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Social responsibility in business, also known as corporate social responsibility, or CSR, is "a form of international private business self-regulation which aims to contribute to societal goals of a philanthropic, activist, or charitable nature by engaging in or supporting volunteering or ethically-oriented practices." It's a way for businesses to stay accountable and regulate their societal and environmental impact, and a broader term for corporate citizenship. CSR initiatives that align with your business model, values, vulture, and organizational goals ensure that you have a positive brand identity. Ethical leaders know how important the successful implementation of a CSR strategy is to business operations. Communicating your CSR programs and strategies to key stakeholders can ensure their buy-in and engagement. In addition to that, dedication to corporate social responsibility can help your organization remain union-free.
We'll cover some of the most socially responsible companies that provide a great example of what CSR looks like and its impact on business culture. We'll define social responsibility and see real-world examples of CSR strategies. In today's world, responsible businesses fully embrace social responsibility, not simply selling a product or looking to gain more customers. They understand the importance of a company's social and environmental impact; it's the right thing to do.
There are significant direct and indirect benefits for companies that choose to implement socially responsible practices. It's wise for an organization to be socially responsible, as it exemplifies their care and compassion for the employees who work there and the customers that purchase their products, goods, or services. There are environmental and social justice benefits for their local communities, and the positive impact will also extend to their employees and workplace culture. Being socially conscious helps businesses earn customer trust and increase employee engagement. Charitable giving and volunteer efforts show that a company believes in more than just profits and truly cares about the people they serve and the communities they can positively impact.
It's become increasingly more important for companies to have transparency and empathy at the foundation of their corporate policies and business models. Organizations that are authentic in their values are more attractive places to work, and consumers can vote with their dollars to support them. Employees and leaders working in a business that embodies strong examples of social responsibility often exemplify organizational citizenship behaviors, meaning they are altruistic and represent the organization well, even outside work.
There are a few examples of companies that have taken corporate social responsibility seriously and implemented CSR initiatives well. You'll notice that these companies have strong customer loyalty while remaining heavily focused on environmental sustainability and making a positive difference in the lives of their customers, employees, and communities nation- and often worldwide.
Ben and Jerry's is well-known for exemplifying what social responsibility in business looks like. This rings especially true regarding the environment and causes they feel passionate about. They are heavily focused on doing their part to reduce climate change. The company website has an entire page dedicated to the way they do business, including their commitment to using more climate-friendly, greener freezers, a more productive and environmentally friendly way of disposing of their waste and using responsibly sourced packaging.
Ben and Jerry's also focuses on not just their environmental impact but the societal impact. The business pledges to be Anti-racist, working to drive racial justice and equity through their business decisions. They established the Ben and Jerry's Foundation, a social justice organization, in 1985 to support "grassroots organizations" across the country that positively impact their communities and work for social change. The foundation has several grant programs that are employee-led on a volunteer basis. Clearly, their philanthropic work has had a massive positive impact, and some of the nonprofit organizations they are currently providing grants to include Denver Homeless Out Loud and RISE St. James. This organization aims to fight neighborhood contamination in their Louisiana town.
The company also has b corp certification, which means the business is recognized as having "the highest standard for corporate social responsibility." Furthermore, B Corps are a "new type of corporation that uses the power of business to solve social and environmental problems."
This certification comes from a nonprofit group named B Lab, which, from their website, describes itself as a "nonprofit network transforming the global economy to benefit all people, communities, and the planet." For a company to obtain b corp certification, the B Corporation website says the company must do all of the following:
Considering that Ben & Jerry's has a 4-star rating on Indeed and a 4.2-star rating on Glassdoor, it becomes clear that they do not just implement successful environmental initiatives. They champion diversity, equity, and inclusion, work to support marginalized communities, and their business model is one that employees enjoy working for. For Ben and Jerry's, it's clear that corporate social responsibility is at the heart of what they do.
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Another successful corporate social responsibility example is Toms. Another b corp-certified company, Toms, aims to use 100% sustainable cotton by 2025. They use 80% recycled materials and source 100% of their packaging from sustainably managed forests. Toms aims to positively impact three main categories: Purpose, People, and Planet. They pledge to give 1/3 of the company's profits to what they call "grassroots good," -- which includes cash grants and support for community organizations. They have a transparent annual Impact Report, which shows almost half of their donations last year in marginalized communities were for mental health resources at 44%, while 38% went to increasing access to opportunities, and the remaining 18% was allocated to ending gun violence. In 2021 alone, they gave over $2 million in cash grants to over 43 organizations, stating that they positively impacted 427,197 lives last year.
Overall, Toms aims to maintain a culture with a strong Diversity, Equity, and Inclusion foundation that is Anti-racist while helping marginalized communities and having a positive impact on the planet.
If you're an outdoor enthusiast or avid hiker, or camper, you're probably familiar with this household name. Even if you don't consider yourself particularly outdoorsy, you're likely aware of their commitment to the environment and their mission to incorporate more sustainable ways of creating the goods they sell. The company, which was founded in 1973 by rock climber and environmentalist Yvon Chouinard, was built on the premise of sustainability. Eventually growing to become a billion-dollar organization, Patagonia is also a B Corp certified company.
Acknowledging the harm that clothing companies traditionally have on the planet, and even on the factory employees, who are often underpaid and treated poorly, Patagonia has several social responsibility programs in place to ensure safe, fair, legal, and humane working conditions. These include being founding members of the Fair Labor Association and Fair Trade certification. They've pledged to donate 1% of all of their sales to the preservation and restoration of the natural environment, giving the funds to nonprofits who are working to "defend air, land, and water" around the world. They source almost all of their energy from renewable energy sources, which is largely uncommon in the clothing industry, aiming to be completely carbon neutral by 2025. But Patagonia isn't stopping there; you can read more about how their answer to climate change is "systems change" on their climate goals page here.
Corporate social responsibility in business is not only good for society, marginalized communities, and the environment, but it is also ultimately good for business. Consumers are increasingly interested in social responsibility, and they're more likely to purchase from companies that align with their values, also known as "voting with their dollars." In addition, employees are also more likely to be engaged and more loyal to organizations that are committed to social responsibility.
Being a good corporate citizen doesn't simply boil down to using sustainable materials and seeking alternative energy sources. Yes, it may include a lot of environmentally and socially conscious initiatives, but it's important to understand the impact that these initiatives have on employees at every level. Employees who feel that their own values, beliefs, and morals are also reflected by the company that they work at are more likely to be productive and motivated. Generation Z, those who were born approximately 1997-2012, has already begun to enter the workforce en masse. It's predicted they will make up around 27% of the workforce by as soon as 2025. And one of their primary concerns is climate change and the environment.
A recent Deloitte study showed that Gen Z isn't as concerned with the quality of products they are purchasing as they are with the company's social and ethical impact. In fact, 77% of respondents answered that they feel it's very important to work at organizations whose values align with their own.
Ultimately, it's more important than ever to adopt corporate social responsibility initiatives in your organization. It's a win-win-win; for your business, your employees, and the environment.
Walter is IRI's Director of Digital Solutions and founder of UnionProof & A Better Leader. As the creator of Union Proof Certification, Walter provides expert advice, highly effective employee communication resources and ongoing learning opportunities for Human Resources and Labor Relations professionals.