Corporate social responsibility is a term that has come to mean whatever a company does to

give back to the community in which it has a presence. Sometimes this involves grants,
volunteerism or sponsorships. Other times, a company will choose to demonstrate its corporate
social responsibility by a commitment to clean energy or some other laudable effort or cause.

Features

There are several different ways that companies express their corporate social responsibility.
Wal-Mart, for example, has made a commitment to use 100 percent clean energy and to produce
zero waste. It has set benchmarks to reach this goal. By 2012, Wal-Mart plans to fuel a third of
its stores with clean energy. Already it supplies 15 percent of their Texas stores with wind
energy. Environmental and other socially vital commitments is usually among the promises that
responsible companies make to their communities.

Types

Boeing is another company that takes corporate citizenship seriously. The aviation company has
set aside a percentage of its revenue to be given to nonprofit organizations that work in
education, health and human services, arts and culture, civic life and the environment. According
to vice president of Boeing Global Corporate Citizenship, Anne Eleanor Roosevelt, the company
intends to "facilitate" community change and not just to "fund" it. Corporate social responsibility
is a core value at Boeing. Many companies have similar giving programs. Some have created
501(c)(3) foundations to give away a minimum of 5 percent of the foundation's assets each year
to nonprofits that share their priorities.

Function

Likewise, Goldman Sachs expresses its commitment to corporate social responsibility by making
grants to nonprofit organizations. The financial institution is especially interested in programs
that increase the earning potential of women and that improve education for emerging leaders. In
addition, this company is committed to sharing its expertise with nonprofit organizations. It pays
its employees to work a day at a nonprofit organization. It also provides fellowships that pay for
its best performers to spend a year on loan to nonprofit organizations which will benefit from
their knowledge and experience. Volunteerism is a growing way that many corporations are
using to show that they care about the less fortunate members of local communities.

Expert Insight

To learn how a corporation expresses its corporate social responsibility, go to its main website.
There, look for links to one of the following phrases: "corporate social responsibility," "corporate
citizenship," "our community," "giving back," "grants," "sponsorships" or some variation on
these words. If there is no link at the top, check the small print at the bottom of the home page.
When nothing like this is evident, click on "About Us." There may be another set of links
embedded in this area of the website.
What is Corporate Social Responsibility (CSR)

Corporate social responsibility (CSR) is a self-regulating business model that helps a company
be socially accountable — to itself, its stakeholders, and the public. By practicing corporate
social responsibility, also called corporate citizenship,.

Breaking Down Corporate Social Responsibility (CSR)

Corporate social responsibility is a broad concept that can take many forms depending on the
company and industry. Through CSR programs, philanthropy, and volunteer efforts,
businesses can benefit society while boosting their own brands. As important as CSR is for the
community, it is equally valuable for a company. CSR activities can help forge a stronger
bond between employee and corporation; they can boost morale and can help both employees
and employers feel more connected with the world around them.

In order for a company to be socially responsible, it first needs to be responsible to itself and
its shareholders. Often, companies that adopt CSR programs have grown their business to the
point where they can give back to society. Thus, CSR is primarily a strategy of large
corporations. Also, the more visible and successful a corporation is, the more responsibility it
has to set  standards of ethical behavior for its peers, competition, and industry.

CSR in Action — Starbucks

Long before its initial public offering (IPO) in 1992, Starbucks was known for its keen sense of
corporate social responsibility, and commitment to sustainability and community welfare.
Starbucks has achieved CSR milestones such as reaching 99 percent ethically sourced coffee;
creating a global network of farmers; pioneering green building throughout its stores;
contributing millions of hours of community service; and creating a groundbreaking college
program for its partner/employees. Going forward, Starbucks’ goals include hiring 10,000
refugees across 75 countries; reducing the environmental impact of its cups; and engaging its
employees in environmental leadership.
Published Standards for CSR

In 2010, the International Organization for Standardization (ISO) released a set of voluntary
standards meant to help companies implement corporate social responsibility. Unlike other
ISO standards, ISO 26000 provides guidance rather than requirements because the nature of
CSR is more qualitative than quantitative, and its standards cannot be certified. Instead, ISO
26000 clarifies what social responsibility is and helps organizations translate CSR principles
into effective actions. The standard is aimed at all types of organizations regardless of their
activity, size, or location. And, because many key stakeholders from around the world
contributed to developing ISO 26000, this standard represents an international consensus.

What is Corporate Social Responsibility?

