No business can succeeds without the aid of contributing factors involved in its operations. Employees, consumers, suppliers, and the community are directly involved and affected by the business and what it does. The products and the way the products are introduced have an impact to the society.
Corporate Social Responsibility or CSR then becomes a significant strategy in business because consumers would opt for companies that can be trusted; suppliers would prefer conducting business transactions with reliable companies; and employees would like it better working for employers with good business ethics and principles. In the same way, NGOs are bound to work hand in hand with organizations that are solution-oriented and those seeking innovation in common areas of concerns.
The Significant Factors of CSR
The increasing importance in most businesses lately is due to three particular trends. These are changing social expectations, increasing influence, and globalization.
As businesses transact with consumers and the society, the expectations of the people toward the companies that they do business with are increasing every time. For example, if customers have known certain companies to provide good customer service, they expect it to remain the same or become even better. Companies that practice CSR gain the trust and loyalty of their consumers.
Developed countries adapt the CSR approach in their businesses which contributed to an increasing affluence. Affluent consumers have the capability to choose which product they will buy and which company they will transact business with.
Lastly, globalization allows shortcomings and mistreatment of certain companies to be exposed to the public for awareness through the power of the media. The internet has also contributed to the effects of globalization since it allows consumers of similar preferences and ideals to communicate and empower each other when it comes to purchasing rights and privileges.
A company attains business success with the application of these three trends along with the increasing importance of product brands and brand value which strengthens the relationship between the company and its consumers, as well as the company and its stakeholders. Combining these three trends makes consumers and the society better informed as well as feeling the essence of their roles as purchasers or buyers.
Benefiting from CSR
Corporate social responsibility is more than doing things right. It is about making responsible business practices and behaving dependably and conscientiously with stakeholders. If your business demonstrates these responsible practices, you are building a good reputation in the society. A reputable business is not only preferred by stakeholders and especially the buying public but people often insist on transacting with such company.
For one, companies observing CSR are socially inclined and environmentally friendly. Apart from that, there are many other benefits a business may acquire from CSR. With good reputation, a company makes it easier to attract and hire skilled employees. The working individuals tend to offer loyalty and longer stay, allowing companies to save on recruitment and training costs. As to performance, employees have better motivation and increased work productivity. CSR enforces people to adhere to regulatory requirements.
Another benefit is that a company gets positive press coverage when it actively gets involved in local community activities. Building a good relationship with local authorities becomes easier for the business such as conducting marketing events. A company increases its competitive edge over other organizations with CSR.
CSR and Corporate Brands
Generating brand name and brand recognition is best coupled with CSR. Businesses are aware that brands are one of the major focal points of business success. The more exposed a certain brand is to the buying public, the more popular it becomes and people are able to easily recall your company with these brands. Popular brands increase company leverage and create a huge impact on sales and revenue.
In adhering to a strong CSR policy, a company gains three main benefits in brand recognition. One is positive marketing or brand building. Next, a company generates brand insurance. Lastly, the company is able to deal with crisis management efficiently.
Businesses always aim to maximize and protect its investments and revenue or profit that is why many of these companies uphold a good CSR policy which can contribute so much in being able to stay active in the competitive nature of the business world.