Benefits of Corporate Social Responsibility in a Company

For a company, it is no longer enough to generate profits, financial results, and launch products and services capable of gaining public and customer approval. Today, organizations must be part of a community and have a social purpose. This translates into the concept of Corporate Social Responsibility (CSR), which has become an essential component for business development and success. So, let's take a closer look at what corporate social responsibility is.

What is CSR?

The concept of Corporate Social Responsibility (CSR) was first defined in 1953 by the American economist Howard Rothmann Bowen. According to Bowen, corporate social responsibility consists of the duty of business leaders to implement policies and make decisions that are desirable not only in terms of economic goals and values but also aligned with the context in which the company operates.

The European Community, to explain what corporate social responsibility is, writes: "the voluntary integration by companies of social and environmental concerns into their business operations and in their interactions with stakeholders." Essentially, corporate social responsibility is a set of practices, behaviors, and policies implemented by a company with the goal of having a positive impact on the community.

Types of Corporate Social Responsibility

CSR activities can affect various areas, including the environment, equity, cultural heritage, education, health, energy savings, advertising information, and human rights. Depending on the issues addressed, different types of corporate social responsibility can be distinguished:

• Environmental Responsibility: includes initiatives aimed at reducing the environmental impact of company activities through sustainable practices, such as reducing carbon emissions, recycling, energy efficiency, and conserving natural resources.   
• Human Rights Responsibility: involves adopting policies and practices aimed at promoting and protecting human rights within the company and throughout the supply chain. This includes eliminating child labor exploitation, promoting diversity and inclusion, and respecting workers’ rights.   
• Philanthropy: refers to charitable activities and community support. Companies can invest in training, education, health, and welfare programs, and contribute financially to non-profit organizations and social projects.   
• Financial Responsibility: focuses on the responsible and sustainable financial management of the company. This involves adopting ethical practices, transparency in reporting, commitment to waste reduction, and responsible use of resources.

Socially responsible behavior must also be reflected in people management. Companies should pay attention to workers’ rights, workplace safety, employee well-being, gender equality, and inclusion, creating a positive and welcoming environment. Additionally, it involves engaging stakeholders, that is, building mutually beneficial relationships based on trust, transparency, and continuity.

The Importance of Corporate Social Responsibility in Companies

Globally, 9 out of 10 citizens want to live in a more sustainable and equitable world. According to Randstad Employer Brand Research, a company's commitment to giving back to society is one of the main sources of employer attractiveness. In fact, more than a third of workers, especially younger generations, would not accept a job at a company whose values they do not share. Therefore, business strategies are increasingly oriented towards sustainability goals (ESG - Environmental, Social, and Corporate Governance).

In 2017, according to a KPMG survey, 75% of multinational companies already prepared a corporate social responsibility report, while today the percentage reaches 80%. This is because numerous studies have highlighted the close relationship between CSR and companies' financial performance: 

"Consider companies listed on the stock exchange and investors or funds that are increasingly guided by ethical considerations when financing projects."

Examples of Companies Successful in Corporate Social Responsibility

There are numerous companies that provide examples of corporate social responsibility. Google Green is a project that allowed the company to reduce the energy costs of its data centers by 50%. Google has also invested around one billion dollars in renewable energy projects, opting to reuse this production in other sectors of its business. Coca-Cola launched the 5by20 program, aiming to support women worldwide by providing training opportunities and support to start businesses. 

Starbucks is committed to supporting the local communities from which it sources coffee raw materials, through the implementation of education programs, gender equality, minority rights, water resource conservation, and waste reduction. The C.A.F.E. (Coffee and Farmer Equity) program is a concrete example of CSR activities promoted. Additionally, Starbucks has partnered with Ethos Water to provide access to clean water to over one billion people in need. 

Advantages of Corporate Social Responsibility in a Company

Although voluntary, corporate social responsibility has become indispensable, as people are increasingly attentive to sustainability and the economic and social impact of corporate actions. A strong commitment to social responsibility not only enhances a company’s reputation but also strengthens its brand, benefiting employees through improved talent acquisition and retention, and customers through greater loyalty and increased likelihood of purchase.

We can summarize the advantages of corporate social responsibility as follows: 

• enhances reputation and corporate image 
• customer loyalty 
• attraction and retention of talent 
• innovation and differentiation 
• reduction of reputational, legal, and ethical risks. 

The Role of the CSR Manager 

Today, there is a professional role dedicated to corporate social responsibility: the CSR manager. To train in this field, one can opt for a Global Master’s in Sustainability and CSR. The CSR manager plays a transversal role within the company, communicating with all areas of the organization to achieve sustainability and social responsibility objectives. 

First, they define these objectives and develop concrete strategies and action plans to achieve them. Then, they effectively communicate these plans to the various departments of the company, which collaborate to achieve the common purpose and feel involved in the values promoted by the company. The task of the CSR manager also includes monitoring the impact of the policies implemented, preparing reports and statements on the results obtained, critical aspects, and areas for improvement.