Consumers consider more than quality goods and services when choosing a brand. Many are
prioritizing corporate social responsibility (CSR), and holding corporations accountable for
effecting social change with their business beliefs, practices and profits. In fact, some will
even turn their back on their favorite companies if they believe they're not taking a stand for
societal and environmental issues.

"Corporate responsibility is simply a way for companies to take responsibility for the social
and environmental impacts of their business operations," said Jen Boynton, vice president of
member engagement at 3BL Media. "A robust CSR program is an opportunity for companies
to demonstrate their good corporate citizenship … and protect the company from outsized risk
by looking at the whole social and environmental sphere that surrounds the company."

To illustrate how critical CSR has become, a 2017 study by Cone Communications found that
more than 60 percent of Americans hope businesses will drive social and environmental
change in the absence of government regulation. Most consumers surveyed (87 percent) said
they would purchase a product because a company supported an issue they care about. More
importantly, a whopping 76 percent will refuse to buy from a company if they learn it supports
an issue contrary to their own beliefs.

"CSR creates a filter for the actions of a company," said Wendy Burk, CEO of Cadence
Travel. "It keeps organizations accountable and ethical."

But consumers aren't the only ones who are drawn to businesses that give back. Susan
Cooney, head of global diversity, equity and inclusion at  Symantec, said that a company's
CSR strategy is a big factor in where today's top talent chooses to work.

"The next generation of employees is seeking out employers that are focused on the triple
bottom line: people, planet and revenue," said Cooney. "Coming out of the recession,
corporate revenue has been getting stronger. Companies are encouraged to put that increased
profit into programs that give back."

Ways to practice CSR

Recognizing how important social responsibility is to their customers, many companies now
focus on and practice a few broad categories of CSR:

1. Environmental efforts: One primary focus of corporate social responsibility is the

environment. Businesses regardless of size have a large carbon footprint. Any steps they can
take to reduce those footprints are considered both good for the company and society.

2. Philanthropy: Businesses can also practice social responsibility by donating money,

products or services to social causes. Larger companies tend to have a lot of resources that
can benefit charities and local community programs.

3. Ethical labor practices:  By treating employees fairly and ethically, companies can also
demonstrate their corporate social responsibility. This is especially true of businesses that
operate in international locations with labor laws that differ from those in the United States.

4. Volunteering: Attending volunteer events says a lot about a company's sincerity. By doing

good deeds without expecting anything in return, companies can express their concern for
specific issues and support for certain organizations.

Building a socially responsible business

Undertaking socially responsible initiatives is truly a win-win situation. Not only will your
company appeal to socially conscious consumers and employees, but you'll also make a real
difference in the world.

Cooney stated that in CSR, transparency and honesty about what you're doing are paramount
to earning the public's trust.

"If decisions [about social responsibility] are made behind closed doors, people will wonder if
there are strings attached, and if the donations are really going where they say," Cooney said.
"Engage your employees [and consumers] in giving back. Let them feel like they have a
voice."

For instance, Burk added, Cadence gives $100 each year to the charity of choice for each
employee.

"Start integrating your ethos into your culture," Burk said. "Even if you don't have a huge
cause to focus on as an organization, you can always start with what is important to your
employees."

You should also involve your consumers, allowing them to see firsthand the work you are
doing for your community.

"If a brand has good news to share, like organic ingredients or recycled content, they should
let consumers know," said Boynton. "Consumers deserve to share in the good feelings
associated with doing the right thing and many surveys have found that consumers are
inclined to purchase a sustainable product over a conventional alternative. Announcing these
benefits is a win-win from both a commercial and sustainability perspective."

Maintenance is another major part of CSR. You must actively and consistently work on your
process; it's not a one-time deal.

"To keep your CSR efforts thriving, you need momentum and passion, and that have to come
from the top," said Burk. "Your stakeholders need to be fully committed. Focus on
responsibilities that are meaningful and relevant to you, your clients, your employees, and
your partners."

For some great examples of small businesses that put CSR at the heart of their operations,
check out this Business News Daily article.

Additional reporting by Nicole Fallon. Some source interviews were conducted for a previous
version of this article.

How Corporations Benefit from Corporate Social Responsibility

1. Improves Public Image

Companies that demonstrate their commitment to various causes are perceived as more
philanthropic than companies whose corporate social responsibility endeavors are nonexistent.

A corporation’s public image is at the mercy of its social responsibility programs and how
aware consumers are of these programs.

Remember, consumers feel good shopping at institutions that help the community. Clean up your
public image (and broadcast it to the world!).

