Owner’s Expectations Manual for Crown Research Institutes

5. SOCIAL RESPONSIBILITY

The CRI Act requires every CRI to exhibit a sense of social responsibility by having regard to the interests of the community in which it operates and by endeavouring to accommodate or encourage these when able to do so.  Therefore, CRIs have corporate social responsibility (CSR) obligations that go beyond those of other companies.

There are a number of leading international frameworks available to provide guidance on how CRIs could approach CSR.  These frameworks emphasise that CSR is not just about visible programmes, but is also more importantly about values and behaviours evident in an organisation’s day-to-day operations.  Accordingly, prescriptive approaches to CSR are unlikely to be successful, and it is recognised that one size does not fit all.

However, it is important to note that, in addition to having CSR programmes in place, CRIs have a fundamental obligation to behave in a socially responsible manner at all times.  This obligation should, therefore, be reflected in all policies and be evidenced by company practices.  To this end, shareholding Ministers are particularly sensitive to any breaches of a CRI’s obligation to act in a socially responsible manner.

CRI boards must report any such breaches to shareholding Ministers as soon as practicable after any breaches are brought to the boards’ attention.  Likewise, breaches should also be disclosed in the companies’ annual reports. Robust procedures and accountabilities should also be put in place to ensure details of any breaches are communicated to boards in a timely way.

The most effective and appropriate way to address the CSR obligations of CRIs is to integrate CSR into the existing business planning process, with officials providing guidance and monitoring input to help with the consistency and quality of CSR plans. 

Such an approach puts CSR objectives on the same footing as financial objectives.  Targets and objectives are set in the annual SCIs, and subsequently reported against to help ensure transparency and accountability for good CSR practices.

Under the CSR framework, the onus is on each CRI to look hard at the way it conducts its business, and put in place appropriate values and objectives and monitor performance against them.  Complementary to this, each CRI should assess its impact on the society and environment within which it operates, and adopt specific CSR programmes that are appropriate to that CRI’s impact on the environment and its interfaces with society in general. 

Shareholding Ministers expect each CRI to have the following in place from the commencement of the 2008/09 financial year:

• specification of CSR values and behaviours, and how these are incorporated into the fabric of the company,
• objectives and performance targets reflecting good social responsibility practice,
• specific CSR programmes, and
• the reporting framework to be used.

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