Benefits of having a social audit.
Corporate social responsibility (CSR) is commonly mistaken with corporate philanthropy: companies making contributions, or charity gifts to organizations around them. However, this does not capture the breadth of activities that are included in the spectrum of CSR activities.
Another popular area of the CSR spectrum is community engagement, but a company’s relationship with the community around them doesn’t really capture some of the more strategic, and possibly more self-interested elements of CSR, either.
With the purpose of creating a common understanding of CSR, we can define as everything a company does to create public value. This can be very flexible to each company’s industry, and specific processes, and may include the previously mentioned charities, or employee volunteering, but in the long term, the company becomes truly responsible when engaging in sustainable practices, such as being a responsible actor of the supply chain, amongst many other ways of acting ethically.
It is imperative to understand the global importance of corporate social responsibility to understand why it is important for your company to be socially responsible, and how its’ strategic use can positively impact any organization, and its environment.
So, financially speaking, why should we care about corporate social responsibility?
With increasing complex issues in our society such as climate change and growing inequalities being engrained in our every purchase, each actor in our society needs to contribute to lessen our negative impact to the best of our ability. Ultimately, the cost of our actions is paid at another point in the supply chain, by workers under undignified working conditions, or people who suffer the consequences of climate change.
This is where CSR comes into play, as its goal is it create a win-win situation from the corporate perspective, generating good business, while lessening negative impacts. These include the protection of worker’s health & safety, including those within our supply and distribution chains, upholding human rights, and protecting the community and environment in which we operate. Ultimately, this aims to create shared value:
Additional benefits to your company include:
- Demonstrating that your company and employees are compliant with local laws, international standards, and ethical practices applicable to your region and industry to your clients and stakeholders. This ultimately allows for higher levels of confidence in the company.
- Collecting valuable data to improve decision making as a company, and an industry
- Enhancing relationships with all stakeholders
- Attracting and retaining talent, promoting employee engagement
- Generating a value-based corporate organizational culture and firm standards of corporate conduct
- Choosing a financially sustainable option to acting merely out of social good, allowing for profit maximization