Has Corporate Social Responsibility Become an Essential Pillar of Business?

Corporate social responsibility (CSR) – aka corporate conscience or corporate citizenship – is essentially the idea that businesses and corporations have a responsibility as members of society to ensure compliance with laws, ethical standards, and cultural norms and should actively seek out opportunities to impact change in the world around them.

CSR initiatives can help bolster a company’s public image. Making corporate social responsibility an essential business pillar has become almost standard practice, and with good reason. Consumers will support and promote a company they respect and believe to be making a positive impact.

And while there are many benefits beyond making a positive impact on the world for companies who embrace their corporate social responsibility, it can often be a delicate balancing act between sincerity and PR stunt.

A Thin Line to Walk

When done correctly, CSR strategies are honest and mutually beneficial for the company and their cause. However, there are less scrupulous companies who have no problem feigning social responsibility to boost the bottom line.

For example, “greenwashing” is the term given to the practice of deceptively promoting environmentally friendly business practices or products when in reality more effort is put into promoting the company as “green” than producing actual “green” benefits.

It’s vitally important for those companies that are striving in earnest to make a difference, to clearly and effectively communicate their intentions. And while there will always be skeptics who will question a business’ true motivation for engaging corporate social responsibility strategies, it’s actually quite surprising – and encouraging – to learn just how serious many “mega-corporations” take their role in building a better world.

Who’s Doing It Right?

One of the most recent and clear-cut examples of corporate social responsibility is drug store giant CVS Caremark discontinuing sales of tobacco products at its more than 7,600 stores. It’s a move that CVS estimates will cost the company approximately $2 billion in lost revenue annually, but as CVS president and CEO Larry J. Merlo, puts it:

“Ending the sale of cigarettes and tobacco products at CVS is the right thing for us to do for our customers and our company to help people on their path to better health. Put simply, the sale of tobacco products is inconsistent with our purpose.”

The move to end tobacco sales, while definitely risky for CVS, has been widely praised and has only helped to raise awareness of the company’s commitment to integrity and their purpose. It will be interesting to watch in the coming years if this is the beginning of a trend. If a company like CVS is willing to take a $2 billion hit, will others be more willing to follow suit?

Google has also made quite a name for itself through its corporate social responsibility initiatives and is just another example of a massive corporation using its considerable resources to make an impact on the world.

According to a recent Forbes article on companies that consistently rank the highest in corporate social responsibility, “In the past three years, Google has donated over $353 million in grants worldwide, approximately $3 billion in free ads, apps, and products, and Googlers have volunteered approximately 6,200 total days of employee time to support nonprofits (a total of 150,000 hours).”

Whole Foods Market is another company that consistently receives high marks for its corporate social responsibility. In fact, John Mackey, the company’s co-founder and co-CEO, has developed the concept of “conscious capitalism.” According to the “Conscious Capitalist Credo,”

“Conscious Capitalism is a way of thinking about capitalism and business that better reflects where we are in the human journey, the state of our world today, and the innate potential of business to make a positive impact on the world.” 

Mackey co-founded the Conscious Capitalism Movement to challenge business leaders to rethink why their organizations exist, and to acknowledge their roles in the global marketplace. In his book “Conscious Capitalism, Liberating the Heroic Spirit of Business,” Mackey lays out his case for re-imagining capitalism and the responsibility businesses bear to ensure their practices are grounded in ethical consciousness.

CSR Isn’t Just for Big Corporations

On a smaller scale, there is a trend of many companies basing the core of their business model on the concept of corporate social responsibility. Two of the more well-known examples include Tom’s and Warby Parker.

Tom’s truly touched a nerve in their customer base with their “One for One” concept, which in a nutshell, means that for every pair of shoes the company sells, they donate a pair to someone in need in countries around the world. Warby Parker employs a similar concept for its eyewear.

An Important Role to Play

Corporate social responsibility is a powerful business strategy with the potential to significantly impact the world we live in. And while, there definitely are financial, marketing, and PR benefits for companies that actively engage in socially responsible activities, it’s still an important role that businesses can play. And, hopefully, a trend that will continue to spread.

What role do you believe businesses should play in their communities? How does your company engage in corporate social responsibility? Let us know in the comments section below.


No comments yet.

Leave a Reply