More than one in five respondents say that CSR is “a must” for organizations.

Summary: Oil and gas, life sciences and public administration are feeling increased public pressure in this area. Many respondents indicate they are managing the risk by incorporating CSR into their business strategies.

Social acceptance risk/CSR was a new entrant to the risk radar last year at ninth. This year it stays in the same position, but, averaging across all respondents, it is expected to rise by 2013.

Key factors

All sectors surveyed consistently rank this risk in eighth or ninth place. The exception was public administration, which places it fifth.

This likely reflects issues such as the impact of Wikileaks, mass demonstrations against austerity programs in Europe and North America and government toppling “people power” unrest in the Middle East.

The sector-by-sector graph of the percentage reporting that public expectations have risen provides a fascinating insight into the degree to which stakeholder pressures have increased in recent years.

Sectors facing pressure

1. Oil and gas narrowly leads public administration in the percentage of respondents that indicated they are facing rising pressure.
2. Life sciences is next, facing intensifying pressure to provide life-saving medicines at lower cost, particularly in poor countries
3. Banking is third, because public interest in payment structures has soared in the wake of the financial crisis. 

As drivers of the risk, rising CSR standards are noted most frequently, followed by public pressure and activism, and then new CSR legislation (such as the conflict mining provisions of the US Dodd-Frank Act).

Our survey results show that CSR and social acceptance are perceived as relatively important risks not only in North America and Europe but also in emerging markets.

Approximately 4 executives in 10 in Australia, the Netherlands and South Africa report their organizations struggling to manage rising CSR standards, and 3 in 10 respondents in China complain of challenges managing their sector’s negative image.

Drivers of social acceptance and CSR risks, as reported by organizations surveyed

2013 forecast

Nearly all sectors see this risk rising in importance by 2013.

Social acceptance risk - CSR

Managing the risk

Our findings underline the extent to which the management of CSR risks has become an integral part of organizational cultures and strategies around the world.

Over one in five respondents said that CSR was “a must” for organizations operating in their sector, and approximately one in three had taken measures to integrate CSR into their business strategy. 

However, averaging across all the sectors, only 4%of respondents perceived a competitive advantage stemming from their CSR activities, suggesting that social acceptance is still understood primarily as a risk, rather than as a potential source of business opportunity.

Sector strategies

• Power and utilities respondents were most likely to have adopted CSR as part of corporate culture.
• Banking and public administration, two sectors facing rising public scrutiny, were least likely to have made such extensive CSR efforts.

Geographic approaches

• Over 90% of organizations in France, Germany and Russia report having taken measures to manage CSR risks actively, more than twice the levels in the US and Australia.
• In Italy, the proportion implementing measures to manage the risk is small enough that the sample size prevents accurate assessment. However, 50% of respondents based in Italy say that such measures are planned in the future.

Factors mitigating slow recovery and double-dip recession risks, as reported by organizations surveyed

Organizations' responses to social acceptance risk/CSR

Percentage reporting that public expectations have risen, by sector

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