Numero 46 Registrazione al tribunale di Roma N° 3/2004 del 14/01/2004

Defining a new CSR-based Balanced Scorecard Model


di Massimo Carosella


Business international scenario shows that, more than ever, corporate behaviour is and will grow up being the main topic in the consumer assessment and evaluation of a Company.

And that is true not only with regard to just one perspective, though financial, or even social or environmental.

Now, either due to the increasing reference law and regulation corpus, or due to a new cultural, environmental, social sensibility, though keeping in mind the Corporate strategy, a variety of issues, rules and, in one word, knowledge dramatically wider than before has to be faced.

Any specific focus which possibly shifts attention from the whole towards one or two perspectives, risks not to consider the changing scenario of the economy and, mainly, of the entire World itself. Decades ago, Corporate Governance already fostered the migration from specific and separated focuses to an integrated one, embedding in it ethical, environmental and social motions, formerly almost irrelevant to the primary aims of a Company.

As a consequence, Managers need to integrate with each other not only intrinsically related policies but also absolutely unstructured and differentiated information, often not available in a digital form.

For example, it does not slip anyone’s mind how skills necessary to deliver a reliable and effective consulting service in the Corporate Governance area, formerly limited to the economic-technical ones, now cannot do without social, environmental, ethical contributions.

The first problem arising from such a situation is that nowadays, more than ever before, a sharp cut between a traditional methodological approach and a technology based one risks to leave dramatically important issues and topics unexplored and unmanaged.

The second problem is that such a plurality of issues, topics, data can’t be faced just with theoretical tools, dramatically different from each other, referring to fundamental concepts spreading out between very distant subjects like human sciences and technology.

Therefore they need to be implemented in a completely new Business Model supported by a deeply reshaped Executive Information System, better if spread out, with regard to data sources and deployment, into the deepest segments of the Organization.
In my recent experience, these subjects can become essential in pursuing the Company’s strategy when faced keeping in mind the integration between CSR principles and a Balanced Scorecard cockpit.

The aim of such an integration is:

  • from the top management point of view, to widen its analysis and planning scope, from single specific organization segments/processes up to the Company-wide strategies;
  • from the information asset’s point of view, to take advantage of putting together data not always coming from homogeneous digital supports;
  • from the organization’s point of view, to implement a Model in which any organization segment, from the lowest to the highest, has a clear objective to pursue, coherent with all others;
  • from the marketing point of view, to show to the customers evidence of how much issues such as environment care, social sensibility, ethical approach are actually pursued by the Company.

The Balanced Scorecard (BSC) is a business practice aimed at monitoring corporate strategy accomplishment through operating processes performance indicators.

Since it monitors Company’s strategy with regard to its mission and vision, it can provide a solid and familiar foundation in which to integrate CSR principles.

A modern and correct approach to a thorough BSC Model is to integrate and balance any social, economic and environmental issues in the traditional four perspectives of growth and learning, internal processes, customer relationship, and finance.

Our BSC Model, redefined and tuned by C.C.S., succeeds in keeping the issues of Ethics, Society and Environment on the top front of attention for everyone in the organization.

Compared to similar approaches, which instead add new perspectives to the four traditional ones, our Model reshapes these last, conveying and incorporating in them CSR related objectives and measures.

The first difference with regard to the traditional model of BSC is the articulation of each of the four perspectives in five additional objective categories such as Ethics, Environment, Society, Operations, Governance.

This articulation assures that any of the four usual perspectives be investigated according to topics which keep into account all the CSR principles.

In the first table we show a sample of how CSR categories (Ethics in the example) can incorporate, or be reshaped with regard to, the BSC perspectives.

