18 September, 2020

Whilst expectations from investors, employees and consumers for responsible business practices have never been higher[1], nor the business case been stronger[2], the terminology remains an issue. Organisations will often refer to their strategy as either ESG (Environmental, Social & Governance), Sustainability, CSR (Corporate Social Responsibility) or Corporate Citizenship, so what is the difference and what does this mean at CBRE?

Different phrases. Same objective.

Quite simply, there remains no universally accepted terminology or definition for corporate responsibility[3], and numerous studies suggest this is actually a good thing[4]. Different organisations have different ideas, interests and issues. There is no ‘one size fits all’ so the terms must be able to be used in different ways.

The way we loosely think of these things at CBRE is that CSR or sustainability tends to refer to the voluntary policies, plans and initiatives an organisation puts in place to improve the impact it has on workers, environment and community. ESG is essentially the same thing but is primarily an investor term. A way for investors to compare all these slightly different strategies and more quickly understand which organisations are doing what. There is even a growing number of companies (think of them as credit-rating agencies for business ethics) that help them do just this.

In terms of how the phrasing has evolved[5], corporate responsibility was originally focused on an organisation’s philanthropy or charity work. Over time, however, organisations evolved to capture the environmental and social impacts of their direct and indirect actions i.e. the impact their product or service has when being sourced, made, used and disposed of. As the finance and investor community has increasingly embraced these issues, they have demanded greater consistency and accountability around impact and targets and ESG has become the term of choice for many.

Regardless of terminology however, they all essentially refer to business ethics i.e. voluntarily taking greater responsibility for the impacts an organisation has on society and the environment than they are required to by law[6].

What does it mean at CBRE?

At CBRE Ltd we use ESG to refer to our own strategy, primarily because of our closer links with the investor community. However, we do use the phrases somewhat interchangeably i.e. our ESG strategy is managed by our Sustainability team in our Environmental Consultancy Group - simple right? But semantics aside, what it really means to us is: recognising the impact our sector has on the climate emergency and role we (and our clients) can play in addressing this; creating quality and meaningful jobs for our people; and doing our part to enable a fairer society. To pay it forward.

It’s also about learning and transparency. Acknowledging that our actions might not always match our ambitions and being able to admit and correct this as we go forward. Ultimately, it’s our sustainable behaviours (not the terminology) that matter to our people, our investors and our clients. And it’s what we promise to focus on.



[1] Hoffman, A (2018) The Next Phase of Business, Stanford Social Innovation Review, 16(2): 34-39., Ross School of Business Paper No. 1381, Available at SSRN: https://ssrn.com/abstract=3191035 or http://dx.doi.org/10.2139/ssrn.3191035

[2] Huang, K., Sim, N., and Zhao, H. (2020). Corporate social responsibility, corporate financial performance and the confounding effects of economic fluctuations: A meta-analysis. International Review of Financial Analysis, 70

[3] Watts, S (2015) Corporate Social Responsibility Reporting Platforms: enabling transparency for accountability. Information Technology and Management, 16(1), 19-35

[4] Van Marrewijk, M (2003) Concepts and definitions of CSR and corporate sustainability: between agency and communion. Journal of Business Ethics, 44(2), 95-105

[5] Visser, W (2011) The Age of Responsibility: CSR 2.0 and the New DNA of Business.

[6] Bauman, C.W. & Skitka, L.J. (2012) Corporate social responsibility as a source of employee satisfaction. Research in Organisational Behavior, 32, 63-86