Introduction
Key points covered by this study guide are:
The reasons businesses are becoming more socially responsible
How business can protect the environment
How businesses can support the local community
These are the key terms to remember:
Reasons – Environment - Community
Watch: What is the social responsibility of businesses?
Watch this video explaing corporate social responsibility
Narrator:
Just because you are a business and trying to make money it doesn't mean that you don't have to think about others.
All organisations have a responsibility to think about how their activities will affect the world around them.
Business owners have found that being socially responsible helps their business in many ways.
It has a positive impact on how they are seen by their customers.
Some customers not only prefer to deal with responsible companies but insist on it.
To reduce its environmental impact a business can implement policies such as encouraging their employees to share cars, walk or use public transport.
It can also use technology to reduce the amount of paper it uses, and to manage and maintain its buildings and vehicles in an energy efficient way.
A business can also decide to use recycled products and make sure it recycles its own waste, and reducing waste and emissions doesn't just help the environment, it saves money too. And it doesn't stop there.
If a business is responsible in these ways, it can recruit better staff, keep its best employees, and when workers feel more valued they will work harder.
Another way of showing social responsibility is by contributing to the local community.
Some businesses choose to support a local charity or sponsor a local event.
Restaurants might provide food to local homeless groups.
Builders might give free labour and materials to community projects.
Many companies sponsor a local sports team and invite schoolchildren in for work experience.
There are loads of ways for businesses to support their community, and it all helps get the message out that they are friendly, approachable, and want to do something to make their community a better place to live.
What is CSR?
The idea that business should be socially responsible is called corporate social responsibility (CSR). It's the idea that organisations have a responsibility to consider the interests of society.
They must think about the impact of their activities on:
- customers
- suppliers
- shareholders
- communities
- environment
An example of CSR is a coffee company using fair trade beans to support farmers.
CSR is voluntary. It requires a business to go above and beyond what is required by law. It helps to end corrupt, irresponsible or unethical behaviour.
The main reason that companies are becoming more socially responsible is that it benefits their business. Obviously, some business owners and managers will be particularly interested in social projects because of their personal beliefs and connections. But businesses are driven by profit.
They will always want to ensure their actions advance their business objectives.
What ways can a business demonstrate social responsibility?
Why should a business demonstrate social responsibility?
The social responsibility of employers refers to the ethical obligation of businesses to contribute positively to society while conducting their operations. This concept goes beyond legal compliance and includes a commitment to the well-being of employees, the community and the environment.
Here are key aspects of the social responsibility of employers:
Environmental Responsibility
Sustainability: Adopt environmentally sustainable practices, such as reducing waste, conserving energy and minimizing the business’s carbon footprint.
Resource Management: Use resources efficiently and responsibly, promoting recycling and environmental stewardship.
Safe Working Conditions
Ensure a safe and healthy work environment by adhering to health and safety regulations and addressing potential hazards.
Ethical Business Practices
Compliance: Adhere to all applicable laws, regulations and industry standards.
Diversity and Inclusion
Equal Opportunity: Promote diversity and inclusion by providing equal opportunities for all employees regardless of race, gender, age, disability or other factors.
Anti-Discrimination: Implement policies to prevent discrimination and harassment in the workplace.
Community Engagement
Local Impact: Contribute to the local community through charitable activities, sponsorships and partnerships with local organisations.
Volunteering: Encourage and support employee involvement in community service and volunteering initiatives.
How can businesses be more environmentally responsible?
There are two main environmental areas that businesses can target in their efforts to be more socially responsible.
Carbon footprint
A carbon footprint is the measure of the environmental impact of an individual or organisation. It is measured in units of carbon dioxide.
It is composed of two parts, a primary and secondary footprint.
- A company’s primary carbon footprint is made up of emissions from energy consumption and transportation, associated with its activities.
- The secondary footprint is made up of indirect emissions associated with the energy consumed by its suppliers and customers.
Reduce, reuse, recycle
This describes efforts to create as little waste as possible by being careful about how products are used and disposed of. There are many good reasons to reduce, reuse and recycle.
Reducing, reusing and recycling can lower greenhouse gas emissions and ensure the proper disposal of litter.
Everything used has to come from somewhere and must go somewhere once finished with.
- Reducing the amount of waste produced is a good way to help the environment.
- Reusing stops creating more waste in the future.
- Recycling enables the materials thrown away to be used again.
What's the outcome of a business reducing their environmental impact?
