SHRM Foundation Executive Briefing
Produced in partnership with the World Federation of People Management Associations (WFPMA) and the North American Human Resource Management Association (NAHRMA) Overview
Organizations are increasingly concerned with sustainability and corporate social responsibility. The HR function is uniquely positioned to assist in both developing and implementing sustainability strategy.
suggests that corporate virtue in the form of social and environmental responsibility is likely to pay off financially.
What is sustainability? Why do firms pursue it?
Sustainability has been defined as the ability “to meet the needs of the present without compromising the ability of future generations to meet their needs.” As regulatory pressures and societal demands for greater environmental and social responsibility have increased, sustainability has become a key focus for many organizations. A sustainable organization can be defined as an enterprise that simultaneously contributes economic, social and environmental benefits—known as the “triple bottom line”— to society while also ensuring its own long-term sustainability as an organization. Sustainability is seen by many as increasingly essential to creating shareholder value, as investors and employees look to organizations to be good corporate citizens. There is an emerging business case that corporate performance, under the right conditions, can be enhanced in firms focused on sustainability. For example, a 2003 meta-analysis of research studies
PwC: Building Sustainability Mindset and Skills in Leaders At PricewaterhouseCoopers, a novel initiative called the Ulysses Program sends teams of high-potential leaders to developing countries for eight weeks. They contribute their professional knowledge pro bono to address a social or environmental issue and, in the process, develop deep learning of the meaning of sustainability and the role of business in influencing economic, social and environmental well-being of communities and markets.
What is HR’s role in developing strategy and advancing sustainability? In organizations adopting a sustainability strategy— whether for business, legal or values-based reasons— HR has an important role to play. The HR function should help formulate and achieve environmental and social goals while also balancing these objectives with traditional financial performance metrics. The HR function can serve as a partner in determining what is needed or what is possible in formulating corporate values and sustainability strategy. At the same time, HR should play a key role in ensuring that employees implement the strategy consistently across the organization. Sustainable human resource management (HRM) can be defined as using the tools of HR to create a workforce that has the trust, values, skills and motivation to achieve a profitable triple bottom line.
Examples of sustainable HRM practices include:
Encouraging employees, through training and compensation, to find ways to reduce the use of environmentally damaging chemicals in their products. Assisting employees in identifying ways to recycle products that can be used for playgrounds for children who don’t have access to healthy places to play. Designing a company’s HRM system to reflect equity, development and well-being, thus contributing to the long-term health and sustainability of both internal (employees) and external communities. Emphasizing long-term employment security to avoid disruption for employees, their families and communities. Corporate Responsibility for Employee Well-Being In recent years, two companies have made headlines due to their particularly high rates of employee suicides—France Telecom (24 suicides in 2008/2009) and Foxconn China (9 suicides in 2010). In both cases,...