Corporate Social Responsibility is about building and implementing strategies which involves our planet, its people, and business profits together to achieve sustainable growth. It is not that without CSR a company cannot exist but it is just that with well strategized and well-implemented CSR program a company can flourish.
Corporate Social Responsibility is a century old concept in our corporate world. Business houses, entrepreneurs, and corporations have practiced philanthropy voluntarily for a long time and they took CSR as a charitable purpose only to establish a good image for their brands.
The principal and morality of giving were quite interesting in the past. At that time donors believed in keeping themselves detached from the donation and were motivated to build up close sentimental attachments to his beneficiaries. However, at present, the philanthropic insight has changed where the donor remains attached to his donation and monitors to keep track of the process his donation is being used to support noble causes seeking satisfaction from its outcome.
Some CEOs are supporting CSR initiatives and they believe it should be incorporated with the business strategy and plans of the company to make sustainable growth and reap long-term profits. However, others are reluctant to make CSR a mandatory practice for the company. Whether to make CSR a mandatory practice in business has become a matter of conscience versus practical action, emotion versus logical decision and investment versus profit calculation.
CSR initiatives should be directed to national issues in an effective way so that it can address social imbalances. Companies can make CSR investments based on social, environmental and financial goals. Companies can hugely benefit the education, healthcare, environment, women’s welfare, energy and water conservation areas which need our immediate attention to alleviate the serious issues.
Many companies have already moved forward to integrate CSR in business models. Starbucks, a renowned USA based coffee company is focusing to alleviate the rising unemployment crisis in the USA through the ‘Jobs for USA’ program. It is using its power to bring a positive change in the society and scale for the public good as it has more than 12, 000 stores across the country.
CSR is actually moving from an optional programme to a mandatory one as we can see some countries have embraced CSR in the recent years and now standing out in CSR regulations. Denmark was the first country to mandate CSR information in companies’ annual financial reports.
Indonesia has taken a global leadership role in the implementation of CSR regulations in the country by passing a law requiring all public companies to issue CSR reports. The corporate world was taken aback with a big surprise when the Securities Exchange Commission of USA asked all public companies to disclose climate-related risks in their annual reports.
Incorporating CSR programmes will set a win-win situation for all where corporate actions to generate profit will be tied to a higher purpose and goals. Today, we live in a global society which is moving through a crucial period vexed by unemployment, income inequality, global warming, gender inequality, war and political challenges which will affect and hamper the companies’ growth at some point of time in the future. So CSR is actually a smart long-term business move to show a duty-bound and holistic commitment for public good.
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In 2016, HuffPost reported that 64% of CEO’s around the world are investing in corporate social responsibility because their first and foremost priority is about building trust with consumers, partners, shareholders employees and the government.CSR is becoming important day by day because public trust in business and corporations are declining rapidly which may hamper the brands’ credibility and impede the financial growth of the company.
Li Huaizhen, president of China Minsheng Investment Corp. had explained it best:
“Once you have done your bit- fulfilled your social responsibilities and formed a community with shared interests with local people, they will welcome your projects and provide huge support. So a company’s own interest and the social value it provides are closely connected. In fact, this is also a kind of investment, and it always brings returns.”
Business houses, corporations, entrepreneurs, and companies cannot treat CSR as an optional element to their business methods. They now need to see it as a mandatory business practice that highly drives the business performance by attracting new talents and customers while retaining existing ones.
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