Corporate Social Responsibility is a hard-edged business decision—not because it is a nice thing to do or because people are forcing you to do it, but because it is good for our business. – Niall Fitzgerald.
If you are a business owner, you likely have heard all about corporate social responsibility (CSR for brevity). By now, it should no longer be a buzzword to you but rather something your company should be actively working on.
Today, modern businesses do not thrive on profit alone. In fact, the days of operating solely for profit are long gone. Of course, making a profit is still of paramount importance, but it should not be the only reason you are operating and running a business. If a company truly wants to flourish in this time and age, they need to give corporate social responsibility equal importance. Modern consumers are no longer interested in simply buying a company’s product. As they are no more demanding and discerning than ever, your consumers would want to know what you value. More importantly, they want you to become more transparent and know whether you have actively addressed environmental, cultural, and social issues.
Indeed, CSR has taken its place and cemented it in today’s corporate world. Businesses that overlook or neglect it should do so at their own peril.
In a nutshell, CSR means that a company takes conscious steps to ensure positive environmental and social effects are associated with how they operate and do business. In some cases, this may mean doing CSR activities in the Philippines or simply taking a more active role in ensuring that their business positively impacts their surroundings. Companies that engage in active CSR efforts would take measures to ensure they can observe the way they operate in the world in such a way that they can incorporate addressing cultural and social issues.
More importantly, they do this in a way that benefits society as a whole and them. CSR models are known to boost business and increase revenue. Also, it can affect progress by promoting a more positive change in your surroundings. As a result, CSR often helps people with little to no resources.
Keep in mind, however, that CSR is viewed differently from philanthropy. When appropriately and properly implemented, CSR should be ingrained in the values and culture of a company. It is not forced, nor should it feel like an artifice. If executed well, it should flow naturally and positively affect how a company operates and does its business.
That said, CSR should be inherent in a company’s mission and message and also hold a strong place in advertising and marketing. However, businesses should know that they should promote their CSR models in conjunction with their execution of the plan. In this way, they can positively benefit from it. Doing so otherwise and falsely claiming to bring social change without concrete plans can potentially damage your company’s image.
Companies that overlook corporate social responsibility may find themselves at their brand’s bottom line. More importantly, this gives their competitors an edge over them. Today, brand reputation is everything and having a bad one socially and environmentally creates serious negative effects on your company’s profitability and success.
Nowadays, it is imperative to understand that consumers want to spend their hard-earned money on products and services that they themselves believe in. As a result, they only wish to engage with businesses and companies that follow a set of ethical practices that align with their own.
The millennial and Gen Z population are greatly outnumbering older generations by the day. As this happens, it is pivotal for companies to consider their corporate social responsibility status. A model of corporate social responsibility is essential if a business wishes to attract one of the largest markets and demographic.
It is also worth noting that millennials and younger generations are particularly tech-savvy, so they are probably the first to research a company and look into its labor practices and ethical records. In a sense, they are holding you accountable for your business practices, and if your company fails to meet their standards, you are likely penalized by not winning their business.
While CSR is not exactly a legal mandate for companies, they would largely benefit from it. This is because many of today’s consumers feel like it is their unspoken duty to have a role in making the world a better place. As a result, this socially and environmentally conscious generation would not want to support or be associated with a company that does not take its share of its responsibility in helping the world.
Another worth noting is that employee engagement is tied to a company’s CSR reputation. Surveys have shown that millennials tend to acknowledge a company’s commitment to corporate social responsibility, which often influences their choice to work and continue working there.
As millennials are soon to be the biggest generational segment of the workforce, it makes sense for companies to embrace CSR in order to entice and retain talent. Remember, millennials do not just wish to consume products and services made by companies that have a CSR presence; they want to form part of these changes as well.
While a commendable act, simply donating money to chosen charities does not cut it as a CSR activity. The essence of corporate responsibility is ensuring that every single person in your organization is accountable and actively works to earn the trust of their consumers and investors. That said, it is imperative to meet ethical and responsible behavior expectations adequately.
So, where does a company start? Below are a few tips your business can follow to ensure that your company operates as a responsible corporate citizen.
Each company should have its own business code of ethics. This will codify and delineate employee conduct on social, environmental, and cultural issues. On top of that, it should also outline their ethics, diversity, values, employee respect, and customer service. In fact, you can take this a step further by changing your company’s governance to include your commitment to environmental and social goals.
Create and develop policies that benefit the environment. More importantly, incorporate practices that help you fulfill your environmental commitment. An excellent example of this is producing reports that document all of your activities and results related to environmental impact. Your company may even opt to produce broader sustainability reports which contain everything from environmental, economic, and social activities.
Having a workplace health and safety program in place is imperative, as this will enable you to establish reliable systems to protect your employees. On top of that, this is an indispensable tool that will help you mitigate the occurrence of workplace accidents and injuries. More importantly, it will also ensure that your company is compliant with the government’s mandate and legislation on health and safety.
Be fair and honest in using marketing techniques. Choose only those that reflect your company’s integrity, and do not advertise to sound environmentally conscious and concerned to your consumers. Also, it is best to avoid any sort of advertising or communication that may be misinterpreted or seen as manipulative and harmful to the public. Be mindful enough to walk the talk whenever you wish to promote something. See to it that your company does what it says it does. Failure to do so can lead to negative publicity and customer backlash.
Corporate social responsibility may largely be a business initiative, but it also extends to those your company transacts with. That said, ensure that your suppliers are aware and would meet your expectations of responsible behavior. This means that your values should align in terms of fair pricing and other environmental issues. With that in mind, always screen your suppliers before transacting with them. In this way, you can determine their past conduct and tell them what your company expects.
Do not arbitrarily donate money for the sake of charity. Instead, choose causes that are meaningful to your business. After all, the core idea of CSR is to give back to society while simultaneously sending a message about your brand’s values.
As said above, corporate social responsibility is more than just a business than just a marketing trend, and neither is it a passing business fad. If your business wishes to stay afloat and relevant to new generations, you would benefit by embracing CSR.
In this way, you can increase your efficiency and revenue while making a positive impact on the world.