Definition of Corporate Social Responsibility
What CSR basically means is that a business does more for the wellbeing of others than required in an economical (make a profit) and legal (obey the law) sense.
Different types of CSR
- Environmental CSR: focuses on eco-issues such as climate change.
- Community based CSR: businesses work with other organizations to improve the quality of life of the people in the local community.
- HR based CSR: projects that improve the wellbeing of the staff.
- Philanthropy: businesses donate money to a good cause, usually through a charity partner.
Although most companies in the world today agree that corporate social responsibility is part of daily business practice, this idea is not shared by everyone. This is the so-called business to business approach.
Advantages of Corporate Social Responsibility
5 reasons why should you get involved in CSR
In today’s digital, fast speed world, each business, small or big, needs to have a CSR program in place. If CSR is not yet part of your daily business practice, you must act fast. Or else you’ll loose the trust of the people who are important to your business.
Believe it or not but the expectations of your staff, customers and the wider community have changed. You are no longer in control. They are.
So why CSR?
1. Satisfied employees.
Employees want to feel proud of the organization they work for. An employee with a positive attitude towards the company, is less likely to look for a job elsewhere. It is also likely that you will receive more job applications because people want to work for you.
More choice means a better workforce. Because of the high positive impact of CSR on employee wellbeing and motivation, the role of HR in managing CSR projects is significant.
2. Satisfied customers
Research shows that a strong record of CSR improves customers’ attitude towards the company. If a customer likes the company, he or she will buy more products or services and will be less willing to change to another brand.
IBM study ‘Attaining Sustainable Growth through Corporate Social Responsibility’: The majority of business executives believes that CSR activities are giving their firms competitive advantage, primarily due to favorable responses from consumers.
Better Business Journey, UK Small Business Consortium: “88% of consumers said they were more likely to buy from a company that supports and engages in activities to improve society.”
3. Positive PR
CSR provides the opportunity to share positive stories online and through traditional media. Companies no longer have to waste money on expensive advertising campaigns. Instead they generate free publicity and benefit from worth of mouth marketing.
4. Costs reductions
Yes, you read this correctly. A CSR program doesn’t have to cost money. On the contrary. If conducted properly a company can reduce costs through CSR.
Companies reduce costs by:
- More efficient staff hire and retention
- Implementing energy savings programs
- Managing potential risks and liabilities more effectively
- Less investment in traditional advertising
5. More business opportunities
A CSR program requires an open, outside oriented approach. The business must be in a constant dialogue with customers, suppliers and other parties that affect the organization. Because of continuous interaction with other parties, your business will be the first to know about new business opportunities.
6. Long term future for your business
CSR is not something for the short term. It’s all about achieving long term results and business continuity. Large businesses refer to: “shaping a more sustainable society” (Vodafone 2010 report):
“ Deliver a sustainable society in which business and its stakeholders can prosper in the long term”