A business owner is responsible for more than making enough profit to pay workers and keep the lights on in the office. Leaders have many obligations to their employees, stakeholders, customers, and communities. Some of the more apparent “rules” businesses must follow are paying taxes, making payroll, and abstaining from illegal activities.
There are other responsibilities that people believe businesses have beyond following the law, however. Many believe companies have a duty to support environmental and social issues. In fact, 70%
of U.S. consumers want to know what the brands they support are doing to address social and environmental issues. Globally, 67%
of people agree that it has become more important that the brands they choose positively contribute to society.
Though the data shows that customers and employees expect more from companies than ever before, it can be difficult for growing brands to define and execute a high level of social responsibility. This guide will show you exactly how to determine social responsibility for your company and make it an integral part of your company culture for years to come.
Ethics and social responsibility decoded
We can define and interpret the terms “ethics” and “responsibilities” in many different ways, making it hard to pinpoint precisely what they mean. Although many use the terms "business ethics" and "business responsibilities" interchangeably, they actually represent very different ideas.
Social responsibility focuses more narrowly on a company’s social obligations.
Acting ethically ultimately means determining what is “right” and what is “wrong.” Basic standards exist around the world that dictate what is wrong or unethical for businesses. For example, people generally consider unsafe working conditions to be unethical because they put workers in danger.
Social responsibility focuses more narrowly on a company’s social obligations. It’s the extent to which companies owe something to the environment, the economy, and “society at large.” To put it in perspective, businesses may cite environmental sustainability as one of their social responsibilities.
Corporate social responsibility programs
Companies are increasingly integrating corporate social responsibility programs (CSR programs) into their business and aligning themselves with current social movements. CSR initiatives can look different for different companies, but they usually revolve around charitable fundraising, workplace conditions, social benefits like health care, volunteerism, and environmentalism.
Defining your company's social responsibilities starts with defining your values.
Having clearly defined values, morals, and responsibilities is critical as a business today because it attracts top talent, simplifies decision-making, creates differentiation, and can boost market share. Social responsibilities should be formed early on and act as a guiding force for all new products, services, manufacturing processes, shipping/receiving, packaging, hiring, and company-wide policies.
Defining your company's social responsibilities starts with defining your values. Ask yourself and your team questions like, “Who are we and what drives us?” “What do we want our company to stand for?” “How are we different from our competitors?
For example, if your company values the environment, you have a responsibility to reduce your carbon footprint. If your business values inclusion, you have a responsibility to showcase all groups of people in your advertising. Once you know your values and the responsibilities you have to uphold those values, you can work to integrate them into the fabric of your growing company.
Maintaining social responsibility in 4 steps
1. Cultivate a culture committed to social responsibility
If you want social responsibility to be top of mind for your employees, you’ve got to start by educating your senior staff, providing training to your employees, developing a leadership team that will spearhead initiatives that support your social responsibilities, and drafting company-wide initiatives that reflect your values.
Bragging about your company’s values isn’t helpful if management isn’t on board. Encourage your managers and executives to lead by example.
Next, give your employees the tools they need to understand the company’s values and responsibility. Don’t just make social responsibility training part of your onboarding process, make it a quarterly or monthly event. Finally, establish a leader or leadership team to ensure that your company is living up to its values.
Coca-Cola infuses social responsibility into their company culture with company-wide initiatives. Those include ‘a world without waste,’ which aims to collect and recycle every bottle, make their packaging 100% recyclable, and replace all water used in creating their drinks. They claim that by 2030, they will have reduced their carbon footprint by 25%.
2. Look to your community to determine how you can serve its needs
Wanting to change the word is a nice sentiment. However, it’s best to start small and make a difference in your immediate community first.
Review the needs of your community annually or quarterly and determine how your company can best serve its needs. Consider giving employees paid days off to provide volunteer services or create a company-wide volunteer effort.
If environmental sustainability is important to your business, think about hosting a local recycling event. You could also consider giving to a local charity or cleaning up litter on hiking trails. As your company grows, you can begin “giving back” in bigger ways and in bigger locales.
A great example of using local communities to create change is water bottle company Klean Kanteen. The company advocates for environmental sustainability as a member of 1% for the Planet. They host free filtered water stations at events and people know them for their staff’s dedicated volunteer efforts.
3. Continually evaluate your processes regarding social responsibility
Most companies want to reduce their impact on the environment, support diversity, and leave a positive mark on the world. Being a socially responsible company can mean fine-tuning your processes in all areas of your business.
Regularly look at how you are manufacturing your products, what materials or ingredients you’re using, and how you're shipping your products. Evaluate your hiring procedures, your performance reviews, and your promotional structures.
Create a set schedule for reviewing these practices and determining if they align with your social responsibilities. Is your workforce diverse? Who is receiving promotions and why? Are your products made from recyclable materials? Do the factories have fair working conditions?
A perfect example of process evaluation is Smartwool. Smartwool, a performance wool company, launched a program to take back its old socks from customers and repurpose them into the filling for dog beds.
4. Involve your employees in socially responsible initiatives
Involving your employees is critical to ensuring the longevity of any socially responsible initiative. When initiating social responsibility programs, give your employees a voice by involving them in the decision-making process.
Ask your employees what they care about and how it contributes to larger company values. Contributing to something your employees are passionate about drives their engagement and success.
This can be as simple as creating an office Slack channel dedicated to discussing programs or volunteer efforts. Encourage discussion around these kinds of opportunities and see where it leads.
Netflix and Spotify listen to their employees and broadcast their values publicly. Each company uses its social media platforms to show support for movements such as Pride month, environmental sustainability, and Black Lives Matter.
Bottom line when it comes to social responsibility
All businesses are born out of a need to help someone in some way. Nike shoes were designed to help runners run in comfort. Netflix was founded to reduce the hassle of driving to the video store. Amazon was created to make books more accessible and affordable. Though the origins of the biggest companies in the world were modest, they have grown to employ millions of people, serve millions of customers, and cross dozens of continents.
The Jeff Bezos-type executives of the world aren’t the only ones responsible for social and moral issues, however. Small business owners are just as important in making change. In order for your business to grow, you must determine what your legacy will be. Will you be a company that cares about the planet or a company that contributes to climate change?
By defining your values early on you can identify the responsibilities you have as a business. It’s not enough to be ethical anymore, customers want to know that you are making the world better, even on a small scale.
To accomplish this, you need to have strategies that assure your adherence to your responsibilities no matter how many employees or customers you have. By cultivating a culture of social responsibility, leaning into your community, evaluating your processes, and collaborating with your employees, you can make sure your company is leaving a positive mark on the world.
Get inspired to create your own social responsibility programs with these quotes:
LEGO Group CEO, Niels B. Christiansen said: “We cannot lose sight of the fundamental challenges facing future generations. It’s critical we take urgent action now to care for the planet and future generations. As a company who looks to children as our role models, we are inspired by the millions of kids who have called for more urgent action on climate change.”
“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.