The Importance of Corporate Social Responsibility
You’ve probably taken note of the initiatives in place to help protect the environment, from proper education on the recycling of garbage to community Clean Up the Park days. It feels fantastic to have left work knowing that you put effort into making your surroundings a better and healthier place. The trouble is that the change we so desperately require won’t be filled by individual acts or small companies alone.
Those environmentally altering changes lay considerably in the hands of the world’s largest conglomerates, and their efforts within corporate social responsibility, or more commonly known as CSR. Continue reading to see how the voice of the environment is finding its way into boardrooms across the globe and how different corporations have taken positive action and benefitted from listening to what the environment had to say.
If you’re still uncertain as to what the framework of corporate social responsibility is, the website Clim’Blog defined it as being “a continuing commitment by a business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.” To give a bit more context as to what CSR encompasses, we’ll define the 4 different facets that embody it:
1) Environmental: Initiatives in this sector focus on bettering the environments that we live in. Whether that’s buying renewable energy for your business, investing in a more circular economy, or even making it a goal to cycle to work the majority of the year.
2) Human rights: Initiatives in this sector usually involve providing fair labor practices, fair trade practices, as well as actively removing all connection to child labour practices. An example of this would be guaranteed equal pay for employees, regardless of race, gender, sexuality, disabilities, etc.
3) Philanthropic: Initiatives in this sector direct their attention to donating funds, goods, or services to other organizations or causes, including educational programs, health initiatives, or community-run projects. Prominent examples of this since the outbreak of COVID-19 are the monetary, spacial, and material donations by companies towards the production of masks for protection against COVID19.
4) Economic: Initiatives in this sector involve reflecting inwards on a company’s standard business operations to become more sustainable. For example, using a greener method of production to minimize overall waste. The certifications given by B Corporation and RSB are accurate shows as to which companies are putting their efforts towards this.
Everyone enjoys being viewed as an altruistic superhero, but who has the time these days to invest time and effort into something they’ll never gain rewards from? Then again the anonymous Greek proverb “Society grows great when old men plant trees whose shade they know they shall never sit in.” was written for a reason.
However, in today’s society, it’s beneficial for a company to ‘plant seeds’ in the world around them. Not only do they profit from ‘brand equity,’ including increased brand image, recognition, and reputation, but also several others. When potential customers see that a company they might support is not only producing excellent goods and services but doing so in a reputable manner, they become much more likely to send their funds in the direction of said company.
As economist and banker Mark Carney once stated “Firms ignoring climate crisis will go bankrupt,” and he couldn’t be closer to the truth! As societies grow, companies and industries that don’t succeed within CSR will find themselves falling behind in the races. Another benefit of moving to the greener pasture is the savings on operational costs. When a company invests in operational efficiencies it results not only in reduced environmental impact but also operational cost savings. Other advantages of practicing good CSR include: preserving essential employees, having easier access to funding, and reduced regulatory burden.
Assuring a corporation’s customer base of the effort they’ve allocated into CSR work is achievable through more ways than just marketing. The best way to gain the trust of a potential customer is by adopting a standard of certification, including audits. Many of these certifications exist because they pertain to different areas of work, such as carbon reduction and capture projects, biofuels and biochemicals, and social and environmental performance.
Here at Flightnook, we believe that it should be every corporation’s goal to be granted a certification. The Gold Standard certification is used to implement change and improve a company’s products, processes and employees through means of analyzing carbon reduction/capture projects and associated emissions while including a public registry for transparency purposes. The B Corporation certification isn’t just an entry-level pat on the back certification, but one based on a complete overview of the corporation’s social and environmental performance. Concentrating on the impact of the company’s operations and business model on its workers, community, environment, and customers. Whereas the RSB certification exists to validate bio-based feedstock, biofuel or biomass products, or by-products. Helping corporations find solutions for sustainability while reducing business risk, fueling the economy, and contributing to the UN Sustainable Development Goals. The RSB certification is commonly seen in the aviation industry when granted to airline corporations that use renewable energy to fuel their planes.
One brand that’s exceeding in all things CSR is American outdoor clothing company, Patagonia. Aside from the countless amount of hours they’ve spent volunteering, more than $185 million they’ve donated to nonprofit and environmental groups, Patagonia has also contributed $38 million into the funding of other socially responsible companies and ventures. Through these seemingly endless actions of altruism, Patagonia has seen massive increases in sales of up to $1 billion. Exhibiting that acts of kindness often show acts of kindness back when it comes to the lifecycle of a business!
Many businesses, especially large corporations have it in their mindset that they want to sell, sell, sell. However, Patagonia approaches this differently when it comes to their products. Advising their customers to only purchase as needed. Check out the video below to get a little further of a glimpse into their mindset.
Unfortunately, some corporations might not be looking to break the mold on becoming greener, but want to participate in the movement in their own way. Check out the list below to see four easy starting points to get the ball rolling!