Milton Friedman said in the 1960’s “the business of business is business” ….but in 2013, is it more than that?
Last week I attended a seminar on Corporate Social Responsibility (CSR) which looked at the impacts of globalisation on CSR strategy. No longer can companies sit back and take a “that’s not my problem” point of view. In an age of information overload and the speed at which news travels through social media, CSR is as much about risk management of public perception (e.g. Primark in Bangladesh or BP in Florida) as it is being about “the right thing to do”. It is no longer acceptable to participate in practices that could impact negatively on society and in turn the company. CSR used to be simple but organisations have moved on from ‘corporate philanthropy’. It’s now about ethics, standards and sustainability. Professor GP Lantos calls it Ethical, Altruistic and Strategic CSR. For example, Merck published their ‘2012 Corporate Responsibility Highlights’ as being: 3.3 billion gallons of water recycled or reused; 20% reduction in lost-time injury; $1.7 billion in total giving…
Social financing such as Big Society Capital has increased accessibility for large or small organisation’s to contribute to social projects with the opportunity to also see a financial return on their investment.
So here’s a another statistic: 92% of all 16-21 year olds reoffend within five years coming out of prison – but what does that have to do with the business world? A charity in Leicester are working with the government to fund initiatives to aid in training, rehabilitation and life coaching for these young adults. If these projects are deemed to be success (eg, reducing the cost of crime/prison costs and reducing benefits costs) then they will give them a return on their investment by up to 13%. The impact for business is potentially significant but not risk free. However it is been proven that investing in these young adults rather than leaving them to reoffend and just putting them back into prison is far more beneficial for society, cheaper for the government and a financial opportunity for businesses who invest – a win win situation!
And it is not just big businesses with money to invest that can get involved. We were given some shocking facts and figures on London: within the borough of Tower Hamlets 52% of children receive free school meals and the number of people sleeping rough had increased by 62% from 2011 whilst there has been a 60% reduction in funding for initiatives and 41% of social organisations closed down in 2012. But there are a number of schemes the companies can implement, from conducting one off skills workshops, volunteering shelters, visiting the elderly or hiring a young person through specialised recruitment schemes such as Fringe Benefits.
It has been proven that CSR is gaining importance when recruiting new (CSR aware) talent and it is also is a key factor in improving perceptions of organisations. What could your organisation do big or small to work on their CSR impact?
Zoe Osborne is a Consultant in London and has inevitably been tasked with re-writing our CSR policy.
