Moray Macdonald: Greenwash will not win friends when it comes to hard times

THE oil leak in the Gulf of Mexico may have been capped, but it hasn't put a stop to the crisis facing the future of BP.

As the oil giant takes sweeping steps to draw a line under the worst environmental accident in US history, the events have forced companies around the globe to consider their own green credentials. There is no longer any escape from our collective environmental challenge — no sector or company, large or small, is immune.

In recent years corporate social responsibility (CSR) had lost its appeal, perhaps because too many organisations viewed it as a PR ploy to gain brownie points rather than a business ethos. Seeing how quickly the reputation of one of the world's most powerful companies can be irrevocably tarnished now has businesses taking a hard look at their wider responsibilities and what they are doing to build links with the communities in which they work.

For years BP promoted itself as one of the most socially responsible companies around, but this held little sway with the people who mattered. When trouble hit the Gulf of Mexico, BP's historical failure to build a strong pool of community and political support was exposed and the backlash was unrelenting.

Less about gimmicks and stunts and more about building lasting links with local communities, CSR is something that needs to be put firmly at the centre of business strategy. Taking responsibilities a little further than recycling paper and turning down the thermostat can pay dividends during a crisis.

The term corporate social responsibility isn't just about putting sustainability at the core of your business, it's about playing a central role in your social landscape. Companies will no longer get away with paying lip service to their duties to the wider world outside the four walls of their business. It is not just a box to tick or something to be "seen" to do: CSR is a business practice that can save a company's reputation at the end of the day.

Global research has found that 80 per cent of business executives believe that companies with strong corporate responsibility records recover faster after a crisis than those who don't.

CSR is about being aware of the effect a company has environmentally, socially and politically, and integrating that into the overall business strategy from the start. Taking precautions to minimise the damage to the environment can allay this problem, but social responsibility is more of a nurturing process.

Social media is going to be pivotal for reputation and business survival in the coming years. There is no scope for "greenwash" in a world fuelled by 24-hour media and a social media phenomenon that can make the most unheard-of businesses famous for all the wrong reasons in about two hours flat. Never overclaim, but start communicating your sustainability credentials to gain market advantage.

Failing to take CSR seriously can have a massive impact on a business' bottom line. Disgruntled residents are just the start of a spiral that leads to furious shareholders, a nervous stock market and ultimately a plunging share price. It can even have a knock on effect to the reputation of the industry as a whole when things go really wrong.

When CSR is formed as part of the core business plan it can have a positive implication for the long term success of the organisation. If companies take their responsibilities seriously in the good times, their reputation among key stakeholders will help them recover from the bad times.

Moray Macdonald is deputy managing director at public relations and public affairs consultancy Weber Shandwick.