The first thing to realise about the new ISO 26000 standard is that it offers voluntary guidance for social responsibility and sustainable development. It is not, therefore, certifiable – i.e. unlike other management standards, most notably ISO 9000, there are no requirements to be audited and resulting certificates issued to prove conformity.
So if it is not intended to be binding, legally or through independent auditing, what is the purpose of the standard?
ISO 26000 is an attempt to bring all the thinking, guidance and local standards together, using input from a wide range of stakeholder groups from government to labour and business to consumers. It covers seven “core subjects”:
- Organisational governance
- Human rights
- Labour practices
- The environment
- Fair operating practices
- Consumer issues
- Community involvement and development
ISO represents these as a circle around the organisation, to give all subjects equal importance. It is aimed at all sizes of organisation, whether public or private and in developed as well as developing countries. As such, it is an attempt to be all things to all people and therein lies the problem with certification.
Among the guidance offered on integrating social responsibility, ISO includes some of the processes that we built into our Golden Rules of best corporate governance practice . Apart from spending a lot of time on helping people understand social responsibility and how to integrate it throughout the organisation, it also offers guidance on identifying stakeholders, communication and reviewing progress and improving performance in social responsibility.
Will ISO 26000 be effective in improving Social Responsibility?
Identifying, analysing and communicating with stakeholders, as well as monitoring progress and performance is key to our own approach to corporate governance and Corporate Social Responsibility, developed over the last 20 years and published by the Financial Times group in our book Real-World Corporate Governance (FT Pitman, 1998). This must, however, be viewed in the context of a practical and simple, but comprehensive plan. Furthermore, in our view, this is only achievable with independent, primary research – real, two-way communication with stakeholders, rather than Public Relations exercises and box ticking.
As with all standards, ISO 26000 is a starting point. Critics of management standards and certification will tell you that most organisations simply jump through the auditing hoops to get their certificates to hang on the office wall. That may be true, but in doing so, they are almost inadvertently improving key aspects of organisational effectiveness, even if much of the quality system is not used on a daily basis. And without the development of such standards, we believe the quality of management would be much worse. Indeed you have only to look at what was common practice just 30 years ago, in the early days of management standards, to realise that social responsibility has come a long way, thanks mainly to these standards.
So, arguably, without such a necessarily generic, uncertifiable standard such as ISO 26000, with its effect on behaviour (which will be driven primarily – as ever – by competitive advantage), Social Responsibility would continue to swirl around in the ponderous dregs of the corporate governance glass, waiting for the next round of organisational failures, environmental disasters, or worse, sledgehammer regulation.