Every business has to depend on society’s resources and deal with the communities for its growth. CSR is a concept that upholds and looks after the interests of both businesses and societies. CSR programs address the three major corporate wings: customers, society, and employees. Importance of Corporate Social Responsibility (CSR) in the Present.
”Every Business has a reason for existing, but it’s never money.”
-Jim Cathcart (Entrepreneur and Author)
CSR policies attract customers, motivate employees and then retain them both for long-term growth and success of the company. CSR is an innovative factor of business or we may call it the spark of the business that revolves around aggressive concepts and theories which help the business to progress in the corporate world by benefitting the social, economic, educational, and ecological domains of the country.
Importance of CSR
Technology has made our life easier and we are enjoying the countless boons of the modern world. While on the other hand, there are still some parts of the world that are underdeveloped or going through humanitarian crises that we don’t even know about.
The World Bank has reported that the number of poor has increased by 2.5 million (from 766.0 to 768.5 million) and the global population considered to be extremely poor remains unchanged at 10.7%. UIS Data suggests, about 263 million children and youth were out of school, for the school year in 2016 and globally the number of school dropouts are increasing every day. The Global Nutrition Report 2017 showed that, despite the significant steps the world has taken towards improving nutrition, malnutrition among women and children is still a large-scale and universal problem that we are failing to address each year.
These were just a few facets of the global crises that we are witnessing at present. It is true that businesses cannot eliminate all the world’s problems alone but they can’t even dare to wink at these problems either. Businesses deal with society and its people so they have to be concerned about the local, national or international crises for the sake of their own growth. Again consumers are more conscious about political, economic, and environmental issues of the world at present so to keep them engaged with your brand there is no other alternative except becoming socially responsible.
CSR has proved to be the best way to build relationships with customers. Having a CSR policy can impact the buying decisions of consumers and make them loyal to your brand. There were some incidents where customers are willing to pay more than the usual price for a product when they were informed that a portion of the profit is going to a worthy cause. When corporations stand to support a charitable cause they are viewed positively by the community which in turn boosts their sales.
When CSR policy is incorporated with the company’s business model it attracts positive publicity, wins the trust and loyalty of the consumers, builds a long-term relationship with the customers and communities, improves the sales, and therefore, boosts the financial success.
Being a socially responsible company can help to motivate and encourage the employees because they will feel proud and happy to be associated with a bigger cause at work which is much more than gaining materialistic pleasures. CSR policies can empower employees to leverage the corporate resources at their disposal to do good to others. This will boost the employee morale because they will find a greater meaning in their work and the results can be amazing. Companies with CSR policies stand out from their competition because building good relationships with customers and their neighborhoods has helped them to build their unique brand image. Google and Microsoft can be considered as ideal companies that have integrated CSR policies and values and have spent billions of dollars each year for charitable causes.
Many people still view Google as the first ever socially responsible corporate citizen. Google has managed to build and retain its good image over the years only because of its aggressive moves to do greater good for both national and international communities. Google provides education services to schools.Google.org. works to provide grants to schools worldwide and tends to address the major world problems in education that need a helping hand.
Google is an environmentalist corporation as well which is aware of the global energy issues and its shortages. Google has made a corporate effort to use resources efficiently and support renewable power through the Google Green program. This practical approach to save energy was successful because the power requirements for Google data centers were seen to drop to an average of 50%. This surplus energy can then be redirected and used in other areas of the business.
Bill Gates is known to be the world’s one of the leading philanthropists who frequently makes it to the headlines due to his generous charitable efforts. Bill Gates through his Bill and Melinda Gates Foundation work in developing countries to improve people’s health and wellbeing. This Foundation has taken drastic steps over the past few years to eliminate hunger and extreme poverty in impoverished regions. They also work in partnership with other organizations to provide effective vaccines, drugs, and diagnostics to the neediest people.
CSR is the concept of work that goes beyond the typical corporation task, job, and profit perspective and provides an appropriate channel through which both the owners and their employees can seek and gain meaningfulness through work. Corporate social responsibility is actually an unsentimental but powerful business decision.
According to the Professor of Business Rosabeth Moss Kanter, Companies that are adopting CSR policies today are actually taking path-breaking steps which would definitely benefit them in the future. Kanter wrote in her review: “Companies that are breaking the mold are moving beyond corporate social responsibility to social innovation. These companies are the vanguard of the new paradigm. They view community needs as opportunities to develop ideas and demonstrate business technologies, to find and serve new markets, and to solve long-standing business problems.”
Practicing CSR policies can bring positive outcomes for organizations and external stakeholders. It is important for businesses to get involved in community-based CSR initiatives to brand their products or services in the communities and at the same time show their human face to the consumers.