Peter Wilkinson Associates

Are you really serious about corporate responsibility?

All those engaged in sponsorship need to understand what corporate responsibility means and the implications for their organisations

Are you really serious about corporate responsibility?

All those engaged in sponsorship need to understand what corporate responsibility means and the implications for their organisations 1 First define what you understand by corporate responsibility

The financial crisis has made corporate responsibility (CR) a household term but does the sponsorship industry understand CR

The European Sponsorship Association defines corporate responsibility as the responsibility and accountability of an organisation for the impact of its decisions and activities on society and the environment.

and apply it to industry practices? I suspect there is a long way to go. Recognising the importance of CR, The European Sponsorship Association (ESA) recently formed a CR Working Group to develop ESAs policy and to encourage CR practice in ESA and the sponsorship industry. For many involved with sponsorship, CR represents grass-roots activities or the greening of major events and stadia, not an expression of a strategic CR policy and approach. This paper suggests that there is a compelling business case for systematic application of CR by all engaged in sponsorship. To consider CR, we need first to clarify terms CR and CSR are often regarded as interchangeable whilst sustainability and corporate citizenship are viewed as related terms. ESA uses CR as the term covers the whole of an organisations activities, economic as well as social, and all types of organisation whether sponsor, rights holder or service provider. ESA defines CR as the responsibility and accountability of an organisation for the impact of its decisions and activities on society and the environment. This means that the organisation accepts its responsibility to society beyond its obligation to shareholders, owners or members and beyond legal compliance. The organisation

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operates transparently, ethically and sustainably and contributes to the sustainable development and well being of societies and people. For CR to be effective in the long term with regard to social, ethical and environmental risks and opportunities, CR needs to be considered and embedded in the organisations values and activities. What use is corporate responsibility to sponsorship? There are differing stances on the role CR. One view, held by ESA, is that there is a strong business case for CR as it enhances the potential for the organisation to sustain its operations by taking a broader long-tem view rather than seeking immediate results which might be detrimental over an extended period. Short-term thinking was a core factor leading the current financial crisis. Conversely, some see CR as window dressing and hold that organisations should

Applying corporate responsibility to sponsorship pre-supposes there is an overarching corporate responsibility policy with implementation systems

stick to core aims and not engage in bolt-on activities distracting from achieving results. Applying CR to sponsorship pre-supposes there is an overarching CR policy with implementation systems. Assuming these are in place, the challenge for an organisation is to make certain that their policy and values are carried through to sponsorship operations. Is value obtained in sponsorship from application of CR? Some of the extended benefits of embedding CR and applying CR to sponsorship are listed below. They are inter-connected as, for instance, a good reputation can assist in incident management and can further effectiveness of sponsorship partnerships. Risk management A reputation for responsibility enables more effective management of risks and issues. With a values framework and due diligence systems in place, an organisation can assess potential partners, identify issues, mitigate risks and prepare for incidents. Sponsors of the Beijing Olympics confronted with human rights issues and without a CR framework were forced to react at short notice, Sponsored events and facilities often rely on extensive and remote supply chains. Do sponsors and rights holders carry out due diligence and continuing checks to ensure their values are respected

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and to avoid risks of incidents such as use of child labour in producing sports clothing or the sustainable sourcing of materials and supplies? Responsible sponsorship Companies with positive CR reputations will be better placed when managing sponsorships that involve sensitive issues such as alcohol sponsorships with exposure to young people. Companies can understand the issues, avoid undue activities and more effectively draw upon their reputations for responsibility to allay public concerns. The Innovation Edge CR can provide opportunities for creativity and innovation by enabling analysis of trends and issues and engagement with stakeholders. It can open doors, build relationships and motivate all those involved with the sponsorship. Enhancing sponsorship implementation Sponsors and rights holders will have greater confidence in each other if there is a demonstrated CR commitment by the other party. Individuals, whether participants, sports people, administrators or organisers, will view the sponsorship more favourably if they believe the sponsor is committed to acting responsibly and to making a success at all levels of the sponsorship including the development of activities that benefit society. Benefiting society Many sponsorships include community and grass-roots elements and some sponsorships are entirely community focused. If such sponsorships are made within a CR framework, this can provide clarity in selection and promotion of such sponsorships, help to develop a deeper understanding of how the sponsorship can most effectively benefit society and create recognition that the long-term improvements in the community will provide an environment in which business can flourish. The result is that sponsorships are more likely to succeed because they will less likely to be ad-hoc, opportunistic, unrelated.

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Application of sponsorship methodology can benefit society. The discipline and methods of sponsorship can be translated into project management of community programmes or promotion of sustainability. Increasingly, community programmes are becoming more focused on flagship projects concentrated in areas such as education or the environment. The project management, promotion and other skills associated with sponsorship can be brought to such flagship projects. 2 What should you do? involved in sponsorship should understand their

Those

organisations CR policy and how this is implemented across the organisation, analyse the business case for applying CR to sponsorship and then be serious about its implementation. Although the financial crisis is placing pressure on all forms of

The wide-reaching results of corporate responsibility can mean sustainable sponsorships, benefits for society and all those touched by the sponsorship and, ultimately, sustainable businesses and rights holders.

budget, the fundamental role of CR cannot be neglected as it contributes to the sustainability of the company and underpins all activities including sponsorship. Thus, I suggest there is a strong case for applying CR to sponsorship assuming that the organisation has established an overall CR policy. Companies more than ever need to be seen to be responsible and to understand the sustainability benefits. The wide-reaching results of CR can mean sustainable

sponsorships, benefits for society and all those touched by the sponsorship and, ultimately, sustainable businesses and rights holders.

Peter Wilkinson Peter Wilkinson was a Director of the European Sponsorship Association at the time of writing. p.wilkinson@pwa-cr.com

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