Corporate Social Responsibility Analysis: NAB and Rio Tinto Report

This report provides an executive summary and in-depth analysis of the corporate social responsibility (CSR) practices of two major companies: National Australian Bank (NAB) and Rio Tinto. The introduction highlights the increasing importance of CSR in the modern business environment, emphasizing ethical conduct and social responsibility. The report identifies and discusses the core business activities of both companies, detailing their operations, market positions, and product ranges. It then delves into the range of issues addressed in their social reports, comparing the depth of coverage on specific issues, such as financial assistance for NAB and safety and environmental concerns for Rio Tinto. The report examines the extent of differences in their CSR approaches, reflecting on their differing industry contexts and stakeholder focus. The quality of their social accounting approaches is assessed using Zadek’s criteria, and their alignment with stated values is evaluated. The report concludes with a reflection on the ideas presented, summarizing the challenges and strategies of both companies in managing their CSR initiatives.

BUSINESS AND SOCIETY

EXECUTIVE SUMMARY
In the modern Era of business it is essential that companies do not just have to take
care of the profit margins but they also have to look up to the corporate social
responsibilities. Business ethics and values have taken deeper roots in the industry and every
company needs to comply with it. Any kind of negligence towards these affairs leads to long
term loss to the company in terms of their brand image as well as sometimes financial also.
Every company have their own business ethics and values which every stakeholder needs to
comply with. To understand the corporate affairs company also take use of social accounting
approaches.
Contents

EXECUTIVE SUMMARY...................................................................................................................2
INTRODUCTION.................................................................................................................................3
Identifying and discussing core business activities............................................................................4
Range of issues dealt within their social reports and depth of coverage on specific issues................5
Extent of these differences.................................................................................................................6
Apparent quality of social accounting approaches.............................................................................7
Reflection of their stated values.........................................................................................................8
Reflection on the ideas presented......................................................................................................8
CONCLUSION.....................................................................................................................................9
REFERENCES....................................................................................................................................10
INTRODUCTION
In the modern business environment it has become essential for the firm to take care
of the responsibility they have towards the society in which it is operating (Carroll, 2015).

There are many business ethics and moral behaviour that is being defined by the company so
that every employee can work under these set of rules. There are several kinds of approaches
that are being used by the firm to evaluate their corporate performance. National Australian
Bank and Rio Tinto are two companies that have been selected for understanding the
corporate social responsibility and approaches used by various firms. This report highlights
the ways in which these companies are facing various challenges while maintaining their
corporate social responsibility. It also underlines the quality of the approaches that both the
cited company is utilising for their CSR.
Identifying and discussing core business activities
National Australian bank (NAB) is one of the four biggest financial institutions within
Australiain measures of earning, consumers and capitalism. It is headquartered in Dockland,
Melbourne, Australia. In terms of market capitalism it has been ranked as the 21st largest
bank in the world. In regards to the total asset measured in 2016 it was ranked as the 49
largestbank. This company is operating with approx. 1590 branches as well as service centres
(Sustainability report, 2018). On the other hand it has around 4,412 ATM’s all across New
Zealand, Australia and some parts of Asia. NAB has around 12.7 million consumers all
across the globe. In the Australian banking industry it is having larger share. It is a type of
Public type of company. This company’s major operation is in the Banking and Financial
services. It has got AA rating by Standards & Poor’s. Its product range includes Business
banking, Consumer banking, Wholesale banking, Wealth management and Insurance.
Company generates revenue of around 20.176 billion and has employee strength of around
35000.
Other company that has been taken for understanding corporate social responsibility
is Rio Tinto. It is an Australian-British multinational firm and comes under the category of
public sector firms. It was founded way back in the year 1873 and presently it is one of the
biggest firms in the industry of metal and mining. This company has a long history of Merger
and expansion which helped it in its growth. This company is world leader in production of
many kinds of metals like Aluminium, copper, uranium, diamonds, iron ore and coals
(Sustainable development report. 2018). This company basically deals in the business of
extraction of metals but apart from this it also has business of refining of metals. The
expanded reach of the company is in all 6 continents with major operations in Canada and
Australia and has owns many of the mines. It is having its head office in both London and
Melbourne.

