For Middle East Business News and Magazine
New CSR Reporting Standard in the Middle East
Implementing and reporting on Corporate Social Responsibility (CSR) adds value on so many levels; it gives an organization insight on how to improve strategy and performance, helps stakeholders better understand the organization’s actions, and assures that the organization operates in a sustainable way.
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“The GCC region has exceptional potential to be a global leader in corporate and social responsibility and an inspiration to other nations to achieve sustainable economic growth while creating stable, inclusive societies in a thriving environment. The Islamic Reporting Initiative (IRI) aspires to become the first mainstream CSR reporting standard that is aligned with Islamic principles and values. We believe the IRIhas the potential to create a legacy of corporate and institutional sustainability”, Drs Daan Elffers, CEO of EMG and Chairman of the IRI Advisory Council.
EMG has been engaged in projects in the Middle East for more than a decade and discussions with local experts and practitioners have led the advisory firm to identify a need for an internationally recognised reporting standard that incorporates the nuances of Islamic business practice that contribute to responsible performance. The outcome? – The IRI Reporting Standard; a CSR and sustainability reporting framework for use by organizations operating according to Islamic values.
CSR in the Middle East
There is widespread recognition of the extraordinary potential of the region to achieve triple bottom line success; people, planet and profit. Abu Dhabi’s Masdar city and Jeddah’s Muroojcity demonstrate the Middle East’s innate ability to push all limits, and it is this energy that posits the region as one to keep an eye on when considering issues of sustainable development. This, is, in part, driven by the principles and values of Islam. One value especially pertinent is that of philanthropy; a deeply embedded practice that individuals and businesses partake in to help alleviate societal and environmental challenges. A second value corresponds to Islamic Finance, which is consistent with the principles of Sharia, and provides a road map for responsible investment. As such, the culture of generosity and responsibility is already well established and serves as a springboard for corporate social responsibility in that, quite simply, the former is charged with the responsible spending of profits and the latter the responsible generation of profits.
The message that the IRI conveys is one of recognition of the intrinsic relationship between philanthropy, responsible investment and CSR. The IRI recognises that they share similar goals of sustainable social and environmental development. Aligning them strategically ensures that the developments generated through philanthropy, such as improved access to, and quality of, education, are fed back into the organization through the provision of a well-educated pool of talent. Therefore it makes perfect organizational and societal sense to understand CSR as a long-term investment. And as Peter Bakker, President of the World Business Council for Sustainable Development (WBCSD), says, “Business cannot succeed in a society that fails”.
Reporting on CSR activity is an effective method of evaluating and communicating progress. Opting for a CSR reporting framework that identifies and embraces local elements of a business environment maximises opportunity.
The IRI reporting standard
The IRI is a non-profit organization headquartered in the UAE, and has been created to promote and facilitate triple bottom line reporting as a mechanism for business development and growth in a context that is aligned with Islamic principles. It is anticipated to be adopted by governments, corporations, and non-profit organizations operating in or from over 50 member states of the OIC.
The IRI standardwill provide comprehensive metrics and methods for effectively measuring and reporting on all relevant aspects of the triple bottom line, with a particular focus on short- and long-term investments in the following areas;
- Islamic social responsibility code of conduct
- Health provision and promotion
- Social investment
- Youth engagement
- Empowerment of the local workforce
- Development of STEM skills and knowledge transfer
The IRI, in cooperation with its members, is actively seeking qualified partners in the MENA region and beyond to help lead or support the further development of this initiative.
Elffers: “We are calling for governmental organizations to come on board to help incentivize the Initiative through the provision of leadership and guidance; corporations to provide practical input and to serve as pilots, and non-profit organisations, academic institutions and individuals to provide expertise and support to ensure that the standard created is reflective of current and future demand”.
“We have already had significant expressions of support and partnership from governmental bodies, corporations, non-profits and universities from across the GCC, confirming the extensive capacity this initiative can have. The foundation is there, the potential is there, and the timing couldn’t be better”.
“The Islamic Reporting Initiative (IRI) aspires to become the first mainstream CSR reporting standard that is aligned with Islamic principles and values.”
Drs DaanElffers, Chairman of the IRI Advisory Council
“The expertise we can bring as a University is the energy of a generation that seeks positive change. We are well placed to recognise the challenges of the younger generation and therefore able to contribute to the solutions. Subsequently we encourage other leading universities to join us in the collaboration with the IRI, as together, we can make a positive and lasting change”.
Dr Abdul-Aziz Sharabati, Head of Management, Marketing and E-Business Department at the Middle East University, Jordan.