Corporate Social Responsibility

Cisco Systems, Inc. is an American multinational technology conglomerate headquartered in Silicon Valley, California and its major business is to develop, manufacture and sell networking hardware, telecommunications equipment and other high-technology services and products such as networking switch, routers and servers (Cisco System Inc, 2012). The company has acquired many companies as subsidiaries such as OpenDNS, WebEX, Viptela, CloudLock, BroadSoft, Jabber and Jasper etc.

The company was founded in December 1984 by Leonard Bosack and Sandy Lerner who were computer scientists of Stanford University. Cisco went public in 1990 with market capitalization of USD 224 million and it’s capital raised upto USD 42.82 billion in 2018. It has over 74 thousand employees and earned total revenue USD 49.3 billion in 2018 (Cisco System Inc, 2018).

Cisco is accelerating global problem solving efforts to tackling the toughest social and environmental issues with the slogan “make the impossible possible”. Business functions set CSR goals, implement plans, and measure performance (Cisco System Inc, 2018). So, the company has well-structured corporate governance team for flourishing CSR.

The company has initiated its programs based on three pillars: People, Society and Planet.

People

This pillar focused on motivate employee (people) to maximum utilization of their knowledge and skills for success of the organization. Some important initiatives under this pillar are as follows:

1. The multilingual Code of Business Conduct (COBC) for employees has reinforced the core values and defines the company’s expectations of ethical behavior.
2. Recruiting multi-talent people from the world with qualifications of emerging areas such as artificial intelligence, machine learning and cloud engineering. The recruiting strategy is based on employee diversification and highly focused on inclusiveness based on gender and geography.
3. Every day employees working with commitment of “deal”: company provides resources and support for success and employees take bold risks, innovate and collaborate with others. The company has 6 guiding principles for dealing.
4. Listening to employees: IT platform tool “Team Space” for highlighting employee’s unique qualities and skills, “Engagement Pulse” (8 questions) and Real Deal Survey (16 questions) tool for acquiring insights from the employees are in use for better listening to employees.
5. Job related academic and professional courses, reward for outstanding works and health and fitness facilities and events are offered regularly.
6. Employee’s volunteering and donation for community such as building homes, help in natural disasters, train cisco technology to underrepresented populations (especially young women), Time2Give program (5 days off per year to community volunteer) are very significant.

Society

This is the second pillar of company’s CSR initiative. The company has invested a lot of positive impact on society. Some of the important initiatives are as follows:

• Building skills and entrepreneurship

1. Establishment of Cisco Networking Academy, one of the largest and longest running education and employment CSR programs around the world, offering different courses about networking, security and emerging technologies such as IoT (Internet of Things); network simulation software and programming environments. It also provides opportunity to access to physical and virtual lab equipment of Cisco to fresh young talented people.
2. The Cisco Global Problem Solver Challenge programs for recent graduates to solve social and environmental problems through emerging technologies.

• Strategic social investments

1. Conducting socioeconomic research and provide research findings at the World Economic Forum (WEF), International Society for Technology in Education conferences, Cisco Networking Academy partner conferences, Cisco Live and other platforms.
2. Research study in collaboration with Oxford Economics and examined how technologies such as automation, IoT, and artificial intelligence will affect the US labor market.
3. Investment on Critical Human Needs and Disaster Relief portfolio to focus on increasing access to affordable housing, food security, and clean drinking water. The company has also worked to improve the speed, efficiency, and effectiveness of humanitarian aid, and provide emergency support various natural disasters using emerging technologies.
4. Economic empowerment programs have connected underserved people and small businesses to high skills, meaningful employment and developed ability to contribute towards the digital economy.

• Human rights

1. Cisco partnered with a global nonprofit organization called BSR (Business for Social Responsibility) to impact on human rights as diverse as nondiscrimination, privacy, freedom of expression, child rights and success to public services.
2. Cisco has maintained its human right policy since 2012 based on international human rights frameworks including

• The Universal Declaration of Human Rights (UDHR)
• The 8 International Labor Organization (ILO) core standards
• The UN Global Compact
• Responsible sourcing and manufacturing

1. The suppliers should comply with Cisco’s supplier code of conduct to supply materials to Cisco. This code of conduct helps to avoid young workers and child labor, prevents pollution and hazardous materials and empower women.
2. Cisco has following the Responsible Minerals Initiative (RMI) to drive cross-industry engagement and solutions on the ethical sourcing of raw materials. The company has exhibiting a leading commitment towards environmental sustainability and supplier diversity and inclusiveness by announcing two awards for its suppliers “Excellence in Sustainability Supplier Award” and “Excellence in Supplier Diversity Award”.
3. Supplier Day Diversity Award recognizes suppliers annually who share and reflect Cisco’s commitment to inclusion and diversity by delivering high customer satisfaction.

Planet

The third pillar of is the Planet to impact. There are several CSR initiatives conducted by the company for better life and the world. Some of those important initiatives are as follows:

• Environmental Sustainability

1. At the end of the 2018, Cisco had avoided 910,582 metric ton of carbon emissions.
2. Conducting “Earth Aware” awareness campaign and “SustainX” event to sensitize about environmental sustainability. Other events such as “Product teardown events” to increase reusability or recyclability of used Cisco equipment and “Cisco Green” enables employees to learn about Cisco’s environmental sustainability activities.
3. “Cisco GreenHouse” is a web platform for employees to lead more sustainable lives.
4. Maintaining ISO 14001 certification for sites and Life Cycle Assessments (LCAs) for products in order to maintain environmental impact.