BSC Perspective CSR Obj. Category CSR Objective
External Ethics Correct quality/price relationship of the product/service
External Ethics Marketing policies ensuring advertising truthfulness
External Ethics Regular (ITT) Invitation To Tenders and (ITB) Invitation To Bids management
External Ethics Truthfulness and honesty in applying for authorizations, permits, licences, etc.
External Ethics Truthfulness, timeliness and honesty in managing fines and sanctions
Financial Ethics Capital reward sharing
Financial Ethics Ethical investments in the long term
Financial Ethics Adequate wage policy
Financial Ethics Fair and prompt payment guarantees for suppliers and employees
Internal Processes Ethics Informative transparency
Internal Processes Ethics Security and hygiene
Internal Processes Ethics Controls ability of preventing from creating extra accounting funds
Internal Processes Ethics Regular Balance Sheet preparation
Learning and Growth Ethics Transparency and thoroughness of Internal Processesernal communication
Learning and Growth Ethics Thoroughly extended perception of ethical values
Learning and Growth Ethics Definition of a Code of Ethics and a Disciplinary System
Learning and Growth Ethics Communication and diffusion of the Code of Ethics and the Disciplinary System


In the following one, BSC-based, we show how a sample of the External perspective can be rearranged to incorporate CSR instances.

BSC Perspective CSR Obj. Category CSR Objective
External Environment Ethical purchasing policy, giving priority to suppliers with sound environmental practices
External Ethics Correct quality/price relationship of the product/service
External Ethics Marketing policies ensuring advertising truthfulness
External Ethics Refrain from using goods or services  produced with child or prison labor
External Ethics Transparency and thoroughness of external communication
External Ethics Truthfulness and honesty in applying for authorizations, permits, licences, etc.
External Ethics Truthfulness, timeliness and honesty in managing fines and sanctions
External Governance Correct Board of Auditors and Auditing Firms relationships
External Governance Competitive Positioning
External Governance Correct relationships with Public Institutions and Security Agencies
External Governance Supply and service compliance to rules and regulations
External Operations Timely response to customers compliants
External Operations Effective contract management
External Operations Correctness and regularity in Purchase Orders to suppliers
External Society Contributions to local development
External Society Cooperation in community projects
External Society Policies prioritizing local suppliers and employees
External Society Partnership and cooperation with communities for pursuing mutual goals


As the tables suggest, the Model takes advantage of its implementation into a multidimensional database which allows the CSR objectives and the BSC measures to be investigated from either point of view drilling down the analysis of one towards another.

One of the main differences from the traditional model of BSC is the provision of the sustainable environment and ethical issues in the Internal Processes and in the Learning and Growth perspectives.

This assures a firm foundation of the ethical and environmental sensibility of the whole organization and the spontaneous sharing of the reference values among all people involved in the business and in maintaining a sustainable development approach.

Another difference is the inclusion of all relevant stakeholders (society, more than just customers) and of their motions not only in the external, but in all the perspectives.

This, in fact, ensures that policies and measures developed based on mission and vision goals, and focus on growth and learning initiatives, internal and external development, correct financial management and sustainable development are linked and focused to the social dimension of the Model.

With regard to the financial perspective, which could perhaps be thought as the most distant from the very CSR principles, the financial rewards that instead accrue to the Company, the profit dimension, will undoubtedly derive from, and be boosted by, policies and procedures aligned with CSR initiatives and with the overall vision of the organization.

In an overall vision of the above outlined approach, any individual working in the Company, or for any reason involved with its business and management, will surely acknowledge, and adapt him/herself to, the strategic importance of sustainable behaviour as essential to the survival and success of the Company.



Massimo Carosella, electronic engineer and Management consultant, from 1998 engages in technology-based Management Consulting: the technology used evolved from original Dss’s to the most up-to-date simulation and analysis management intelligence tools. Is CEO of C.C.S.- Carosella Corporate Solutions LLC (, based in the Dallas area, Texas – USA and with offices in Italy. In This Company, he implemented and tuned an innovative approach to Corporate Governance, with valuable focus on Corporate Social responsibility themes, supported by in-house developed software applications, integrated as to the approach and innovative as to their uniqueness on the specific market.