Corporate Social Responsibility (CSR) has seen a groundswell in recent years, leading to its insurgence as an integrated component of business strategy and operations. At the 2014 Association of Corporate Counsel (ACC) Annual Meeting, a panel of experts discussed CSR’s evolution, various trends, and how businesses are choosing to incorporate it going beyond just compliance, yet limiting exposure of legal, operational, and reputational risks.

The panel discussion began by noting that the growing attention gained by CSR has generally been under the broad topic of sustainability. Through this, CSR awareness and focus has increased due to: heightened media awareness; consumer and shareholder awareness; direct-to-consumer products; emerging business risk; regulatory evolution; and global governance standards.

Requests for deeper feedback and analysis of CSR by shareholders have been a leading trend for organizations over the last several years. As awareness grows, companies must address what information they disclose to be material, whether the content will provided via printed reports or posted online, and how often that information is updated or made available. Additional trends highlighted were the significance and prominence of voluntary governance standards, environmental factors such as climate change, and the demands of Environmental, Social and Governance (ESG) reporting.

The panelists did note that CSR is not well-defined, implying that it is different amongst industries, and even companies within the same industry have varying views. Through CSR reporting, many results are difficult to measure or may not even be quantifiable, creating difficulty to show a cause-and-effect. In addition, a company should evaluate how much information they distribute to their stakeholders to limit reporting fatigue, as much of the CSR information may be used in multiple reports or may not be seen as relevant to certain audiences.

Currently, many CSR standards are not legally binding, but if a company does not follow common established standards, those choices could lead to increased risk through litigation, labor issues, project delays or other issues. With a lack of standards generally accepted, Sustainability Accounting Standards Boards (SASB) and the United Nations Guiding Principles on Business and Human Rights were mentioned briefly as potential resources that could encourage acceptable standards for CSR.

Another point of discussion focused on the view of CSR from the board. Board members may have questions as to why the company is investing in monitoring and reporting CSR if there is not a defined benefit the company receives. The group emphasized the importance of investing in monitoring, and reporting helps meet the demands and expectations of key stakeholders. Plus, much of the information used in CSR reporting is already being done within the company, but more as a functional aspect and not necessarily reported out in the CSR format.

The panelists noted they have seen an increase in general language that they believe has been developed to limit risk and exposure. They asked whether a company opens itself up for further risk by disclosing information, especially in forward-looking statements. If targets or standards are noted in reports, could those be used as evidence if an issue were to arise?

Legal departments and in-house counsel can serve important roles in CSR, providing a fresh and different perspective when reviewing the information and any reports before they are finalized. The legal team likely has a better understanding of what is material, whether an example provides the best representation for the company, and they have a holistic view, all to help manage risk.