• Energy and GHG Emissions

1. Cisco is improving its products to make it maximum power efficient.
2. Reduce total Cisco product’s GHG emissions by 60 % by 2022 with baseline year 2007.
3. Generate electricity from renewable sources for building, labs and data centers at least 85% by 2022. Use solar power and purchase only renewable electricity for company use. Focused on using electric vehicles.
4. Cisco’s 20 facilities designs including data centers are incorporated into LEED[footnoteRef:1] (Leadership in Energy and Environmental Design) certification. [1: LEED is the most widely used green building rating system in the world.]
5. Cisco’s various virtual systems have heavily reduced GHG emissions by reducing international travels.

• Material use

1. Target to decrease use of virgin plastics by 20% by 2025.
2. Using more refurbished plastic components
3. Increasing recycled plastic in products and packaging
4. Reducing unnecessary plastic components and packaging
5. Restricting health and environment hazardous materials from suppliers for network equipment.

• Waste management, biodiversity and land use

1. The company does not release chemicals and oils significantly that may impact environment negatively.
2. Several water conservation projects have been implemented in different locations. Such projects helped to reuse water for irrigation, cooling towers, harvesting system etc.
3. Cisco has good initiatives on solid waste reduction. It uses 3R methods for management: Reuse, Reduce and Recycle.

Strength of CSR Initiatives Programs

Cisco has followed SDGs, international practices of social and environmental sustainability as well as corporate governance to be a responsible organization. The company has a goal to impact positively impact 1 billion people by 2025. The company has recognized as Barron’s most sustainable US company and the world’s third excellent supply chain deploying company as listed in Gartner supply chain list. The strengths of CSR initiative programs of Cisco are as follows:

• Various activities for employee integrity and motivation:

1. Strong and multilingual COBC for ethical behavior of the employees.
2. Very dynamic team of employees: multi-academic background, multi-cultural, geographically diverse and gender inclusive
3. Several IT tools and surveys to listen to employees and capture the insights and ideas from employees.
4. Several facilities such as health and wellness programs

• High initiatives towards society responsibility:

1. Establishment of Cisco Networking Academy to train young and talented people from the world about networking and emerging technologies.
2. Investment on various socio-economic researches collaborate with several institutions such as WEF and Oxford Economics.
3. Investment on humanitarian and livelihood aid, empower underserved people and strong commitment on human rights, child rights and related international rules.

• Responsibility towards environmental sustainability:

1. Working to reduce energy and GHG emission drastically with formulating four concentrated areas such as operations, supply chain, products and solutions.
2. Investing on and using clean energy such as solar energy, wind energy and promoting to use electric vehicles.
3. Target to decrease use of virgin plastics by 20% by 2025. Using 3R (reuse, reduce and recycle) to minimize waste materials and to lessen the pollution (air, water and land).

• Cisco has been ranked in good position in various indexes related to environment, social responsibility, corporate governance and sustainability.

Weakness of CSR Initiatives Programs

The company is in the booming stage of corporate social responsibility. So, it is very hard to find out the weakness of its CSR initiative programs. However, the company has lagged in some parts as given below:

1. There are many capable youths in developing countries who are unemployed due to lack of opportunities. Cisco can train those youths and create opportunities of self-employment or make capable to work in international level. This will also help Cisco to expand its network in every corner of the world.
2. There are several issues of small/big cyber-attacks by hackers globally. Cisco should take initiative to create awareness about computer and network security and collaborate with international and national agencies and government for better cyber world.
3. Cisco should move ahead for 100% renewable energy, maximum reusability of water, no GHG emission and zero waste.
4. Cisco’s social donation and welfare program should focus to poor and helpless people of very remote places. Similarly, the company’s environmental sustainability projects should collaborate with UN and other leaders of environmental sustainability by deploying emerging technologies. Such initiatives will be very admirable globally and also help to achieve some targets of SDGs.

Recommendation

Cisco Systems, Inc. is working heavily in sustainability sector such as social, environmental, economic sustainability and corporate governance. The company’s initiatives are highly appreciated in the world and the company is in higher rank of CSR. The company is contributed in cash and in-kind contributions of USD 383 million only in year 2018.

However, the company should increase its investment for the people, society, environment and the planet for better living. Investing on these factors are not pouring money in vain but it also generating opportunities for Cisco itself.

The company should also fine tune it’s aid for world’s most depriving people and place to mainstream them in the global ICT trend for better life and better world. Last but not least, Cisco should achieve 100% renewable energy, neutral water usage and zero waste materials by itself and should be a model in the field of CSR and CSV (Creating Shared Value) among other companies.

References

1. Cisco System Inc. (2012). Form 10-K 2012 annual report. Retrieved from http://pdf.secdatabase.com/419/0001193125-12-388590.pdf
2. Cisco Systems Inc. (2018). 2018 Annual Report. Retrieved from https://www.cisco.com/c/dam/en_us/about/annual-report/2018-annual-report-full.pdf