The average consumer has been hoping for more from the big corporations looming over them and affecting every element of their daily lives, so that’s led to increased discussion of corporate social responsibility (or CSR, for short). We recognize the need to ensure business organizations maintain a special obligation to do what’s considered morally right, given the power they have over the general population.
Many people have been expressing concern that corporate activity has been beyond detrimental to the Earth’s environment and climate, discussions that have been ever more topical as the planet faces repeated environmental crises, which have been attributed to climate change caused by industrial activity. Many people also live either paycheque to paycheque or in some degree of poverty, at contrast to the world’s most prominent business leaders. The gulf between the rich and poor seems to be more massive than ever, leaving large portions of the global population living in unfavourable conditions, and so, prompting an urgency to push for more substantial wages from corporate leaders.
The expectation that corporations should play their part in taking care of the planet and the people beneath them grows more pressing every day—and it becomes more obvious that corporate business people have to listen or lose out on the benefits of being considered socially responsible. CSR may be the key to companies staying in business going forward. There are some notable advantages to being perceived as a socially responsible corporation.
Leads to Higher Employee Engagement
The younger generation of workers, namely Gen Z and millennials, are especially determined to work for companies that have been demonstrating genuine corporate social responsibility. Increasingly, younger workers are factoring CSR efforts into their decisions on where to work—and the younger generations’ insistence that corporations be worth the 40-hour workweeks appears to be rubbing off on the entire collective of workers lately too, with LinkedIn reporting that 75% of job seekers are taking time to research a company’s red flags before sending in a job application. Red flags like discrepancies between PR’s words and the organization’s actions, as well as stinging customer and ex-employee reviews. What it’s like to work for a company, their social impact, and how they treat stakeholders like employees matter to candidates. A company with a reputation for damaging employees’ mental health and acting in a manner at odds with a universal picture of good will contend with high turnover and exhausted employees, if job seekers are even applying in the first place, and employees suffering from low morale will cost companies money.
Promotes Customer Loyalty and Boosts Profits
Business owners will probably be happy to find out that consumers are willing to pay slightly higher prices for products that are sustainably and ethically produced by a company that cares—this goes for rewarding and effective service as well. In other words, consumers don’t mind giving up a few more hard-earned dollars to a company they know they can trust, which means more profits to put toward expanding the business and bringing the products/services to a wider range of people. In addition, sustainable and ethical products that get the job done well and high-quality service will inevitably produce repeat customers or, at the very least, word-of-mouth recommendations—and brand loyalty is another way companies can expect to see increased revenue. There’s also something to be said about the cost-saving aspects of sustainability, like not having to spend as much on packaging.
Contributes to a Better World
Beyond all the benefits CSR can have for a company, it leads to an overall better global social climate. With most of the general public demanding companies act as forces for positive change, the onus is on corporations and other business entities to genuinely improve how they operate in order to avoid the consequences of being deemed “not socially responsible.” They must sincerely make efforts to be more sustainable (no greenwashing allowed), treat stakeholders with respect, and distribute their financial gains equitably (i.e., compensate employees fairly). Holding these corporations, which have significant power over the world and its affairs, accountable and refusing to do business with them unless they are socially responsible is not only preventing businesses from abusing their power and making choices that harm the planet and its people, but also pressuring them to leverage their power for the greater good. Everyone benefits from a system in which megacorporations are called to reduce their carbon footprint and keep human stress levels at a minimum.
Luke Miles | Contributing Writer