Responsibility: The new business imperative

Abstract

Executive Overview Businesses today are experiencing profound pressures to reform and improve stakeholder-related practices and their impacts on stakeholders and the natural environment--in short, to manage responsibly as well as profitably. Pressures for expanding the emphasis on profits to managing responsibly derive from three general sources: primary stakeholders such as owners, employees, customers, and suppliers; secondary stakeholders such as non-governmental organizations (NGOs), activists, communities, and governments; and general societal trends and institutional forces. The latter include a proliferation of 'best of' rankings, the steady emergence and development of global principles and standards that are raising public expectations about corporate responsibility, and new reporting initiatives emphasizing the so-called triple bottom lines of economic, social, and environmental performance. To respond to these pressures, many multinational corporations (MNCs) in particular are developing what we have called total responsibility management (TRM) systems approaches for managing their responsibilities to stakeholders and the natural environment. In this article we outline the dominant pressures pushing the evolution of total responsibility management and present a managerial framework that highlights the three main components of TRM approaches--inspiration (vision), integration, and improvement/innovation--with the indicators inherent to a responsibility measurement approach.