Corporate social responsibility (CSR) — often considered a delicate combination of ethics and profits — is gaining currency with organizations of all sizes because of the benefits to both society and the bottom line.
For example, Forbes and Just Capital partnered to publish the 2019 “Just 100” list ranking the top 100 companies “that are taking the public interest into their own hands and generating better returns for themselves and society in the process.”
Topping the list are technology giants Microsoft, Intel, Alphabet (Google’s holding company), Texas Instruments and IBM.
“Leading American corporations have increasingly begun to hold themselves to standards in all sorts of areas involving the public interest — from wages to paid leave to emissions — that the current government shows no interest in mandating,” Forbes notes.
According to Forbes, “Wall Street’s needs — more revenue, less cost — are increasingly dovetailing with the needs of workers, consumers and the public interest.”
We will likely see this trend grow more prevalent with businesses large and small over the next few years. An article by Entrepreneur.com predicts, “...We are fast entering an age where it may be almost impossible to divorce social impact from business goals.”
Companies that pursue positive social impacts have found several benefits that positively impact the bottom line. We’ve summarized several of the top benefits reported in both the Forbes and Entrepreneur articles below.
Attract and retain the best talent. Millennials, born between 1981 and 1996, are the largest generation in the U.S. labor force, and 79% report considering a company’s CSR in deciding where to work (Score.org).
Win customer loyalty. A finding from Emerald Insight (as reported in the Entrepreneur.com article) states that “perceived CSR has a significant impact on customer’s trust and loyalty and serves as a key mediating variable in service recovery.”
Increase brand awareness. Whether it’s reducing your carbon footprint, raising wages, providing extended maternity or paternity leave, raising money for a cause, or any number of ways to create positive change, your CSR efforts can help your brand stand out.
A word of caution before you jump on the CSR bandwagon. Authenticity is key.
PR Daily reports that promoting corporate social responsibility can be a balancing act: “While public relations teams want to get the word out, care must be taken to strike the right tone… The practice of promoting the image of a corporation as being socially responsible just to reap the marketing benefits, known as ‘greenwashing,’ may work temporarily but draw a backlash when consumers realize a brand isn’t being authentic.”
For those small- and mid-size businesses that think only large companies have the resources to develop and implement a corporate social social responsibility plan, there are ways to be strategic in how to approach a CSR plan to use more modest resources and still have positive social impact. The Small Business Administration (SBA) advises to start with one cause at a time, and find a cause employees are passionate about. They also suggest focusing efforts locally to begin, explaining that nearly “two-thirds of mid-sized companies focus their CSR programs within their home state, and most work with between one and five nonprofits to focus their local initiatives.”