Corporate, social responsibility (CSR) has become a bit of a buzzword, yet there is more to CSR than just playing lip service. An effective CSR policy can increase company profitability and overall value. CSR policies need to be part of an overall business strategy that measures performance and sets targets. Measurable CSR actions can elevate shareholders and consumer trust and produce positive, long-term, financial outcomes. CSR is not just about doing the ‘tight thing’ and operating sustainably, CSR is now an essential key to business success. Social responsibility is more than just meeting legal requirements and a company can comply with the law without implementing CSR policies.
Yet a lack of action to demonstrate social and environmental responsibility can have serious detriment, impacting both profitability, growth and long term success.
What is CSR?
CSR is a way to demonstrate accountability for the impact a company has on the environment and community. When correctly implemented CSR has numerous benefits for companies as well as society as a whole. The media, shareholders and consumers are all aware of the importance of CSR and numerous extremely successful companies have embraced CSR and are reaping the benefits. CSR demonstrates a company cares about wider social issues and the environment and is not solely focused on issues that only impact profit margins. Another important aspect of CSR is recognition that our planet’s resources are not infinite and without effective CSR policies, growth is limited for all sectors. Therefore, operating sustainably is beneficial for business as well as the environment.
CSR policies enhance a companies competitive advantage and often influence the decisions of investors and stakeholders. Various studies show companies integrating CSR initiatives yield excellent financial returns. In addition, CSR policies can reduce expenses on business essentials such as consumables and energy costs and improve employee engagement and retention rates. To date, CSR has only been a concern to larger corporations. However, as the consumer becomes more aware of how companies impact the environment and community, CSR is now becoming a focus for small and medium enterprises (SME’s). Steve Rochlin, co-author of Project ROI, proposed CSR policies need to, fit, commit, manage and connect. By integrating CSR into all company decisions, SME’s build a brand with a positive reputation.
Showing that a company cares about social responsibility is not enough. CSR policies must also be measurable and demonstrate a real commitment to at least one area of CSR. The two most common areas companies focus on, tend to be environmental and social. When implementing environmental policies, a review of operational costs, such as energy consumption and waste disposal, should be incorporated. Policies need to both improve sustainability and reduce costs and should therefore include rational cost management and will need to be reviewed periodically.
Business benefits of CSR
Social responsibility policy has the advantage of increasing brand recognition and reputation, as well as quickly generating positive press. This provides multiple benefits including, customer loyalty, increased sales and reduced marketing requirements. Additionally, research has shown that employees are more productive and have higher job satisfaction levels and increases retention rates. With talent, especially in the tech centre, being in high demand, the next generation is looking for companies with a clear CSR strategy. This means providing statistics and the use of measurement tools, that show real results from implementing social responsibility policies.
Benefits of CSR include:
- Reduced operational costs
- Improved employee retention rates
- Competitive advantage to attract top talent
- Share holder trust
- Increased investment and access to capital
- Increased brand recognition
- Positive reputation
- Enhanced customer loyalty
- Increased potential growth
- Higher profits
Corporate social responsibility (CSR) is also essential for SME’s to attract socially-minded investors, enabling organisational growth. Following extremely successful CSR business strategy, implemented by companies including Rolex, Lego and Sony, SME’s are now capitalising on the potential of CSR.
CSR and Women in Tech
In September 2020 the CIO report showed only 10% of women are in leadership positions within the tech sector, which includes digital and online business. We must all take responsibility to change this!” Natalia Nicholson, Director of Women in Digital Business (WIDB)
(WIDB) crowdfund aims to provide funds to at least 10 female led UK entrepreneurs who
have viable business ideas. For a modest donation, your company will receive extensive social media coverage and a WIDB badge is also provided. The WIDB badge can be displayed on your social media, promotions, your website and correspondence, to show everyone that you embrace social responsibility, diversity and inclusion in the workforce. For more information on the Crowdfund and to donate please click here
