A New Methodology Approach for Measuring Corporate Social Responsibility Performance

The exact contribution of corporate social responsibility (CSR) to a company as well as to its stakeholders should be measurable in order to be evaluated correctly. The difficult task of measuring the results of CSR has been a matter of significant research both by academics and by practitioners. Some of the literature on corporate social responsibility combines CSR with stakeholder theory introducing corporate social performance. The literature has attempted to describe emerging models of the issues that lead to a coherent model of what would represent corporate social performance. However, it is the case that social aspects are “soft” in nature, therefore being difficult to quantify. Innovated methods of performance measurement such as that of Balanced Scorecard has lately been introduced in some companies in their attempt to include non-financial indicators to give a more balanced and forecasting power to the traditional financial performance assessment system, but the view of corporate social responsibility is rarely taken into account. Furthermore, management frameworks that try to cover social and environmental aspects, such as Global Reporting Initiative, by providing a number of related performance measures, are not able to connect them with corporate strategy and are poor evaluators of cause-effect relationships. In the present paper, a CSR performance measurement framework based on the adoption of the Balanced Scorecard approach is presented. For the development of the proposed framework, the existing assessment of CSR and Corporate Sustainability actions of the Greek companies of different sectors was analysed in order to identify common practices in CSR performance evaluation as well as existing limitations. Taking into account the social indicators suggested by the traditional balanced scorecard views, an extension of its structure is proposed in order to better embody the environmental and social aspects of company performance.