Corporate Social Responsibility has always had a way of promoting a business or company’s reputation, thereby improving product or service patronage and sustaining business growth.
Corporate social responsibility is increasingly more important today and can take on various forms, including product donations, financial contributions, employee community service, eco-friendly practices, and many more creative ways by which businesses, small and large, can give back to their communities.
Right from time, Corporate Social Responsibility has always been the means by which the public can hold companies accountable for their actions.
While it’s inarguable that most corporate responsibility efforts benefit society, it is important to restate that it is also helpful for company leaders and business owners to evaluate how these initiatives also positively impact the companies that carry them out.
Here are five major ways in which Corporate Social Responsibility (CSR) contributes to sustaining the growth of any business.
Positive Reputation Building
One of the most powerful effects of sustainable, responsible business is its ability to quickly generate positive publicity for an organization. In addition to press and social media coverage, many major business awards assess corporate citizenship when choosing companies to recognize.
On the other hand, organizations that fail to take responsibility for corporate actions can severely damage their reputations. Consider the annual Public Eye Award, which names companies that demonstrate poor ethics, cause environmental damage, and commit human rights violations.
As corporate social responsibility initiatives have become more common, consumers are increasingly interested in patronizing businesses that support causes they value. Research has proven that most consumers would pay a higher price for goods sold by socially responsible companies.
Business owners can benefit from partnering with charities that are important to its customers. For example, an outdoor sports and recreation store that donates a percentage of its revenue to wildlife and forest preservation is not only remaining true to its brand, but it’s helping solve a global issue that is likely a priority for its consumer base.
Consumer appeal often increases when a customer’s behavior is directly linked to charitable efforts. This direct link between a purchase and a charitable donation provides greater motivation for customers to spend money, connect with the brand, and develop loyalty.
Attraction and Retention of Talented Employees
Consumers are not the only people drawn to an organization’s commitment to improving the world. Increasingly, talented professionals , especially those looking for business management careers, consider whether a company’s core values match up with their own when they apply for jobs.
Many organizations usually more than make up for the time and money spent on community service with higher earnings that result from top talent recruitment.
Corporate social responsibility also plays a major role in employee satisfaction and retention. When a company’s leadership involves employees in making decisions about which charities to serve or how to help them, it gives employees a greater sense of investment in the organization.
Another major way corporate social responsibility leads to greater employee satisfaction is during team or company-wide service outings.
Such opportunities allow employees to take a break from the office and hone different skillsets. Service days also provide great bonding opportunities during which various teams and departments can have meaningful interactions that improve relations back at the office.
Stronger Client and Community Relations
In general, seeing one company do charitable work can inspire other organizations to follow suit, both on a local and a more global scale. This gives savvy corporations the opportunity to work with other companies, (which may include potential clients or collaborators), and also develop valuable relationships while contributing to the greater good.
Community-based service events also allow employees and community members to have meaningful interactions, giving the business greater recognition and positive associations with its potential customers.
Attaining Business’s Ultimate Goal
No business leader would deny that a company’s ultimate goal is to make money. While focusing on corporate responsibility can come at a cost, it can also have a positive net effect on a company’s bottom line.
All the previously mentioned benefits – reputation building, customer appeal, talent retention and increased connections – can significantly improve a company’s financial health. However, responsible choices on their own can also be favorable for a company’s bottom line.
Sometimes a business’ corporate conscience and sustainability efforts can ensure its own future survival. Companies can do well by doing good, specifically by adopting the broader perspective of serving all stakeholders rather than merely the shareholders.