“Doing well by doing good is no longer just a competitive advantage. It’s becoming a business imperative.”
A study by Horizon Media’s Finger on the Pulse found that 81 percent of Millennials expect companies to make a public commitment to good corporate citizenship. This demonstrates that this generation (born 1981 to 1996) places a premium on corporate social responsibility (CRS) efforts. With all else equal, they are more likely to purchase from a company that does right by people first.
In this blog, we’ll explore social responsibility and how it’s impacting the success of businesses.
Why social responsibility?
Social responsibility in business, also known as corporate social responsibility (CSR), means that people and organizations behave and conduct business ethically. They will be sensitive toward social, cultural, economic, and environmental issues. So, whether that means championing women’s rights, protecting the environment, or paying their employees a livable wage, CSR shows customers that businesses are taking the proper steps. It not only helps them to conduct their business morally and ethically, but it also makes them more attractive to consumers and stakeholders. It can bolster a company’s image and build its brand along the way.
Can a company be financially successful while being socially responsible?
For a long time (and even still today), companies shied away from taking socially responsible actions because they tend to be more expensive. This has been a long fight within corporate America. Take McDonald’s for instance. In 2011, McDonald’s announced plans to switch to cage-free eggs. The fast-food giant re-upped that commitment once again in September 2015. However, while nearly half the public (47 percent) stated that they were more likely to order foods made from cage-free eggs and poultry, only about 17 percent said they’d be willing to pay more for it.
This often puts businesses in a tough spot. They know that it makes their company more attractive to take socially responsible actions, but they aren’t quite sure how to make it happen financially. Social responsibility is an investment in long-term success, and it often relies on making choices that could make the business model slightly more expensive.
Why should businesses put people first?
The bottom line of CSR is to cultivate positive brand recognition, increase customer loyalty, and attract top-tier employees. When businesses put people first (rather than finances), they are able to achieve increased profitability and long-term financial success. A people-first culture gives the company greater value internally. It increases job satisfaction levels and retention rates and enhances the products and services that eventually go out to consumers. A clear and effective CSR strategy will boost companies in numerous ways – even if it takes a little longer.
While startup founders think it’s impossible to achieve financial success on a socially responsible platform, this simply isn’t true. There are popular brands that have done just this. Think Ben & Jerry’s, Warby Parker, Salesforce, Patagonia, and so many more. Corporate social responsibility only makes your company more attractive to all the people involved in it. Don’t underscore that value and how it can translate to your economic success.