It’s a question I hear time and time again. Smaller businesses, from one person working in their back bedroom to some considerably larger companies, just don’t get CSR. But if they think it’s got nothing to do with them, they could be risking the future profitability and sustainability of their own business.
The big corporates understand CSR. For many of them it is now very high on the agenda. No longer is it an A4 document full of meaningless platitudes, dusted off every now and again and displayed proudly to stakeholders. A document that doesn’t bear any semblance to reality no longer works and could potentially cause more harm than good. CSR has to have real teeth!
So what does CSR really mean? It’s an unfortunate term as the “corporate” bit is very misleading. CSR really does apply to any business, whatever the size. In a nutshell, it is about how business takes account of its economic, social and environmental impacts in the way it operates – maximising the benefits and minimising the downsides. We prefer to call it social and environmental responsibility – but CSR is more succinct!
The corporate world knows that all the threads of good CSR, if embedded within the culture of the company, will lead to reduced overheads, a more productive workforce and an enhanced reputation – all leading to long term increased profitability. In many countries, being able to demonstrate good social and environmental credentials will also help businesses win public and private sector contracts.
Are there any SMEs (small and medium enterprises) out there that don’t want reduced overheads, increased productivity, an enhanced reputation and long-term profitability?
Does your business have a social impact? Of course it does. It’s all about people. Staff if you have them (and just looking after yourself if you don’t!), your local community, your suppliers and customers, even the wider community. Have you checked recently that child and / or sweatshop labour has not been used to produce your raw materials? Do you care?
And most of us know what considering the environment means, although I hasten to add it is a bit more than recycling! The bit that is forgotten is that “carbon reduction” nearly always means overhead reduction!
But note that it is also about economic impact. A responsible business is a profitable business supporting the owners, possibly staff, and contributing to the local economy.
Forget any soft fuzzy thoughts you may have had about CSR. This is hardcore business stuff.
The world is changing rapidly. The era of greed is all but gone (banks notwithstanding!) and the demand for ethics, honesty and transparency is increasing. In this new era, if you don’t engage in the CSR agenda or aren’t seen to be doing so, you could lose competitive advantage to a business that is. So do the right things, for the right reasons: be ethical and honest, care about people, the community and the environment and shout about it very loud.
It will stand you in good stead with your staff, customers, suppliers AND those bigger companies and public sector bodies who increasingly insist on seeing their suppliers’ social and environmental credentials. But remember, authenticity is crucial. Never, ever, exaggerate what you have actually achieved; and never be afraid to admit when you don’t get it quite right. Be prepared to strive for continual improvement, but appreciate that perfection is quite hard to attain.
Jill Poet is Managing Director of the Organisation for Responsible Businesses (ORB) a UK-based business membership organisation that has also developed the Responsible Business Standard. To find out more about these organisations visit www.orbuk.org.uk and www.ResponsibleBusinessStandard.org.uk