Nations Global Compact
The UN Global Compact is a strategic policy initiative to encourage companies to adopt
sustainable and socially responsible policies, specifically in the areas of human rights,
labour, environment and anti-corruption.
• United Nations Guiding Principles on Business and Human Rights
The Government of Canada actively supported the development of the United Nations
Guiding Principles for Business and Human Rights, and encourages their adoption by
Canadian business. Endorsed by the United Nations Human Rights Council in 2011, the
Guiding Principles are a global standard for preventing and addressing adverse impacts
on human rights caused by business activity.
• International Labour Organization (ILO) Standards
The ILO standards are a comprehensive system of instruments related to work and social
policy. These standards are backed by an international supervisory system and
mechanisms that help to ensure the implementation and ratification of the standards
within the member states.
• ILO Tripartite Declaration
The ILO has given special attention to multinational enterprises by adopting the 1977
Tripartite Declaration of Principles concerning Multinational Enterprises and Social
Policy (recently revised). This is a global commitment designed to guide governments,
employers and workers in areas of employment, training, working conditions and
industrial relations.

Annex 2 – Additional Tools and resources

There are a wide range of tools and resources to assist companies in the development of CSR
programs. The list below provides references to some of the most commonly use.

Government of Canada Websites

Government of Canada websites on corporate social responsibility and sustainable development:

• Industry Canada
• Environment Canada
• Export Development Canada
• Department of Foreign Affairs and International Trade
• Natural Resources Canada:

General CSR Tools and Guides

• Industry Canada: CSR Tool Kit

provides practical guidance on why and how to integrate sustainability-oriented practices

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 into business operations, covering such topics as governance, decision-making, human
resources, purchasing and marketing.
• Canadian Institute of Chartered Accountants (2011)
Sustainability: Environmental and Social Issues Briefing: Questions for Directors to Ask
[PDF document]
• CBSR Transformational Company Framework
• The World Business Council for Sustainable Development
WBCSD Tool Box
• Ceres Roadmap for Sustainability (2010)
• International Chamber of Commerce (2012)
Green Economy Roadmap
• International Chamber of Commerce
Business Charter for Sustainable Development: How to inspire and grow your business
in the 21st century
• The United Nations Environment Programme "Efficient Entrepreneur"
• Coalition for Environmentally Responsible Economies Principles

Aboriginal Engagement

• Natural Resources Canada (NRCAN's) Aboriginal Mining Tool Kit

• Canadian Council for Aboriginal Business, Progressing Aboriginal Relations Program
sets out a framework under which companies can establish performance benchmarks to
help them develop mutually beneficial relations with Aboriginal people, companies and
communities.
• Canadian Council for Aboriginal Business, Canadian Aboriginal Business Certification
Program Certified Aboriginal Business (CAB) Program
• Canadian Business for Social Responsibility
Building Sustainable Relationships: Case Studies from the Aboriginal Engagement and
Sustainability Conference [PDF document]

Bribery, Corruption and Business Ethics

• OECD Anti-Bribery Convention

establishes legally binding standards to criminalize bribery of foreign public officials in
international business transactions. It is the only international anticorruption instrument
focused on the 'supply side' of the bribery transaction.
• Export Development Canada.
Keeping Corruption Out: EDC's Guide for Canadian Exporters [PDF document]
• Canadian Business Ethics Research Network
• Ethics Centre: Canadian Centre for Ethics & Corporate Policy
• Transparency International. Business Principles for Countering Bribery: SME Edition
• The Anti-Corruption Forum
• Institute for Business Ethics. Business Ethics of SMEs [PDF document]

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 • TRACE International, Inc.
is a non-profit membership association that pools resources to provide practical and cost-
effective anti-bribery compliance solutions for multinational companies and their
commercial intermediaries (sales agents and representatives, consultants, distributors,
suppliers, etc.).
• Business Anti-Corruption Portal. The UN Global Compact Anti-Corruption Tools
Inventory

Climate Change

• Carbon Disclosure Project (CDP)

