Corporate Social Responsibility need not be a philanthropic option

Monday, 5 November 2012 11:42 - - {{hitsCtrl.values.hits}}

A common thought on Corporate Social Responsibility (CSR) as conducted by companies is how the company manages its business not only to pursue its financial goals but also goals that have an overall positive impact on society.

Companies committed to CSR feel that it is an obligation, not one imposed by law, but one where a corporate is ready and willing to be a good citizen to the community and serve the wider community taking note of societal priorities and expectations of the time.

When most people think of CSR, they imagine corporate philanthropy connected to large issues such as the environment and poverty alleviation. Looking at the current trend, CSR is not an option but a must. CSR had always been around though not by name. Wealthy businessmen of the past had contributed immensely to society in genuine, concrete ways that stood the test of time for generations after them. Therefore it is safe to assume that it would always prevail, especially now that it has been taken to corporate level.

An unseen but critical factor though, is finance. Finance has an important role to play in advancing CSR and sustainability goals as it looks at risk management and good governance. Without these two factors in place and specific policies on how the business works as a whole, CSR cannot be successful.

Corporate are increasingly becoming CSR oriented, although some of those efforts and interventions are still not long term result oriented. Some CSR efforts may be a PR exercise; some could be image boosters whilst some could even be an effort to ease guilt!

Companies may wish to conceal the effects of their business if it had harmful effects on society – e.g. chemical manufacturers who may have to necessarily pollute some part of the environment with their residues. There could even be large companies that deflect income into CSR initiatives to enhance the image of their portfolios even though it may divert what could otherwise be paid to shareholders. Some, for example managers who do not own the firms they work for, may support good causes not out of their own generous salaries but as part of the day’s work.

CSR initiatives that genuinely take care of society in a responsible manner are wholly admirable. Whilst large companies are easily able to conduct meaningful CSR activities, small companies seriously interested in promoting wholesome CSR activity but not to the scale of rescuing the rain forest may consider a solution such as allocating at least 1% of their profits and 1% of their employees paid hours for philanthropy with workers volunteering their time either to company run schemes or their own charitable initiatives, as being involved in socially responsible activities also brings about emotional growth and inner personal satisfaction.

Simple CSR approaches would be caring for staff and families – welfare projects for staff including staff qualifications and training, social activities benefitting the local community such as environmental, charitable donations or sponsored events or partnerships with government and non-governmental organisations. Thus even small firms can build long lasting, beneficial relationships with a chosen CSR project that ensures your business has a positive impact on people and the environment, wherever it operates.