Corporate Social Responsibility (CSR) is a term commonly used to depict a business' efforts to attain sustainable results by adhering to good business standards and practices.
CSR is increasingly being viewed as an integral and essential part of regular business operations. CSR can involve various aspects of a company's operations. These range from community contribution, workplace safety to family-friendly practices. A business gains a good corporate citizen status when it shows dedication to fair operations and socially conscious business practices.
Create shareholder value
Most investors are looking to invest in companies that have social responsibility and good corporate governance. If your business has a good CSR policy, it is likely to attract more investors. This will improve your financial standing and protect you from instability.
Increased revenue base
CSR can enhance factors that affect revenue in significant ways. CSR activities and cause-linked marketing can enhance goodwill and reputation among your customers and suppliers. If your employees identify with the social mission, they are likely to be committed, motivated and more ready to make sacrifices as team members.
In attracting and maintaining a new customer base, a company's reputation plays a key role. Consumers today are more refined, becoming more choosy and conscious to an organization's image and CSR initiatives. If your business has a distinctive CSR profile, it can be a strategic branding tool which you can use to differentiate yourself from your competitors.
Efficiency in operations
Business efficiency is primarily about effective use of resources and productivity. CSR can help your business enhance efficiency through recycling initiatives and environmental conservation, as part of eco-efficiency approach. Maintaining good management-employee relations is also key in bringing about productivity, good customer service and product innovation.
Improved Access to Capital
Access to capital is important for a company's growth and investment. Over the years, there has been an increasing emphasis on Socially Responsible Investment (SRI). If your business has a good CSR reputation, you are likely to secure debt and equity capital with relative ease.
A company's human resource is one of its most treasured assets. A favorable working environment can help your business attract, retain and develop human resource, while enhancing operations and maintaining high staff morale. Community involvement can contribute towards encouraging participation, developing new skills, team spirit and sharing in the workplace.
Reduced Business Risk
Today, companies are increasingly being held responsible for their actions. This business risk could have an effect on access to capital, long-term viability and most importantly, reputation. To minimize and preempt the repercussions, your business should engage in proactive discussion with external stakeholders so as to foster understanding.