Corporations can improve their public image by supporting nonprofits through monetary
donations, volunteerism, in-kind donations of products and services, and strong
partnerships.

By publicizing their efforts and letting the general public know about their philanthropy,
companies increase their chances of becoming favorable in the eyes of consumers.

Takeaway: Positive social responsibility improves a company’s public image and

relationship with consumers.

Check out the ultimate guide to corporate philanthropy

2. Increases Media Coverage

It doesn’t matter how much your company is doing to save the environment if nobody knows
about it.
Make sure you’re forming relationships with local media outlets so they’ll be more likely to
cover the stories you offer them.

How much good a company can do in its local communities, or even beyond that, is corporate
social responsibility. And the better the benefits, the better the media coverage.

On the other hand, if a corporation participates in production or activities that bring upon
negative community impacts, the media will also pick this up. Unfortunately, bad news
spreads quicker than good news.

Media visibility is only so useful in that it sheds a positive light on your organization.

Takeaway: Having a strong CSR program can increase the chances that your company
gets news coverage.

3. Boosts Employee Engagement

Employees like working for a company that has a good public image and is constantly in the
media for positive reasons.

Happy employees almost always equal better output.

Nearly 60% of employees who are proud of their company’s social responsibility are engaged at
their jobs.

When companies show that they are dedicated to improving their communities through
corporate giving programs (like matching gifts and volunteer grants!), they are more likely
to attract and retain valuable, hardworking, and engaged employees.

If a corporation is philanthropically minded, job-hunting individuals are more likely to apply and
interview for available positions. Once hired, employees who are engaged will stay with a
company longer, be more productive on a daily basis, and will be more creative than disengaged
workers.

Takeaway: Corporate social responsibility helps attract and retain engaged and productive
employees.

Discover the importance of increasing employee engagement

4. Attracts & Retains Investors

Investors who are pouring money into companies want to know that their funds are being used
properly.

Not only does this mean that corporations must have sound business plans and budgets, but it
also means that they should have a strong sense of corporate social responsibility.
When companies donate money to nonprofit organizations and encourage their employees
to volunteer their time, they demonstrate to investors that they don’t just care about
profits.

Instead, they show that they have an interest in the local and global community.

Investors are more likely to be attracted to and continue to support companies that demonstrate a
commitment not only to employees and customers, but also to causes and organizations that
impact the lives of others.

Takeaway: Investors care about corporate social responsibility and so should companies.

Check out the 10 companies doing corporate philanthropy right

Note

Become a Matching Gift Expert! Grab our Free Ultimate Guide to Matching Gifts.

How Nonprofits Benefit from Corporate Social Responsibility

1. Funding Via Matching Gift Programs

Corporations that offer matching gift programs essentially double the donations that
their employees are giving to eligible nonprofits.

What more could an organization want?

Truthfully, matching gifts are a bit more complicated than that.

Each company has a different set of guidelines, deadlines, and requirements that must be met
before they’ll match an employee’s contribution to a nonprofit.

However, the opportunity to receive twice as many donations still hangs in the air for
organizations looking to benefit from corporate social responsibility programs.

Takeaway: Matching gift programs have the potential to double, and sometimes even
triple, an organization’s fundraising revenue.

Download the Ultimate Guide to Matching Gifts

2. More Volunteer Participation

Corporations that offer volunteer grants are outsourcing helping hands to eligible nonprofit
organizations.
A corporation with this kind of program might offer (for example) $250 to a nonprofit once an
employee has volunteered at least 10 hours with the organization. There are also pay-per-hour
grants that many corporations offer that pay a certain amount per hour volunteered.

This kind of socially responsible program is a win-win for every party involved. Employees of
corporations are seen volunteering and donating their time to important causes in the
community, and nonprofits are receiving free time and volunteer work, which are essential
for the success of so many nonprofits.

Takeaway: Volunteer grant programs are a crucial component of CSR that bring in more
revenue and volunteer time for nonprofits.

Learn more about volunteer grants

3. Forging Corporate Partnerships

Yet another positive impact corporate social responsibility has on nonprofit organizations is the
possibility of corporate partnerships.

These partnerships are vital to the work a corporation can do in the local community and
important to a nonprofit that may not have the resources for major marketing campaigns.

For a nonprofit organization, a partnership with a local or national corporation puts its name on
tons of marketing materials that otherwise could not have been afforded on tight budgets.

A key benefit is that the partnership brings additional awareness to the nonprofit’s cause.

Takeaway: CSR brings nonprofits and companies together, creating strong partnerships
between the two.

