In the past it has been common for people to
dismiss corporate social responsibility as a fad with no substance behind it –
a form of "hypocritical window-dressing,” as the esteemed economist Milton
Friedman referred to it in a 1970
article in The New York Times.
Friedman might have a Nobel Prize to his name, but
more and more companies are now beginning to see the importance of corporate
social responsibility. Over the last few decades, corporate social
responsibility has developed into something that all businesses need to pay
attention to, and is essential from an ethical standpoint. Businesses can have
big impact on the wider community, and have a duty to behave in a way that
accounts for this.
But corporate social responsibility is also an
opportunity. A study by researchers at Harvard Business School has demonstrated
that invest in environmental, social and governance issues experience improved
stock market performance and profitability further down the line. In other words, corporate social responsibility is profitable as well
How? Here, we explore this by looking at some of
the ways in which corporate social responsibility can benefit businesses.
Corporate Social Responsibility is Cost-Effective
Put simply, many corporate social responsibility
initiatives – particularly those aimed at promoting environmental
sustainability – are also massive cost-savers. According to figures published
by the World Wildlife Fund (WWF) and CDP (formerly the Carbon Disclosure
Project) in The 3% Solution, investing in green interventions
can lead to returns of 233%.
Whether it’s cutting waste, using less paper, or
reducing your company’s energy and water bills by investing in greener
technologies or promoting greener behaviours, the bottom line is that all of
these practices will save your business money – while also benefiting the
even small changes can lead to big savings. A supplier rationalisation within
the OCS Catering business has led to a saving in miles travelled to deliver
food to OCS catering contracts. Over the course of the year 2014/5 this saving
was calculated as being well over 500,000 miles. At OCS, we regularly deliver
significant cost savings to our clients by making their businesses more
Social Responsibility Builds Consumer Confidence
major way in which corporate social responsibility pays is that it builds
public confidence in your business. Customers are increasingly on the lookout
for an ethical purchase and, according to one survey, 77% of consumers feel it is
important for companies to be socially responsible.
more, customers are also increasingly educated about the impact that different
companies are having on the wider world. This is especially true in the digital
age, when almost all information is available at the touch of a button and news
spreads online like wildfire thanks to the power of social media.
PR value of having a comprehensive corporate social responsibility policy is
clear. Consumers are more likely to trust a business that they perceive as
behaving ethically, and are more likely to engage with that company. According
to YouGov statistics, 7 out of 10 Brits
say they like shopping with companies who ‘visibly give something back to
Social Responsibility Boosts Employee Morale
motivated employee is a productive employee – and creating a better world is
something that most employees feel passionately about. According to one survey,nearly half of Brits want jobs
that have a positive impact on the world.
want opportunities to do something positive in their job, and a strong
corporate social responsibility policy can help them achieve this. From giving
employees paid time off to volunteer, to organising a series of fun internal charity
fundraising events, employees are more likely to feel happy in their job, and
their company in general, when it’s allowing them to do good.
addition, a clear corporate social responsibility strategy is a good tool for
attracting new talent. This is particularly true among the younger generation,
with 62% of British millennials
claiming that they want to work for a company that changes the world for the
If you want your business to keep pace with the times, this is not an area it
pays to neglect.
trust that it’s now clear why investing in corporate social responsibility is
profitable for business, as well as positive for the world.
If you’d like to learn more about the business benefits of
sustainability, download our free eBook The
‘Convenient’ Truth About Sustainable Business: Why it Pays to Be Green. It offers a concise, easy-to-read summary of the environmental and financial benefits of reducing your
company’s carbon footprint, and outlines several different ways in which this
can be achieved – from reducing waste to improving energy efficiency.