Corporate Social Responsibility:
Why It Matters
By Michael Arkes
During the past decade, corporate social responsibility (CSR) has moved from a "nice-to-have" option for many companies to an imperative. It has become an integral part of the new social contract between business and society.
There is growing recognition that businesses bear a responsibility for what happens in this new world. Beyond turning a profit and producing quality goods and services, they are expected to consider the impact of their actions not only on their shareholders, but also on their customers, employees, suppliers and communities.
Practiced by businesses of all sizes in just about every industry, corporate social responsibility takes a wide variety of forms. It can include green and sustainable business practices, philanthropy, business-relevant volunteerism, cause marketing and community activism. It also can be reflected in a company's basic corporate culture—including diversity and inclusion policies, compensation and benefits packages, and work-life balance initiatives—and in its procurement practices and supplier relationships.
The importance and impact of CSR are evident from several perspectives. The first represents a macro view—making the world a better place. Consider the environment and the growth of green and sustainable business practices, for example. Actions companies take to cut their carbon footprint, prevent pollution, or address energy efficiency and conservation directly affect the survival of the planet and everyone on it.
But, it is on the micro level that the significance of corporate social responsibility really resonates. Simply put, it profoundly and personally changes people's lives. Funds donated through philanthropy, for example, support everything from scholarships to health clinics. Mentoring programs, social service initiatives and outreach programs connect companies with their communities and give employees opportunities to make a difference.
In addition, thousands of individuals are directly assisted through corporate partnerships with social enterprises. A social enterprise is an organization that operates as a business—usually manufacturing a product—for the sole purpose of funding an important social agenda. Most provide training, transitional employment, support services and other opportunities to disadvantaged individuals—those least likely to be hired—offering them a helping hand, not a handout.
Studies have found that 75 percent of participants in social enterprise job-training programs retain their jobs over a two-year period. Their monthly income triples, education levels improve, housing stabilizes, and criminal recidivism rates decline dramatically.
For example, at Bright Endeavors, a nonprofit social enterprise in Chicago, homeless and at-risk young women between the ages of 16 and 25 gain the necessary skills to become self-sufficient, successful adults. This organization offers transitional employment through the manufacture, sale and distribution of its natural Dreambean eco home and bath products, and uses the proceeds to support training, mentoring and permanent job placement.
One recent graduate of the program, Cristiana, was empowered at Bright Endeavors to overcome the obstacles of a life affected by drug addiction, domestic abuse and homelessness. Now at the age of 20, she has earned her GED, acquired professional skills and experience, been hired at a major financial institution, and enrolled in college. You can see her inspiring story and other's at www.youtube.com/HelpingHandRewards.