Take a look at the corporate giving statistics

4. Varied Sources of Revenue

Nonprofits cannot solely rely on individual donations for support.

Granted, individuals make up roughly three-fourths of an organization’s total monetary

contributions, but this doesn’t mean that nonprofits should discount corporations and
businesses as viable sources of revenue.

In fact, companies with strong corporate social responsibility programs are looking for
nonprofits to be the recipient of grants, matching gift programs, and volunteer grant programs.

CSR initiatives can help nonprofits make up that left over 25% after they’ve looked to
individual donors.
Takeaway: Corporate social responsibility programs can be another source of revenue for
nonprofits.

Check out the ultimate guide to nonprofit fundraising

Note

Become a Matching Gift Expert! Grab our Free Ultimate Guide to Matching Gifts.

How Employees Benefit from Corporate Social Responsibility

1. Positive Workplace Environment

When corporations exhibit philanthropic behavior, they are more likely to provide employees
with a positive workplace. Consequently, employees feel engaged and productive when they
walk into work each day.

Instilling a strong culture of corporate social responsibility within every employee from the
top down will help to create a positive and productive environment where employees can
thrive.

Corporations that care about the lives of people outside the walls of their businesses are more
likely to create a positive environment.

Takeaway: Business environments are more enjoyable when companies engage in

corporate social responsibility.

2. Increase in Creativity

Employees who know that their employer is committed to bettering the local and global
communities feel a stronger connection to the company. Because of this close relationship that
employees share with their company, workers feel more inclined to be productive and creative.

Employers have identified creativity as one of the most important leadership qualities that
an employee can possess. Creative employees enjoy working for companies that they can
believe in and stand behind.

By incorporating comprehensive philanthropic programs, companies can help employees become

more productive and creative.

Takeaway: Companies that maximize their social responsibility potential foster innovative
and creative employees.
3. Encourages Professional & Personal Growth

When companies have a culture of corporate social responsibility, they can easily promote
volunteerism to their employees and encourage them to donate to nonprofits.

When employees contribute their time and money to worthy causes, they develop
professionally and personally.

By helping those in need and volunteering as teams, employees learn to work better together on
important projects. Employees also experience a sense of pride when they know that they work
for a company that cares about the community and encourages them to be passionate about
worthy causes.

Takeaway: Employees are able to professionally and personally develop as a result of

corporate social responsibility.

4. Promotes Individual Philanthropy

When employees notice that the company they work for is involved in charitable endeavors, they
play follow the leader and begin to engage in their own philanthropic activities.

If a company encourages group volunteerism and matches donations to nonprofits with a

matching gift program, an employee is more likely to take advantage of those programs and
become more individually philanthropically minded.

Without the strong sense of CSR that a company should adopt, employees are less likely to
branch out themselves and serve the community with monetary donations and volunteer efforts.

Takeaway: Employees become more philanthropically aware when they work for
companies that are socially responsible.

Definition of corporate social responsibility (CSR)

Movement aimed at encouraging companies to be more aware of the impact of their business on
the rest of society, including their own stakeholders and the environment. [1]

Corporate social responsibility (CSR) is a business approach that contributes to sustainable

development by delivering economic, social and environmental benefits for all stakeholders.

CSR is a concept with many definitions and practices. The way it is understood and implemented
differs greatly for each company and country. Moreover, CSR is a very broad concept that
addresses many and various topics such as human rights, corporate governance, health and
safety, environmental effects, working conditions and contribution to economic development.
Whatever the definition is, the purpose of CSR is to drive change towards sustainability.

Although some companies may achieve remarkable efforts with unique CSR initiatives, it is
difficult to be on the forefront on all aspects of CSR. Considering this, the example below
provides good practices on one aspect of CSR – environmental sustainability.

Example

Unilever is a multinational corporation, in the food and beverage sector, with a comprehensive
CSR strategy. The company has been ranked ‘Food Industry leader’ in the Dow Jones
Sustainability World Indexes for the 11 consecutive years and ranked 7th in the ‘Global 100
Most Sustainable Corporations in the World’.

One of the major and unique initiatives is the ‘sustainable tea’ programme.  On a partnership-
based model with the Rainforest Alliance (an NGO), Unilever aims to source all of its Lipton
and PG Tips tea bags from Rainforest Alliance Certified™ farms by 2015.  The Rainforest
Alliance Certification offers farms a way to differentiate their products as being socially,
economically and environmentally sustainable. [2]

Corporate Social Responsibility

Corporate Social Responsibility, or “CSR,” refers to the need for businesses to be good corporate
citizens. CSR involves going beyond the law’s requirements in protecting the environment and
contributing to social welfare. It is widely accepted as an obligation of modern business.

