Eric-Theodore Yepao Discusses Corporate Responsibility Beyond Charitable Donations
Many people believe that corporate social responsibility is a simple matter of giving a portion of a company’s profits to charity. While many companies take part in this form of giving, it is not the only corporate responsibility aspect that executives should be aware of.
Eric-Theodore Yepao examines the practice of corporate social responsibility in detail, explaining the benefits of being a good corporate citizen.
The Practice of Corporate Responsibility
Companies have promoted social responsibility for many years. The broad goal of corporate responsibility is contributing to society’s well-being and the community to which they belong.
Many companies want corporate social responsibility to go beyond a simple concept of doing good for the community and provide a concrete economic benefit. Business experts believe that putting too much emphasis on the benefit to the company’s bottom line gets in the way of corporate social responsibility.
Environmental Responsibility
A socially responsible company needs to consider the environment when setting policies. Environmental initiatives may include reducing waste, using renewable energy, and doing its part to reduce global warming by lowering greenhouse gas emissions.
Companies that want to increase their environmental responsibility should look carefully at the community’s needs. For example, if a country where a company does business does not have a sound healthcare system, helping to fund sanitation and clean water may be more important than reducing its carbon footprint by reducing greenhouse gas emissions.
All companies should consider their impact on the earth, and they need to assemble their policies per the newest environmental research.
Economic Responsibility
Economic responsibility makes sure that companies consider their decisions’ effects on their business and society. Economic responsibility can boost the effectiveness of business operations while promoting sustainable practices.
Philanthropic Responsibility
Giving money to important causes is one of the top aspects of corporate social responsibility. Companies may choose to donate their money, their employees’ time, or both to support community initiatives both close to home and around the world.
Companies should not stop at philanthropic responsibility. They should create policies for all types of corporate social responsibility.
Human Rights Responsibility
Companies need to make sure that all of their policies promote human rights around the world. Supply chains need to be monitored to ensure no reliance on forced or child labor. Human rights responsibility covers issues relating to equity between male and female workers and the inclusion of workers in protected classes.
Benefits of Being Socially Responsible
Companies can reap benefits from their corporate responsibility in the following ways:
Public Image and Brand Recognition
Socially responsible companies have a better public image than companies that do not emphasize giving back to the community in some way. Companies receive greater brand recognition as well.
Higher Sales and Customer Loyalty
Socially responsible companies enjoy higher sales revenues and better customer loyalty. They also have an easier time attracting and retaining quality staff members.
Cost Savings
Social responsibility can also lead to cost savings, especially in the environmental category. When companies waste less, they can experience better profit margins.
For example, a cereal maker may start using less packaging or less energy, making their business model more sustainable while lowering overall costs.
Innovation
Companies trying to be more socially responsible may meet challenges more creatively and explore the possibilities of new products. For example, a shampoo maker could reduce its use of water and find a new formula for a product that uses less water on the consumer end.
Lower Regulatory Burden
Having good corporate responsibility policies in place can mean that a business has a lower regulatory burden. Companies that are viewed as responsible may have better relationships with government entities than those that are not.
Socially responsible companies may also enjoy better access to capital. Banks will be more inclined to do business with them, and they will be able to expand into new markets more easily.
Corporate responsibility involves looking at the long term effect and driving sustainable growth over time. Having a sustainable future is one of the biggest benefits of corporate responsibility. This means that companies shift from being concerned only with their next quarter’s profits and instead consider how their business decisions will affect social and financial results in the years to come.
Best Practices for Corporate Responsibility
Companies with the best corporate responsibility practices have programs that are coordinated with each other and with the company’s mission. While some of these initiatives create value for the company, this should not be considered the top motivating force.
When a company is interested in creating a corporate responsibility policy, executives should make sure that it is aligned with the company’s purpose and values and the needs of the community.
Eric-Theodore Yepao believes strongly in the power of corporate responsibility to transform society. He wants companies to understand that they should leverage their strengths to benefit the world we live in.
