Consumers consider more than quality goods and services when choosing a brand. Many are prioritizing corporate social responsibility (CSR), and holding corporations accountable for effecting social change with their business beliefs, practices and profits. In fact, some will even turn their back on their favorite companies if they believe they're not taking a stand for societal and environmental issues.
"Corporate responsibility is simply a way for companies to take responsibility for the social and environmental impacts of their business operations," said Jen Boynton, vice president of member engagement at 3BL Media. "A robust CSR program is an opportunity for companies to demonstrate their good corporate citizenship … and protect the company from outsized risk by looking at the whole social and environmental sphere that surrounds the company."
To illustrate how critical CSR has become, a 2017 study by Cone Communications found that more than 60 percent of Americans hope businesses will drive social and environmental change in the absence of government regulation. Most consumers surveyed (87 percent) said they would purchase a product because a company supported an issue they care about. More importantly, a whopping 76 percent will refuse to buy from a company if they learn it supports an issue contrary to their own beliefs.
"CSR creates a filter for the actions of a company," said Wendy Burk, CEO of Cadence Travel. "It keeps organizations accountable and ethical."
But consumers aren't the only ones who are drawn to businesses that give back. Susan Cooney, head of global diversity, equity and inclusion at Symantec, said that a company's CSR strategy is a big factor in where today's top talent chooses to work.
"The next generation of employees is seeking out employers that are focused on the triple bottom line: people, planet and revenue," said Cooney. "Coming out of the recession, corporate revenue has been getting stronger. Companies are encouraged to put that increased profit into programs that give back."
Ways to practice CSR
Recognizing how important social responsibility is to their customers, many companies now focus on and practice a few broad categories of CSR:
1. Environmental efforts: One primary focus of corporate social responsibility is the environment. Businesses regardless of size have a large carbon footprint. Any steps they can take to reduce those footprints are considered both good for the company and society.
2. Philanthropy: Businesses can also practice social responsibility by donating money, products or services to social causes. Larger companies tend to have a lot of resources that can benefit charities and local community programs.
3. Ethical labor practices: By treating employees fairly and ethically, companies can also demonstrate their corporate social responsibility. This is especially true of businesses that operate in international locations with labor laws that differ from those in the United States.
4. Volunteering: Attending volunteer events says a lot about a company's sincerity. By doing good deeds without expecting anything in return, companies can express their concern for specific issues and support for certain organizations.
Building a socially responsible business
Undertaking socially responsible initiatives is truly a win-win situation. Not only will your company appeal to socially conscious consumers and employees, but you'll also make a real difference in the world.
Cooney stated that in CSR, transparency and honesty about what you're doing are paramount to earning the public's trust.
"If decisions [about social responsibility] are made behind closed doors, people will wonder if there are strings attached, and if the donations are really going where they say," Cooney said. "Engage your employees [and consumers] in giving back. Let them feel like they have a voice."
For instance, Burk added, Cadence gives $100 each year to the charity of choice for each employee.
"Start integrating your ethos into your culture," Burk said. "Even if you don't have a huge cause to focus on as an organization, you can always start with what is important to your employees."
You should also involve your consumers, allowing them to see firsthand the work you are doing for your community.
"If a brand has good news to share, like organic ingredients or recycled content, they should let consumers know," said Boynton. "Consumers deserve to share in the good feelings associated with doing the right thing and many surveys have found that consumers are inclined to purchase a sustainable product over a conventional alternative. Announcing these benefits is a win-win from both a commercial and sustainability perspective."
Maintenance is another major part of CSR. You must actively and consistently work on your process; it's not a one-time deal.
"To keep your CSR efforts thriving, you need momentum and passion, and that have to come from the top," said Burk. "Your stakeholders need to be fully committed. Focus on responsibilities that are meaningful and relevant to you, your clients, your employees, and your partners."
For some great examples of small businesses that put CSR at the heart of their operations, check out this Business News Daily article.
Additional reporting by Nicole Fallon. Some source interviews were conducted for a previous version of this article.