Policy brief & purpose. Our Corporate Social Responsibility (CSR) company policy refers to our responsibility toward our environment. Our company’s existence is not lonely. It’s part of a bigger system of people, values, other organizations and nature. The social responsibility of a business is to give back to the world just as it gives to us.
Corporate social responsibility is the practice of integrating social and environmental goals into business operations. Common roles of CSR include helping control costs, improve a company's brand, attract top-quality talent and facilitate long-term financial success.
TL;DR (Too Long; Didn't Read)
Rather than focusing solely on the bottom line, companies that employ the concept of corporate social responsibility examine how their business practices affect their employees, customers, local communities, human rights and environment on a larger scale .
Features of Corporate Social Responsibility
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The United Nations Industrial Development Organization notes that the common functions of corporate social responsibility include:
- Responsible sourcing of materials and supplies
- Employee, vendor, customer and community engagement and relations
- Adherence to labor standards
- Environmental protection and management
- Anti-corruption measures
- Upholding social equity, gender equity and other human rights goals
- Conservation of resources, like water and energy, in production
Cost Savings Benefits
Sustainable business practices can benefit a company's bottom line as well as the environment. By developing products that use less energy or less packaging, a company can also save on utility bills and materials expenses. One notable example is General Mills, which the Office of Energy Efficiency and Renewable Energy reports has reduced a third of its energy costs by using more efficient lighting and equipment and cutting heat waste.
Brand Perception Benefits
Investing in the community and supporting local organizations can set a business brand apart from the rest. Responsible business practices can improve public perception of a company's brand, which can increase its customer base and overall sales. It can also garner interest from investors that only invest in socially-responsible companies.
Increased Employee Loyalty
Corporate social responsibility helps companies attract and retain top-quality talent. Employees often look for employers that display ethical behavior and have values that align with their own. The firm notes that a variety of companies saw employee motivation and loyalty increase after engaging them in corporate social responsibility initiatives, and these companies felt they were able to obtain better-quality employees as a result.
Long-Term Financial Success
Executives who receive quarterly or annual performance-based incentives -- a common practice among corporations -- often focus primarily on a company's short-term financial results. While this is an important component ensuring profitability, it doesn't necessarily mean that profits are sustainable for the long-term.
Functions of corporate social responsibility help a company ensure long-term, sustainable financial health. For example, reinvesting profits into the local community and universities helps create a thriving local economy, which makes it easier to find talented employees and contractors. Committing to sourcing inventory and materials in a sustainable, environmentally-friendly way ensures that the company won't run out of resources in the future for developing products.
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.
Identification
John D. Rockefeller, whose success in business enabled him to start the Rockefeller Foundation in the early twentieth century, articulated the essence of corporate social responsibility. He said, 'I was trained from the beginning to work and save. I have always regarded it as a religious duty to get all I could honorably and to give all I could.' Whenever businesses make contributions to their community, they are honoring this tradition of giving back to the people who make their ongoing success possible.
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
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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.