- Corporate social responsibility, or CSR, is a form of self-regulation that reflects a business’s accountability and commitment to contributing to the well-being of communities and society through various environmental and social measures.
- CSR plays a crucial role in a company’s brand perception; attractiveness to customers, employees, and investors; talent retention; and overall business success.
- A company can implement four types of CSR efforts: environmental initiatives, charity work, ethical labor practices and volunteer projects.
- This article is for business owners who are looking to implement or improve CSR initiatives and want to learn more about the benefits, best practices, and potential pitfalls.
The definition of business success goes beyond profitability, growth rate and brand recognition. In today’s world, customers, employees and other stakeholders judge a company by how its activity impacts the community, economy, environment and society at large. In other words, by whether it cares about the greater good and not only greater profit. Corporate social responsibility practices are a way to demonstrate your business’s stance on the matter.
What is corporate social responsibility?
Corporate social responsibility is a type of business self-regulation with the aim of social accountability and making a positive impact on society. Some ways that a company can embrace CSR include being environmentally friendly and eco-conscious; promoting equality, diversity, and inclusion in the workplace; treating employees with respect; giving back to the community; and ensuring business decisions are ethical.
CSR evolved from the voluntary choices of individual companies to mandatory regulations at regional, national and international levels. However, many companies choose to go beyond the legal requirements and embed the idea of “doing good” into their business models.
There is no one way a company can embrace CSR, but one thing is certain – to be perceived as genuine, the company’s practices need to be integrated into its culture and business operations. In today’s socially conscious environment, employees and customers place a premium on working for and spending their money on businesses that prioritize CSR. They can detect corporate hypocrisy.
To ensure CSR authenticity, a company should look at its values, business mission and core issues and determine which initiatives best align with the business’s goals and culture. The business can do this internally or hire a third party to conduct an assessment.
Reviewing the United Nations 17 Sustainable Development Goals is a good place to start. While goals like Good Health and Well-Being or Gender Equality can apply to most businesses, specific goals like Life Below Water or Affordable and Clean Energy may be relevant to select industries like water technology or energy providers