Your company’s goal is to generate profits that sustain your business, pay employees and vendors, and provide resources for growth. A common misperception is that you must choose between making these profits and corporate social responsibility (CSR). In fact, it isn’t a choice. By acting ethically, supporting social causes important for your target market, and implementing sustainable business practices, you actually increase profits in today’s marketplace. That’s especially true for younger consumers who are willing to pay more for products produced ethically and companies who live values shared by their target market. Half of the consumers are willing to pay 50% more, 80% are willing to pay 30% more, and 10% are willing to pay more than 50% more for brands that reflect their values, according to the study.
In another recent study of UK consumers
40% have stopped using a brand (or never used it in the first place) because of its values or behaviours. 63% believe that brands have a responsibility to give back to society and 80% highlighting environmental impact as a particular concern.
At a time when people are more concerned with ethical and sustainable business practices, it’s vital to align your brand with values and principles that matter to your market. To get started, take a look at these 5 ways to help your brand show corporate social responsibility:
Demonstrate corporate social responsibility
Defining sustainability isn’t always easy but there is:
broad consensus that sustainability can be viewed as a holistic system, inclusive of nature and man-made, that needs to be regenerative and balanced in order to last a very long period of time. In the business-world, sustainability is viewed as a form of triple-bottom-line reporting system whereby a business enterprise communicates to their stakeholders. [source]
Therefore, sustainable business practices look like this:
Whatever type of business you run, there are ways to make your organization more sustainable and environmentally friendly. From switching to renewable energy to power your offices to using biodegradable packaging, you can reduce the negative impact your company has on the environment in a variety of ways.
Ensure compliance with regulations
All businesses must comply with the laws and regulations of the countries where they operate. Commonly, rules and regulations vary by country and often vary depending on your market sector. For instance, special regulations in the US impact marketing businesses like CanSpam, which makes it illegal to email people without their express permission or a prior relationship. These rules or ones similar, also govern businesses operating in the EU. In this instance, compliance helps you avoid legal action and subsequent financial penalties. Violations of CanSpam involve a fine of $10,000 per occurrence, for instance.
As businesses can be required to adhere to a range of different regulations, it’s useful to access advice and guidance. For instance, I worked with a client in Mexico who was fined multiple times by different governmental groups for following the guidance of the other group. With the National Life lawsuit blog and similar sources for the countries where you operate, for example, you can find out how to avoid lawsuits and fines by ensuring compliance with prevailing regulations. This protects your business from reputation damage and, by demonstrating corporate social responsibility, you make your brand more attractive to buyers.
Make your company values public
Having an established set of values or principles displayed on your website and other materials is great but it’s not enough. You must incorporate your values into your decision-making and they should guide day-to-day as well as strategic actions. Sharing your values both actively and passively greatly impacts consumers while being transparent in applying your values binds consumers to your brand. When you publicize your company’s values, they become part of your brand and your target market will recognize your organization as an ethical business. What’s more – making your brand values public means you are inspired to uphold them – and held to account if you don’t!
Prioritize people over profits
The second stool of the triple bottom line is people. All too often, companies focus on financial performance while overlooking their biggest asset – their workforce. The people that work for you and with you are individuals who have their own goals, challenges, and personal lives. While every business wants to ensure that their staff is committed to fueling company success, overworking staff or ignoring employee concerns could cost your business in the long run.
By prioritizing people – both your human resources and your target audience – you can ensure that your business has a positive impact on people’s lives while making a profit in the process.
When we talk about corporate social responsibility, we mean paying employees fairly for their work, committing to a diverse workforce, and instituting policies of fairness and equity. But, don’t stop there. Acting responsibly extends to your vendors and corporate customers. For instance, Starbucks only deals in “fair trade” coffee that ensures small growers are paid fairly for their crops. Fairtrade also means companies work with growers to ensure safe working conditions and that they employ sustainable business practices to their farming. Consumers worldwide support Starbucks’ efforts through their consumption choice.
Acting with corporate social responsibility also impacts business relationships, despite the fact we think of these relationships as rational decisions. For instance, I once worked with a client who received notification prior to a strike impacting a supplier. The supplier not only notified him of the impending strike but made arrangements to ensure supply through another vendor during the strike to ensure my client wasn’t affected. Obviously, my client was very loyal to this vendor.
Lead by Example
When you set a good example, you’ll inspire others to follow your lead. This means that ethical practices need to come from the top down. Whether it’s chairmen and women or directors and executives, business leaders must embody the ethical practices you want for your company.
You can encourage employees and vendors to emulate your behavior. For instance, some organizations provide time off for employees to donate their time to the community or help employees with financial sponsorships in the form of team sponsorships or advertising in local events. Finally, investing in your employees through training and scholarships shows you support their continued growth.
Shaping an ethical business
Becoming an organization reflecting corporate social responsibility sounds harder than it is. In practice, most ethical principles and sustainable business practices are widely accepted by society and easy to live by. As you integrate them into the workplace and the decision-making process, you’ll find that letting ethical values guide you makes for a happier and more successful working environment.
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