Range of issues dealt within their social reports and depth of coverage on specific
issues
Both firms operates in very different kinds of industry and hence different kinds of
operations are performed within the firm. The areas of operations are totally different. Due to
this challenges that are faced by the company in their areas of operations are different
(Cheng, Ioannou & Serafeim, 2014). Both these companies have different kinds of social
issues that are tackled by them in their CSR activities.
National Australia Bank has a social responsibility that revolves around taking the
society more financially stable. Major part of their sustainability reports 2017 discusses
towards providing financial assistance to society and weaker sections in it. Their theme of
CSR revolves around providing financial hardship assistance. NAB has provided more than
513,000 plus Australians are supported with micro finance services and products using the
partnership of Good Shepherd Microfinance. More than 14000 employees were directly
involved in the CSR activities (Sustainability report. 2018). NAB has financed $13.4 billion
in financing to assist in addressing climate change and support the transition to low carbon
economy. This CSR Governance has a team that biannually reflect on CR performance,
social, environmental and governance risk etc. They help people in accessing affordable and
fair financial services. They have a specific goal of assisting people in building financial
resilience. They also get involved in building stronger bonds with people so that they can
support them in financial shocks, indigenous success, family violence. They also have
contributed heavily on the climate change risk causes. Not only this they have also adopted
sustainable approach to minimise environmental impact by adopting sustainable business
(Crane, Matten & Spence, 2013). They take the help of NGO’s in their decision making
process so as to evaluate its decisions in terms of corporate responsibility. The biggest
challenges that come in front of its CSR activities are rising economic instabilities in many
parts of the world and increasing unemployment in the society. Their tone of report is society
oriented where they focus on supporting individuals in their financial constraints.
On the other hand Rio Tinto has a much diversified CSR as there areas of operations
are larger. They are operating in many areas where society is weaker. Their Sustainability
report of 2016 indicates their commitment towards safeguarding environment as well as
providing an environment for their stakeholders where they can easily afford their basic
amenities (Sustainable development report. 2018). They are highly focused towards taking

safety measures for their employees as well as other stakeholders (Gurská & Válová, 2013).
They consider safety of their stakeholders as their first priority. Their report also indicates
that company is determined to safeguard the resources available at their areas of operations.
In this process they review their geo technical practices and water scarcity problems. They
also gives care towards critical risk management programme. It also indicates towards their
efforts for reducing greenhouse emission. They face a severe challenge from the issue that
many of their mines are going to end in the coming years. The tone of this report is more
stakeholders oriented and speaks more n the voice of their management.
Extent of these differences
There are many kinds of challenges that are faced by the company in terms of CSR
that is evident in the above section of this report (Hopkins, 2012). Since the area of
deliverables is different for both the companies hence it is very clear that their differences are
also wide ranged. NAB basically focuses towards providing assistance to their stakeholders
in terms of finance they are managing. On the other hand Rio Tinto focuses more on the
safety of their stakeholders. Since the performance of the world economy is not stable hence
NAB has to focus more on uplifting societies. Both the reports somehow relates to the
decisions that was made by their management in recent years towards managing their
operations.
NAB has a report that is customer oriented while Rio Tinto produces a report that is
society and stakeholder oriented. NAB has the commitment towards stabilising the economy
of Australia so that more number of people can enjoy economic freedom on the other hand
Rio Tinto’s sustainability report underlines their natural restraints and global crisis of
resources that the company is going to face in the coming years.
While comparing in terms of industries in which they are operating it can be seen that
NAB is facing the problem of economic instability that is a crucial problem for the firm and
hence have to ensure that considerable amount of money is given in CSR management
(Sustainability report, 2018). On the other hand since the mining industry is facing the
problem like environmental issues, limitation of resources and development of the area in
which they are mining (Hopkins, 2016).

Apparent quality of social accounting approaches
While comparing the quality of social accounting approaches one of the most used
approach is Zadek’s criteria. Quality has been accessed below according to the given criteria:
Criteria NAB Rio Tinto
Inclusivity This company has included all
the sections of the society in
their report. They also includes
other NGO in their decision
making process related to CSR
activities.
There inclusivity is slightly on the
lesser side as the company includes
only members from the management
as well as other related stakeholders
only (Sustainable development report.
2018).
Comparability This company provides details
regarding the social affairs that
it is involved in as well as the
amount it is spending on its
various CSR activities
(Sustainability report. 2018).
This company provides more result
oriented data for example the amount
of success it has gathered in its
approaches to CSR.
Completeness It is lesser complete than that
of the Rio Tinto firm as it lags
the results that it achieved by
its CSR activities
It is more accurate as deductions are
possible to make after reading the
sustainability report of the company.
Evolution They are working hard to
check all the dimensions of
CSR responsibility.
They have evolved their CSR
activities by taking the feedbacks
from their stakeholders.
Management
policies and
system
There management policies are
good and have incorporated a
system where they check their
CSR activities biannually.
This company keeps on making
changes in their CSR activities. Their
system is such that they check their
policies according to the CSR
activities within the industry and
Country.
Disclosure They disclose all the
information clearly.
They also have elaborated their
information in a defined manner.
External
Verification
They do their external
verification from time to time.
They also verify their social
responsibility on timely basis.

