“Finite games, like football or chess, have fixed rules, the players are known, and the winners and losers are easily identified. In infinite games, like business, the players come and go, the rules are changeable, and there is no defined endpoint. There are no winners or losers in an infinite game; there is only ahead and behind.”– Simon Sinek
Properly defined Corporate Social Responsibility (CSR) is a business self-regulation activity that aims to contribute to societal goals of a philanthropic, activist, or charitable nature by engaging in or supporting volunteering or ethically-oriented practices.
Simply defined, it’s about your business giving back to society.
Often cited as the “father of CSR”, Howard Bowen, an American economist and Grinnell College president, connected the responsibility of corporations to society and published a book in 1953 (Social Responsibilities of the Businessman).
When CSR started in the US in the late 1800s, it was rooted in corporate philanthropy but it wasn’t until 1970 that it truly took hold when the concept of the “social contract” between business and society was declared by the Committee for Economic Development in 1971.
Today, it’s a requirement and an avenue to show consumers that you walk the talk but its importance has been warped. No longer about really making a change in communities but an avenue for greenwashing with little regard for the impact they’re making and often with no measurable results.
Despite good intentions, most businesses don’t know how to be effective in creating a positive impact through their CSR initiatives and it leads to wasted resources and a general feeling of apathy from consumers who see these efforts as being insincere or inauthentic.
In a Forbes article, they summarised that consumers today have an eagle eye trained on their favourite brands and the promises that they keep, especially on the ones they don’t.
Without really needing to delve into much research, take some time to reflect:
- How do you feel about the brands that offered aid during COVID-19 honestly with no condition?
- How do you feel about brands that didn’t care for the welfare of their employees?
- From the many initiatives that businesses start, how many have shared the results?
- How many businesses have used CSR as clout generators with the most important factor of sincerity missing?
We believe that there still is and always has been a way to make real change and it’s through the Impact-Driven Model that marries profit and purpose.
In the past few years, value priorities have drastically shifted from the usual environmental, inclusivity and diversity efforts into more people-centric values like employee support, and racial and even political standing. The intriguing thing is, they will continue to shift with world affairs so whether you’re focused on social impact or environmentalism, people will always want to work and support a company with a cause.
There are three ways businesses can be more effective in creating a bigger impact: by focusing on solutions, engaging employees, and collaborating with others.
Focusing on Solutions
Focusing on solutions means targeting the root causes of problems instead of just addressing the symptoms. Addressing the symptoms of a problem can be helpful in the short term, but it doesn’t solve the underlying issue. For example, providing food or water to people who are starving or homeless may help them in the short term, but until you address the reasons why they’re starving or homeless, the problem will continue. Focusing on solutions means looking at the root causes of problems and working to fix them. This can be more difficult and take longer, but it’s the only way to create real change.
The most obvious would be for a business to create new products or services that address its customer’s current pain points.
In Ireland, a budget supermarket Lidl offered its customers the chance to find a quieter time to shop, through its new online chatbot.
“Just send a message with the day and time you intend to visit and it’ll instantly let you know whether that’s a Quieter/Average/Busier time to visit. We’ve analysed our shopper behaviour over the past couple of weeks to find the quietest time to head into the store.”
An international vending solutions brand, Selecta, created “Safety Stations” placed in Zurich Airport in Switzerland and Brussels train station in Belgium that would provide commuters with the pandemic essentials.
“As our economy is slowly restarting, it is important to us that we’re able to respond to our customers’ changing needs. These products and services enable us to do that” said Managing Director of Selecta Belgium, Tim Goossens
These are brilliant examples of innovation and while they’re not necessarily CSR initiatives, they show us that these businesses care.
In the more traditional CSR pathways, businesses can also adopt more sustainable practices that reduce their negative impact on the environment.
A trusted global brand Google is known for its environmental initiative and powerful CEO, Sundar Pichai. They earned the Reputation Institute’s highest CSR 2018 score much in part due to their data centres using 50% less energy than others in the world. They have also committed over $1 billion to renewable energy projects and enable other businesses to reduce their environmental impact through services such as Gmail.
But what happens when an initiative begins creating more damage than harm?
TOMS had a mission to donate a pair of shoes for every one sold to children in need, and using those profits they assisted in a number of other equally impactful causes. They soon came under criticism from NGOs for creating a dependency on free shoes, collapsing the local market.
Here’s how they pivoted:
“We learned that giving shoes, sight, and safe water for over a decade was an amazing start— the right start — to creating meaningful change. But, the decision to give impact grants instead will enable our community to do even more. Rather than giving shoes, we’re giving 1⁄3 of our profits. In other words, $1 for every $3 we make, which is about as much as a company can give while still keeping the lights on.” - TOMS Impact Report 2019-2020.
Employees are the backbone of any company, and engaging them in CSR initiatives is a great way to get them involved and make a difference. By giving them opportunities to participate, employees feel more connected to the company and its goals helping foster a more positive work environment and creating a culture of ownership, purposeful work and pride (not the bad kind).
Socap Global outlined 6 ways that CSR benefits employees:
- Increased organisational citizenship behaviours and improved employee relationships
- Enhanced employee identification with the organisation
- Improved retention and organisational commitment
- More attractive company culture to prospective employees
- Better employee engagement and performance
- Increased creativity
“I’ve learned that people are motivated and more willing to go the extra mile to make the company successful when there’s a higher good associated with it. It’s no longer just a job. Work becomes meaningful and this makes us more competitive.” said Bob Stiller, founder of Green Mountain Coffee Roasters.
A leading European bank in Switzerland, BNP Paribas’s central pillars for its CSR strategy are employee engagement and solidarity. They provide up to 16 hours (or 2 working days) to use for volunteer initiatives.
They have now reached 40% employee participation and have solidified their position as a socially responsible player in the financial industry, all while integrating employee purpose and aspirations into their company’s fabric.
If you’re not sure where to start with this, here’s what Quantum Workplace, a human resource technology provider says:
- Find the right cause
- Designate employee volunteer days
- Respond to local events
- Host in-office volunteering opportunities
- Present skills-based micro-volunteering opportunities
- Match employee donations
- Share your story
Collaborating With others
It’s becoming more and more apparent that in order to create meaningful change, businesses need to team up with other businesses, NGOs, and governments. Through collaboration, you can come up with innovative solutions to some of the world’s biggest problems.
Unilever, parent company to household brands like Dove, Lifebuoy, Lipton and more, through its TRANSFORM Initiative (a joint venture with the UK’s Foreign, Commonwealth & Development Office and EY) offers funding and bespoke business support to social enterprises that deliver market-based solutions to pressing development challenges.
TRANSFORM has supported 56 projects and enterprises across 13 countries in Water, Sanitation, and Hygiene; Health and Well-being; Energy and Environment; Rural Livelihoods; and now COVID-19.
In 2021, they launched their “Partner Promises” program to engage its suppliers in addressing social inequity; remedying living wage gaps; and measuring, reducing, and reporting on climate emissions in their shared value chains.
Microsoft, through their “Global Social Entrepreneurship Program” in collaboration with MIT Solve, is engaging with over 100 global social impact organisations, working across the UN Sustainable Development Goals.
The program connects startups with access to technology, training, new markets and customers, and grants funding. They are specifically seeking social innovators who have identified new ways to apply artificial intelligence for social change.
You have the opportunity to make a big difference in the world. Start.