3 July 2018

Contribution of the areas of sustainable development and corporate social responsibility

Summary: Since the 1970s, major economic development projects have sought to mitigate their negative social impacts from a sustainable development perspective. In recent decades, life cycle assessment (LCA) has made it possible to document the impact of a product or service more rigorously.

According to Freudenburg (1986), social aspects began being considered in the study of the anticipated impacts of major projects in addition to the economic and environmental components as early as the 1970s. The systematic considerations of these impacts is called the social impact assessment (SIA), as formalized by the International Association for Impact Assessment (IAIA). According to Armstrong, SIA has developed in a context of increasing concern for environmental impacts and social acceptability:

In a broad sense, accounting for social impact—“social impact assessment” (SIA)—is the activity of assessing responses of human communities to particular interventions, including negative unintended responses. The 1980s development of environmental impact assessment included a social aspect, an endeavor to estimate, in advance, social consequences likely to follow from specific policy actions. One SIA function is to anticipate effects of defined types of change in a human community in order to evaluate the “goodness” of alternative interventions. SIA provides information that is used in a risk management process—the assessment itself doesn’t judge the “goodness” of the intervention. (Armstrong, 2006, p. 10)

SIA, thus defined, is an ongoing process that does not aim to measure impacts from a purely retrospective perspective but rather attempts to identify and prevent negative impacts from a perspective of social acceptability. This is how the Impact Assessment Agency of Canada understands impact assessment, in agreement with the 2019 impact assement Law. This perspective is quite different from other types of program evaluation within the public administration and is, in that sense, more closely tied to the notions of sustainable development and corporate social responsibility (CSR).

Life cycle assessment (LCA) follows a similar path. It aims to operationalize the principles of sustainable development and mitigation of negative environmental and social impacts by increasing the rigour of the analysis and by taking the time to look at each stage of the life cycle of a product or service. It first focused on the environmental impacts in the early 1990s, building on ideas such as the notion of energy balance. Later, LCAs drew inspiration from stakeholder theory in management sciences, leading to social LCAs to emerge in the 2000s.

Corporate social responsibility (CSR) is a broad movement related to sustainable development. In practical terms, this movement emphasizes the consideration of extra-financial characteristics in the management and analysis of the activities of a company or organization. The Global Reporting Initiative (GRI) is part of this movement. Although sometimes associated with social impact measurement, it is more accurately described as a monitoring and reporting system focused mostly on processes and outputs rather than outcomes or impacts per se. The IRIS bank of indicators and B Corp Certification, while sharing some methodological elements with the GRI, arose from a different current, impact investing, to be discussed later in this timeline.