The creation of an energy and environment strategy can help companies address “green” issues. This can result in improved financial and environmental outcomes.
| People | Travelling to and from work forms a large part of an individual’s carbon footprint | Businesses can encourage their employees to share cars, walk or use public transport. |
| Information | Digital technology often reduces the amount of paper that we use, but it uses more power. This IT-related energy use contributes to a business' greenhouse gas emissions. | Businesses can be more conscious of their e-waste, encouraging staff to optimize cloud storage, clear up files, reduce data streaming and organising their files and data. |
| Property | Companies can reduce the greenhouse gas emissions of their office buildings and vehicle fleets (for example, lorries used for transporting goods and company cars for senior staff). | Managing and maintaining buildings effectively leads to a smaller environmental impact. |
| Business operations | Corporations can change the way they operate to reduce environmental impact. | A company can measure its energy and water use, and set targets to reduce them. |
| Recycling policies | Businesses can encourage their staff to reduce, reuse and recycle. | They can think about how they buy their goods and equipment. They might create awards for departments that recycle the most. |
How can businesses support their local communities?
A business can support its local community in various ways:
- encouraging the use of local products
- fundraising
- scholarship programmes
- skills-based volunteering
- sponsoring local teams and projects
- support a local charity
- voucher schemes
- volunteering in local schools and community projects
- work experience placements
Getting involved
Some businesses get involved in the local community by choosing to support a local charity or sponsor a local event or sports team.
It's good sense to get involved in an activity related to a specific business activity, for example, some restaurants provide food to local homeless groups while builders might give free labour and materials to community projects.
Any business could encourage their employees to volunteer with projects and charities in the community.
Experienced staff might take part in school career days and practice interview skills with students in Year 12. The business shares its experience with teachers and young people, and helps them to gain an understanding of the workplace.
Employee involvement
Many businesses involve their employees in working with the local community.
Some businesses encourage employees to volunteer for community activities and give them paid time off to do so. This can help motivate employees and develop their people and team participation skills.
Voucher schemes
Businesses can encourage their employees by giving them vouchers to help with childcare or shopping.
An example of a voucher scheme is encouraging employees to cycle to work. The cost of a new bike and equipment is deducted from their salary as a non-cash benefit and they save on tax and national insurance. Many bike shops accept such vouchers as if they were cash.
Businesses may also offer voucher schemes to schools to provide computers, sports equipment or other resources.
Sponsorship of local teams and projects
Many businesses sponsor local football, rugby or GAA teams. This gives them an opportunity to display their logo on shirts and advertising hoarding. It shows that they have a commitment to the local community.
Scholarship programmes
Businesses can work with colleges and universities to help outstanding students find work. This keeps the business connected to their local education providers and the local community, and ensures that there are university graduates with skills that are relevant to the workforce.
Work experience placements
Many companies offer work experience opportunities to pupils from local schools. The students get a better understanding of the world of work and make informed decisions about their future careers.
These are also great opportunities for businesses to get positive coverage in local media. They can show their communities that they are friendly and approachable.
Encouraging the use of local products
Businesses can show their commitment to the community by using local suppliers where possible. This can help create a network of people and businesses that help each other by buying and using local products. Products such as meats, chesses, butters, oils, craft drinks and seasonal vegetables are found in restaurants and cafes all around Northern Ireland and also in multinational supermarkets who have a commitment to stocking locally produced goods.
It's not just food and drink that is produced locally - ceramics, art works, candles, jewellery and clothing all made in Northern Ireland are sold in local shops and markets.
What are the benefits of being socially responsible?
Being socially responsible can provide many benefits for a business, here are a few of them:
| Benefit | Outcome |
|---|---|
| Increased sales | Consumers may buy more goods or services from businesses that are environmentally friendly and community driven; resulting in more sales and ultimately more profit. |
| Increased publicity | When businesses support and invest time and skills in helping the local community they often attract positive media coverage, both in the local and sometimes national press. |
| Saving money | By reducing their resource use, as well as their waste and emissions, businesses can lower utility bills and make savings for their company. |
| Finding and retaining staff | Businesses that are sustainable and have corporate social responsibility policies can often attract the best employees and manage to retain them; reducing the need to recruit, saving the organisation time and money |
| Improved community relations | When businesses and their employees are involved in the local community, for example through volunteering, sponsorship or mentorship, the business's reputation is improved and this helps build customer loyalty. It can also foster positive relationships with local authorities such as councils and local government agencies. |