The importance of corporate social responsibility to society
Is Corporate Social Responsibility good for society?
We live in a world where social responsibility is a critical factor in where employees choose to work and where consumers decide to spend their money. Understanding the impact they have on the world around them has never been more important for large corporates. But more than that, in order to stand out in a positive light, they need to implement and commit to a program of social responsibility activities.
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The nature of CSR has evolved, it is now more than simply giving to charity; it has become an integral part of how organizations run their business and focus on consumers’ perceptions of company governance, the company’s positive influence on society and the way in which it treats its employees.
Each year Boston-based Reputation Institute releases its list of the world’s most responsible companies. The findings are based on 170,000 ratings from interviews with the public in 15 of the world’s largest economies. In 2017, Danish firm Lego was named the world’s most responsible company. The public believes the company behaves ethically, conducts business fairly, operates transparently, protects the environment and supports worthy causes. In particular, the company was highlighted for its top-down approach to CSR activities: a key factor in ensuring that CSR is taken seriously throughout an organization. Microsoft and Google rounded off the top three.
It’s clear why corporate social responsibility is important to organizations: it enhances public trust; it makes an organization a more attractive prospect for employees, particularly Millennials; it leads to more engaged employees, and let’s not forget that engaging in CSR and becoming a responsible business can have a positive impact on an organization’s bottom line.
But does Corporate Social Responsibility have a positive impact on society itself?
According to a research paper by Ross School of Business, it depends on the ownership type, specifically, whether a company is publicly or privately owned. Publicly listed companies have a responsibility to shareholders, which can lead to discontinuing CSR activities if the activities are at odds with shareholder expectations. That being said, it’s difficult to ignore so much of the positive work many multinational firms do for societies around the world.
An interesting blog post on Smart Recruiters highlights 20 of the top corporate social responsibility initiatives in 2017. The post outlines the Ben & Jerry’s Foundation, which awards over $1.8 million each year to fund community action and societal change; the fact that Bosch devotes 50% of its research budget to developing technologies focused on supporting conservation and environmental protection; Starbucks’ plan to hire 10,000 refugees across 75 countries in the next five years; and Levi Strauss’ Water<Less program, which significantly reduces water use in manufacturing, by up to 96 percent for some of its styles.
These are just a few examples of the positive impact these large corporations are having every day on society, whether it’s by donating to needy causes, supporting environmental changes or developing programs to help people from developing countries.
But CSR isn’t just something practiced by large corporates and isn’t always something that’s publicized. Many firms work on their own corporate social responsibility plans by improving the lives of their employees through healthy initiatives or organizing fundraising events to benefit local charities. Though smaller in scale, these CSR programs are no less impactful and can have a hugely positive effect on staff and local communities.
It’s clear that a truly effective CSR strategy cannot be just a ‘tick the box’ activity. It’s a case of walking the walk and not just talking the talk. Senior management buy-in is essential and that enthusiasm will filter down and have a wider impact on the general workforce.
A simple way to ensure any CSR activities are promoted and adopted by as many employees as possible is to include details of any programs, fundraising plans, wellbeing initiatives via the company newsletter. Keep employees up to date on outcomes from any CSR activities with videos or snappy articles and make sure to send these updates out regularly.