Corporate Social Responsibility: What is It and Why Does It Matter?
Published July 5, 2022
Almost every day, we hear news of businesses and large corporations bending the law for their own gain. Most of the time, they do so at the expense of their employees or consumers. It’s no wonder then that the words “corporate” and “social responsibility” don’t always go together.
But in recent years, many businesses have started to adopt corporate social responsibility (CSR) as part of their operations.
So what exactly is CSR? More importantly, why does it matter?
In this post, we’ll shed some light on the real meaning of CSR and why it matters.
What is Corporate Social Responsibility (CSR)?
Corporate social responsibility is a business concept where accountability is woven into the organization’s overall strategy. It can also be defined as the self-regulating measure of a business entity to hold itself accountable to society.
In short, corporate social responsibility is a business organization’s way of giving back to the community and creating a better world.
But contrary to popular belief, CSR is different from charity or philanthropy. It’s a management concept that goes beyond making donations or holding fundraisings.
As I’ve said, it’s about weaving social responsibility into the very fabric of a company’s business strategy. Its main goal is to effect a long-lasting and tangible change, more than just temporary poverty alleviation. Or at the very least, making sure that, in the normal course of your operation, you’re making positive contributions to society and the environment instead of adding to its problems.
Why Does CSR Matter?
So, why do businesses have to care about CSR? Here are the top reasons why CSR matters:
1. It makes the world a better place.
This is one of the most important reasons why CSR should be integrated into your operations.
Business owner or not, we all dream of having a better world for ourselves and our descendants. And recognizing our accountability to our employees, customers, and the environment is a step in the right direction.
Just imagine if all businesses put greed aside and start caring for the people and the environment more than making money. The world will undeniably be so much better.
2. It inspires employee loyalty.
According to asurvey, employees are much more productive if they can see that their employer has morally-motivated motives for its CSR activities. Whileanother survey shows that purpose-driven companies tend to retain employees up to 40% higher than their competitors.
Millennial and Gen Z workers also tend to prioritize good working culture and the company’s social impact over financial benefits.
Obviously, attracting and retaining top talents helps your business save on training costs. Plus, reducing your employee turnout also reduces disruption in your normal operations.
In short, adopting CSR does not only benefit society. It can positively impact your business too.
3. It encourages brand confidence.
Consider putting yourself in your customer’s shoes. Would you support a product that you know was made by a business with a shady reputation? Probably not.
In recent years, many companies have taken the flak for their unethical business practices. It caused a PR nightmare for these companies and people started to boycott their products.
This just illustrates how CSR changes consumer perception and inspires brand confidence. You won’t even need to aggressively promote your products and services. Your reputation will precede you.
But if you’re only doing CSR because you want to build your brand’s reputation, just forget it. People will eventually see through you, especially with today’s very socially-conscious consumers.
What to Keep in Mind
Corporate social responsibility is a commitment. It’s not something you do just for a day. You might receive positive reviews from that fundraising activity you did today. But if you keep engaging in unethical business practices, people will eventually find out.
Remember that CSR is about integrating social responsibility into your organizational goals and strategies. You don’t even need a large budget to adopt CSR. Just making sure that you’re not harming the environment and the people around you in your normal course of operation is already a step in the right direction.
(Related: What Is Spiritual Entrepreneurship?)
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About The Author
Judy Ponio is a professional writer and SEO specialist. She works hard to ensure her work uses accurate facts by cross checking reputable sources. She is the lead author for several prominent websites covering a variety of topics including law, health, nutrition, and more.
Correct Digital, Inc is paid by private donors to provide website digital marketing services to this non-profit organization.