Does your CSR Measure Up? How to Boost your Corporate Social Responsibility
Corporate social responsibility (CSR) is when a business operates ethically, within both the environments and communities that it functions in. This is often illustrated through the triple bottom line, a business framework that focuses on social impact, environmental conservation, and financial responsibility. The CSR movement has been propelled by growing consumer sentiment that demands businesses should be held accountable for the social and environmental impact they cause in the pursuit of profit. What was once just considered ‘best practice business culture’ is now a consumer expectation. IBM's Meet the 2020 consumers driving change’ report found that over 70 per cent of consumers across 28 different countries are willing to pay more for a product that has been developed with CSR. This social awakening continues to grow as CSR converts millennial consumers into long-term shoppers through integrating value-based community engagement into their business strategy. Ethical business practices improve both consumer perceptions and brand loyalty which results in a competitive business edge and improved profitability.
Incorporating social responsibility into a business model
With these numerous internal and external benefits of implementing CSR, leaders face the question of ‘how?’. For a successful transition towards CSR in Australia, there are steps businesses can take at every level of an organisation. The Research & Social Policy Team at The Smith Family, outlines some of these key elements, below.
1. Strategic vision
Ensure that the company’s vision and strategic road map incorporates corporate social responsibility. The triple bottom line framework should guide the company’s mission statement and ensure that the business’ focus is on the social and environmental impact, as well as profit.
2. Organisational leadership
Foster a leadership team that is dedicated to the company’s CSR vision and understand the short and long-term changes needed to achieve its CSR goals. Top managers set the tone for a business with employees looking to them for guidance and direction. Ensuring organisational leaders support CSR initiatives will help set an example for all other employees.
3. Employee participation
Employees are the backbone of any organisation and they should be inspired and motivated by their employer’s socially responsible practices and initiatives. Engaging employees in the sustainable direction of the business and gaining their insight into new ways of working allows them to become advocates and drivers of these CSR practices.
4. Financial investment and decision-making
Businesses need to understand the social and environmental impact their decision-making has. Rather than a profit or socially responsible approach, businesses should focus on innovation and updated ways of working which allow them to meet the triple bottom line. Prioritising stability, longevity, and sustainability over quick profit is a form of business social responsibility.
Implementing CSR policies into a business
While corporate social responsibility is looked at holistically, there are various ways to implement specific CSR policies into your business. These policies can focus on different elements of CSR, be it:
- Protecting consumers
- Maintaining employee wellbeing
- Safeguarding suppliers
- Preserving the environment
- Supporting local communities
The top three CSR policies that can be integrated into your business model are outlined below.
Improve business transparency
With best practice always in place, sustainable and socially responsible businesses can become ambassadors within their industry. To improve employee and consumer trust, adopt transparent and open policies that demonstrate the business is operating according to its CSR company values. Transparency can come in several forms like providing information on supply chains or labelling products with additional information.
Patagonia is a clothing company that promotes brand transparency and accountability, they detail their entire supply chain and how it is impacting the environment on the ‘Our Footprint’ section of their website, a decision that has improved their customer loyalty and brand reputation.
Adopt goals to improve environmental sustainability
According to the 2020 ‘Update of Carbon Majors’ report by the Climate Accountability Institute, twenty companies have collectively produced 493 billion tonnes of methane and carbon dioxide, 35% of all global emissions since 1965. This shows just how significant the role businesses play in contributing to greenhouse emissions is. Responsible businesses should develop a personalised action plan to reduce waste, lower their carbon footprint, and recycle whenever possible.
Engage with charities and volunteer work
Companies should demonstrate that they do not merely run to turn a profit, rather they are socially responsible enterprises helping the community around them. Integrating charity work into the business model is an ideal way of making a real impact on the not-for-profit sector.
Cotton On is a clothing brand that has a selection of products where 100% of proceeds go towards improving the youth’s access to education and healthcare. Similarly, hosting volunteer days empowers employees, instilling pride for their company whilst also attracting better talent. Cone Communications survey indicated that 78 per cent of millennials consider CSR when applying for jobs.
Corporate social responsibility case study: Rice Growers Association of Australia (RGA)
The Rice Growers Association of Australia (RGA) represents more than one thousand members and lends support to rice farmers in Australia. The RGA was alerted to a potential environmental threat, an endangered bird, the Australasian Bittern, which was forced to relocate to rice fields in NSW because of urbanisation and loss of habitat. While the primary focus of the RGA’S is to ‘support growers on issues affecting the viability of their business and communities”, they went above and beyond to facilitate an operation between rice farmers, government authorities and other key stakeholders to study and collect data on the Australasian Bittern’s new home amongst the rice. The Bitterns in Rice Project resulted in a biodiverse and healthy habitat for the Australasian Bittern without compromising the rice farmers crops.
The need for socially responsible leaders
As corporate social responsibility is placed in the spotlight by consumers, business leaders are expected to navigate these changing times. Swift, decisive, and thoughtful responses to environmental and community issues require qualified and well-trained leaders. Undertaking a Master of Business Administration prepares the next generation of leaders in corporate social responsibility. Griffith University’s 100% online MBA is designed with a sustainable focus and has specialised programs like ‘Sustainability and Systems Thinking’, ‘Developing Values-based Leadership’ and ‘Innovation for Impact’.
For more information about studying Griffith University's 100% online Master of Business Administration, call us on 1300 737 945 or book a call with an Advisor today.