I've been advising clients that they should have a Corporate Social Responsibility (CSR) plan for their business. I haven't met anyone that doesn't agree that it's a good idea. For most of them, the focus is on the profitability of their own company. That's understandable in the current economic climate.
So why should companies, especially SMBs, adopt a CSR strategy?
Because it's the right thing to do
It doesn't take a lot to convince someone that there are benefits to CSR. Most organizations already have incorporated some aspect of CSR. It's long been a common practice to recycle paper, switch off lights and buy local as much as possible. Sustainability and "green" initiatives are becoming a part of the office culture as much as the company water cooler and footy tipping. Numerous charities stage community events and encourage corporate teams to participate.
On a personal level, many of us sponsor children in third-world countries, put money in a collection plate at church or drop coins in the cans of the ubiquitous High Street charity campaigns. Parents regularly contribute their time and money to their children's schools, sports teams and social clubs.
These professional and personal initiatives can have significant impact on our communities and the not-for-profit organisations involved. Why do we need to establish a more formal CSR agenda in our businesses?
Because not doing it is going to cost you
There is growing data to suggest that organisations might lose business if they aren't addressing CSR. [url =http://www.westpac.com.au/internet/publish.nsf/Content/WI+Corporate+Responsibility]Westpac[/url], for instance, expects their suppliers to recognize and support their own CSR initiatives. Their website clearly states,
"Suppliers to Westpac Australia whether large or small and regardless of where in the world they are located are required to be compliant with the Sustainable Supply Chain Management Code of Conduct."
In other words, you're not going to be working with Westpac if you aren't a good corporate citizen.
As big corporations battle to regain public trust after the fiasco of the economic downturn, they are increasingly turning to a transparent CSR as a way to demonstrate good corporate citizenship. You can bet that, like Westpac, they're going to be looking for their suppliers, vendors and partners to be doing the same thing.
Governments are also beginning to demand corporate involvement especially as it relates to climate change. As emission trading schemes become a reality, the businesses that are going to come out ahead are the ones that have already addressed their energy consumption. Public sentiment is not waning on the issue of global warming and governments have no choice but to insist business becomes more sustainable.
Still, no one likes a mandate, especially when it's a potentially expensive one. Why should we let someone else define our business practices?
Because doing it is a clever way to increase your corporate profile
A recent article in Information Age Magazine called The Benefits of Being Good detailed the different ways large corporations and SMBs are benefitting from CSR. Overwhelming evidence points to CSR as a positive way for any organisation to define themself in the public eye.
Every time a business adopts a CSR initiative, it's a perfect opportunity to generate publicity. In a climate where the public is inundated with corporate malfeasance, a business that is openly promoting values-based policy decisions is viewed in a favourable light. While many CSR endeavours cost little or no money, the community goodwill they produce can be immeasurable.
An honest approach to CSR that addresses sustainability issues, community sponsorship and philanthropic activities may be the best marketing investment you could make. At the very least, a considered approach to CSR will put you at the forefront of what is quickly becoming a change in worldwide corporate culture.