The Carbon Disclosure Project evaluates corporations on their climate change risks,
opportunities, impacts, associated business strategies and performance. The CDP aims to
optimize its reporting process by administering questionnaires and assisting companies in
""calculating corporate GHG emissions, conducting company-specific risk and
opportunity assessments, and/or drafting language to best represent their current and
planned strategies and performance"".
• Carbon Disclosure Project (CDP) Water
CDP Water calls companies to perceive and treat water with strategic importance. With
the help of the global system collecting information about corporate behaviour on water
security and climate change, developed by the CDP, its aim is to enable better decision-
making by providing investors, companies and governments with information on how
responses to natural resource constraints are managed.
• Canadian Institute of Chartered Accountants (2009)
Climate Change Briefing – Questions for Directors to Ask Chartered Professional
Accountants of Canada
Executive Briefing Climate Change and Related Disclosures National Round Table on
the Environment and the Economy (2012)
Facing the Elements: Building Business Resilience in a Changing Climate (Business
Primer)

Collaboration

• Canadian Business for Social Responsibility (CBSR) (2014)

CBSR Collaboration Tool

Consumers

• Consumer Complaints Management:

A Guide for Canadian Business. Industry Canada Office of Consumer Affairs.

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Co-operatives

• Industry Canada, Corporations Canada, Create/Maintain a Co-operative

• Industry Canada, Co-operatives Policy
• Canadian Co-operative Association, Sustainability Toolkit
• CoopZone
• Co-operatives and Mutuals Canada (CMC)

Employee Engagement

• Network for Business Sustainability

Employee Engagement tool.

Extractives

• Building the Canadian Advantage

A Corporate Social Responsibility Strategy for the Canadian International. Extractive
Sector
• International Council on Mining & Metals
guides and tools e.g., human rights, grievance mechanisms, biodiversity, Indigenous
peoples, resource endowment.
• International Petroleum Industry Environmental Conservation Association
guides and tools e.g. grievance mechanisms, engagement, community investment,
environmental and social performance during exploration.

Governance

• Canadian Coalition for Good Governance

• Chartered Professional Accountants of Canada.
Publications on Governance

Human Rights and Business

• UN Guiding Principles on Business and Human Rights, The Ruggie Principles: Protect,
Respect, Remedy [PDF document]

Investment

• United Nations Principles for Responsible Investment (UN PRI)

is an international network of investors committed to implementing the six Principles for
Responsible Investment related to environmental, social, and corporate governance
issues, and aim to help signatories contribute to a more sustainable global financial
system.

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 • Social Investment Organization. (2010) Your Guide to Socially Responsible Mutual Fund
Companies in Canada.
• Canadian Institute of Chartered Accountants (2010)
Environmental, Social and Governance (ESG) Issues in Institutional Investor Decision-
Making

Reporting

• Global Reporting Initiative

is a non-profit organization that promotes economic, environmental and social
sustainability. GRI provides all companies and organizations with a comprehensive
sustainability reporting framework which enables all companies to measure and report
their sustainability performance.
• International Integrated Reporting Council [PDF document]
provides a framework to help organizations of all sizes and in all sectors with the process
of integrating financial and non-financial (CSR) performance reports. It takes a
principles-based approach in the application of measurements and disclosure methods.
• The Canadian Institute of Chartered Accountants
Management's Discussion & Analysis: Guidance on Preparation and Disclosure (2009)
[PDF document]
• Global Initiative for Sustainability Ratings
• Publish What You Pay

SMEs

• Industry Canada's SME Sustainability Road Map

• Network for Business Sustainability SME Primer [PDF document]
• Network for Business Sustainability
Provides advice for SMEs on how to cut costs, motivate employees, enhance reputation
and increase sales — while helping the environment, employees, and the community. It
also includes success stories.

Stakeholder Engagement

• Network for Business Sustainability. Stakeholder Engagement Tool

• International Finance Corporation (IFC)
Stakeholder Engagement: A Good Practice Guide Handbook for Companies Doing
Business in Emerging Markets
• AA1000: Stakeholder Engagement Standard
was developed by AccountAbility to establish the benchmark for good quality
engagement and a framework for designing.

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Supply Chain

• Network for Business Sustainability

• International Chamber of Commerce. (2008). Guide to Sustainable Sourcing
• ICC Legal Handbook on Global Sourcing Contracts
• UN Guide on Supply Chain Sustainability aims to help companies overcome social and
environmental risks and governance challenges posed by the supply chain. Four key steps
are outlined: commit; define and implement; access; measure and communicate.
• Voluntary 3rd party standards for ethical supply chains and sustainable sourcing:
o Fairtrade International
o Rainforest Alliance
o Utz