Continuous
improvement
They constantly improve their
quality in CSR by taking
feedbacks.
Continuous improvements have been
done by them so as to make better
CSR strategy.
Reflection of their stated values
Both these companies have evolved their procedures of CSR over the years. This has
made the process more result oriented. Since these companies have faced many kinds of
penalties in the past and hence need to take care of the CSR operation. They have mentioned
a wide range of values. Both these firms follows Global Reporting Initiative framework and
hence have designed their CR activities in the same way as according to these guidelines.
This made the data to be easily interpreted in their reports so that anybody can understand it
clearly. Their prime focus was on the relevant data.
Both these companies have used a very different set of tools to reflect their data. Since
there is no hard and fast rule for including anything in their report hence both these
companies have produced the report as per tier convenience (Khan, Muttakin & Siddiqui,
2013). Both the cited companies have clearly elaborated challenges that are faced by them as
well as the gaps they are facing in their report and their stated goals.
Both organisations have used their perspective while designing their CSR report and
somehow revolving around the business ethics they have made for themselves. It can be
understood in the terms that NAB is more focused towards providing assistance to their
society while Rio Tinto especially focuses towards safety which is major concern in the
industry.
Reflection on the ideas presented
While reflecting on the ideas presented, it can be said that both the reports have
statements from the senior decision makers. It is evident from the report that they are destined
to make higher economic success in the coming years. This also confirm that there approach
is to enhance the commercial success with the responsibilities they have in the society. It can
also be seen that both cited companies have made their report highlighting the key challenges
that is faced by the company within the industry and they differ from each other in many
ways. Management approach towards the CR management is also discussed in the above
section. They have made systems where they see to the compliances registered by their

stakeholders. Since the operations of both the firms are affecting lives of many people hence
companies have made their CR accordingly.
CONCLUSION
From the above report it can be concluded that every company needs to manage their
social responsibility in a better way so that they do not have to face any kind of grievances.
These companies choose the approach to their CSR according to the requirement of the firm
and the industry. NAB supports the society and stakeholders in terms of their facing financial
restraints. On the other hand there are many kinds of approaches to CSR and Zadek’s Criteria
is effective in evaluating their report quality. Both these firms haveproduced their report
according to their business ethics and stated values which can be clearly seen in their report.
REFERENCES
Carroll, A. B. (2015). Corporate social responsibility. Organizational dynamics, 44(2), 87-96.

Cheng, B., Ioannou, I., &Serafeim, G. (2014).Corporate social responsibility and access to
finance. Strategic Management Journal, 35(1), 1-23.
Crane, A., Matten, D., & Spence, L. J. (2013). Corporate social responsibility in a global
context.
Gurská, S., &Válová, A. (2013).Corporate social responsibility in mining
industry. ActaUniversitatisAgriculturaeetSilviculturaeMendelianaeBrunensis,
61(7), 2163-2170.
Hopkins, M. (2012). Corporate social responsibility and international development: is
business the solution?.Earthscan.
Hopkins, M. (2016). The planetary bargain: corporate social responsibility comes of age.
Springer.
Khan, A., Muttakin, M. B., &Siddiqui, J. (2013). Corporate governance and corporate social
responsibility disclosures: Evidence from an emerging economy. Journal of
business ethics, 114(2), 207-223.
Sustainability report. 2018. [Online]. Available at:
https://www.nab.com.au/content/dam/nabrwd/About-Us/shareholder-centre/
documents/sustainability-report-2017.pdf.[Accessed on: 6th January 2018].
Sustainable development report. 2018. [Online]. Available at:
http://www.riotinto.com/documents/RT_SD2016.pdf. [Accessed on: 6th
January 2018].