CSR goes beyond earning money for shareholders. It’s concerned with protecting the interests of
all stakeholders, such as employees, customers, suppliers, and the communities in which
businesses operate. Examples of CSR include adopting humane employee practices, caring for
the environment, and engaging in philanthropic endeavors.

Some people contend that companies owe no duty to society outside making as much money as
possible within the law. But those who support Corporate Social Responsibility believe that
companies should pursue a deeper purpose beyond simply maximizing profits.

BENEFITS OF CSR
More consumers than ever are demanding that companies change the way they do business,
become more transparent, and take an active role in addressing social, cultural, and
environmental issues. Corporate Social Responsibility (CSR) has taken its place in today’s
corporate world, and businesses that ignore it do so at their own peril.

What is Corporate Social Responsibility (CSR)?

Corporate Social Responsibility means that a company takes steps to ensure there are positive
social and environmental effects associated with the way the business operates. Businesses that
engage in active CSR efforts take stock of the way they operate in the world to incorporate
addressing cultural and social issues, with the aim of benefiting both in the process. Not only can
CSR models increase business and revenue, they promote change and progress throughout the
world, which often involves helping people with few or no resources.

CSR is viewed different from philanthropy. When properly implemented, it should become
ingrained in the values and culture of a company, and positively affect the way the company
does business. CSR should become inherent in the mission and message of an organization, and
also hold a strong place in marketing and advertising. Companies should be aware that
promoting their CSR model only benefits the company if they are already acting on their plan.
Otherwise, falsely claiming to bring social change to those in need could lead to bad publicity.

Businesses that ignore corporate social responsibility run a risk to their bottom line and their
brand. Having a bad reputation socially and environmentally can create serious negative effects
on the overall profitability and success of a company, as nowadays consumers want to spend
their money on products and services that they believe in, and engage with companies that follow
ethical practices that meet their own beliefs.

Companies with CSR models

The Coca-Cola Company’s CSR program known as 5×20 has a goal of employing five million
women in developing countries by 2020 in both bottling and distribution roles. This goal will not
only benefit the women in the communities surrounding Coca-Cola manufacturing plants, but
could also benefit the communities as a whole, as the company aims to provide better access to
health care and improved education to their employees.

The corporate social responsibility model implemented by Visa provides financial opportunities
for people in developing areas of the world. By partnering with local governments and nonprofit
organizations, people who previously did not have access to the benefits of banking and financial
services now do.. The Gates Foundation found that this type of service helps low income and
poor people manage their finances in trying times, build assets, and increase connectivity
worldwide.

On a smaller scale, there are entrepreneurial companies known as B Corporations employing

CSR into the very fabric of their own businesses. Their missions are threefold: people, planet,
and profits. The “B” refers to beneficial, and thirty-one states in the U.S. currently recognize B
Corps. These businesses are required by law to meet strict standards of social and environmental
performance, with companies like Seventh Generation, Pura Vida, and Etsy great examples of B
Corps.

The Importance of CSR for Millennials

As the millennial consumer population grows, it is critical that companies consider their
corporate social responsibility status. Instilling a model of social responsibility is necessary for
attracting what is becoming one of the largest market segments. Millennials are particularly tech
savvy, and they don’t think twice about researching a company and looking into its ethical record
and labor practices. Many feel like it is their duty to do their part in making the world a better
place, and this burgeoning generation does not want to be associated with or support companies
who do not take responsibility for the world and the people in it.

Employee engagement is also tied to a company’s CSR reputation. A recent Deliotte survey
found that 70 percent of millennials acknowledged that a company’s commitment to social
responsibility influenced their choice to work there. With millennials soon to be the largest
generational segment of the workforce, companies looking to hire these workers will need to
embrace CSR in order to attract and retain talent. Millennials don’t just want to consume
products and services made by companies that have a CSR presence; they want to take part in
making these social and environmental changes also.

Conclusion

Corporate social responsibility is more than just a business trend or fad. Businesses that want
to stay relevant to new generations and who want to help people in need around the world
while increasing their own revenue and efficiency will benefit from embracing CSR.

http://business.time.com/2012/05/28/why-companies-can-no-longer-afford-to-ignore-their-social-
responsibilities/2/
https://www.ama.org/publications/MarketingNews/Pages/millennial-demand-for-social-
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