Annex 3 – CSR expert advisory group

Name Title Organization
Yolanda Banks Senior Advisor CSR Export Development Canada
Executive Director and Network for Business Sustainability and Ivey
Tima Bansal
Professor School of Business, Western University
Diane J.
President and CEO Retail Council of Canada
Brisebois
Susanna Cluff- Director Parliamentary
Canadian Chamber of Commerce
Clyburne Relations
Tania Del Matto Executive Director My Sustainable Canada
Steven Fish Executive Director Canadian Business for Social Responsibility
General Manager Social
Jeff Flood Nexen
Responsibility
Jean Paul Gladu President and CEO Canadian Council for Aboriginal Business
Heather Lang Director, Research Sustainalytics
Associate Professor and Institute for the Study of Corporate Social
Kernaghan Webb
Director Responsibility, Ryerson University

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Endotes
1. For the sake of brevity hereafter referred to as "the Guide"
2. Porter, M.E., & Kramer, M.R. (January 2011). Creating Shared Value. Retrieved from
Harvard Business Review
3. Trucost. (2011). Universal Ownership: Why Environmental Externalities Matter to
Institutional Investors [PDF document]. Commissioned by UN Principles for Responsible
Investment (PRI) and UNEP Finance Initiative
4. BRASS and ACCA. (nd). The ABCs of CSR for SMEs
5. Accenture & UN Global Compact. (2010), A New Era of Sustainability: UN Global
Compact-Accenture CEO Study [PDF document]
6. Forbes Magazine, (2012), The Top 10 Trends in CSR for 2012
7. Forbes Magazine, (2012), The Top 10 Trends in CSR for 2012
8. Abacus Data. (2010), Ethical Consumerism and Canadians [PDF document], Commissioned
by the Corporate and Community Social Responsibility Conference at Algonquin College
9. Abacus Data. (2010), Ethical Consumerism and Canadians [PDF document], Commissioned
by the Corporate and Community Social Responsibility Conference at Algonquin College
10. Responsible Consumption Observatory (2012) Ontario Responsible Consumption Index
11. BBMG, GlobeScan and SustainAbility. (2013), Re:Thinking Consumption: Consumers and
the Future of Sustainability
12. Vancity. (2011). Retrieved from 2011 Annual Report
13. Telus. (2011). Retrieved from CSR Report 2011
14. Canadian Tire
15. MIT Sloan Management Review and the Boston Consulting Group. (2013). The Innovation
Bottom Line: Findings from the 2012 Sustainability & Innovation Global Executive Study
and Research Report
16. International Finance Corporation's Strategic Community Investment: A Good Practice
Handbook for Companies Doing Business in Emerging Markets (2010)
17. Mountain Equipment Co-op. (2011). 2011 MEC Accountability Report
18. TD Bank. (2012). TD 2012 Corporate Responsibility Report
19. Loblaw Companies Ltd. (2011). 2011 Corporate Social Responsibility Report
20. Blackberry. (2012). 2012 Corporate Responsibility Report
21. Ford Motor Company. (2012). Sustainability 2011/12
22. MIT Sloan Management Review and the Boston Consulting Group. (2013). The Innovation
Bottom Line: Findings from the 2012 Sustainability & Innovation Global Executive Study
and Research Report
23. Business in the Community. (2009). How to manage your supply chains responsibly
24. MIT Sloan Management Review and the Boston Consulting Group. (2013). The Innovation
Bottom Line: Findings from the 2012 Sustainability & Innovation Global Executive Study
and Research Report
25. Doran, G. T. (1981). There's a S.M.A.R.T. way to write management's goals and objectives.
Management Review, Volume 70, Issue 11(AMA FORUM), pp. 35–36
26. GlobeScan. (2012). 2012 Radar Report
27. GlobeScan. (2012). 2012 Radar Report

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28. International Organisation for Standardization, ISO Standard 26000 (2010)
29. Organisation for Economic Cooperation and Development, OECD Guidelines For
Multinational Enterprises (2011)
30. International Association for Public Participation, IAP2 Spectrum of Participation (2007)
31. Aboriginal Affairs and Northern Development Canada, Aboriginal Demography –
Population, Household and Family Projections, 2001-2026 (2007)
32. The Institute of Risk Management, A Risk Management Standard (2002)
33. Global Reporting Initiative, GRI Technical Protocol Guidelines (2011)
34. Forbes Magazine, (2012) The Top 10 Trends in CSR for 2012
35. Supreme Court of Canada Decision, BCE Inc. v. 1976 Debenture holders, 2008 SCC 69,
(2008) and Supreme Court of Canada Decision, Peoples Department Stores Inc. (Trustee of)
v. Wise 2004 SCC 28, (2004)

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