Corporate Social Responsibility (CSR) – a big phrase that holds great meaning and significance in today’s day and age. In recent years, the importance of CSR, i.e, Corporate Social Responsibility has grown in leaps and bounds. Most of us have come across this phrase or one has heard of corporate donations to charity at some point. So, what is Corporate Social Responsibility?
At the core of the concept of CSR lies the idea that those who flourish and prosper in the arms of the society, must also give back to it in one way or another. CSR looks beyond the profit-making goals and initiatives of a company and lays emphasis on the overall impact the company has and is capable of making on the society at large. It is the dedication of the company to function in a way that is sensitive towards and beneficial to the society.
Corporate Social Responsibility may manifest in a number of ways-
- Sustainability or environment friendly practices such as working towards depleting their carbon footprint, cleanliness drives in several areas, reducing manufacturing waste
- Engaging in socially responsible and woke behaviour such as emphasis on inclusion, diversity, focus on the wellbeing of employees, community engagement.
- Philanthropic activities such as corporate donations to nonprofits, supporting a cause, support a charity or program, collaborate or partner with an organisation support a specific cause.
Why is Corporate Social Responsibility important?
CSR is important for the company and also has a large-scale impact on society.
Following points are written keeping company’s perspective in mind.
Helps improve brand image
Acts of philanthropy that benefit the society in one way or another reflect well on the company’s image. It shows that they care about the society and are responsible members of the community. It humanises the company or brand, which highly works in their favour, especially in a world where consumers are getting increasingly sensitive towards the way companies’ function.
In today’s world, where issues such as sustainability and equitable access to resources pose significant challenges, it is beneficial for a corporation to be perceived as one that cares about larger social issues.
Provides an edge over competitors
In a highly competitive market, all brands and companies seek to set themselves apart from their competitors. Acts of compassion that may be conducted as part of CSR often helps provide that edge. The image of a corporate in terms of it’s responsibility towards society can be a big differentiating factor from its competitors in a world where all companies seem to be running behind profits.
Today’s customers are woke and prefer brands that strike a certain chord with them. They like to be associated with brands that are contributing towards society. It enhances their sense of social responsibility as well.
Increased brand awareness
Brands often come to be known for their acts of philanthropy. This helps increase brand awareness and recognition which eventually helps beget increased sales. Many brands have aligned themselves to a certain cause that resonates with their overall corporate voice and have been providing corporate donations to non-profits they support.
From Society’s Perspective
CSR plays an important role in bringing about change that has a large impact. Many charities are working to make a difference in multiple areas such as children’s health, sanitation, access to clean drinking water, education, maternal health, sustainability and so on and so forth. These charities need funds to be able to plan and execute programmes that can help them achieve impact on a large scale.
Corporate donations to charity usually involve large funds that are available over a period of time for charities. Hence these charities are able to plan for programmes that can run for longer time periods. Access to a larger pool of resources that what they would get from individual donations, enables these charities to execute the programmes on scale and, hence creating a larger impact. This also enables the charities to hire professionals who can work efficiently to drive focussed results.
Hence CSR is a great concept that strikes a balance between companies operating only to chase profits and at the same time work for the larger good of society. As mentioned in the beginning of this article, in a world where there is an increased need for more consciousness, more equitable access to opportunities, CSR plays an integral role.