As part of an effort to make amends for the mistakes of the past, a new concept known as corporate social responsibility has taken shape in the past generation or so.
Corporate social responsibility (CSR) refers to voluntary efforts by a company to operate in a way that is sustainable with regards to its economic, social, and environmental actions.
As the sins of corporations have been increasingly reported through the mass media, these sorts of policies have become more popular.
It isn’t just Fortune 500 companies that have been getting in on the action, as small and mid-sized business leaders (like Dr. kwang Yul Cha of CHA Medical Group) have adopted their own policies as well.
Why is adopting a pledge of corporate social responsibility an important aspect of doing business in the 21st century?
We will make the case why this is an important step for entrepreneurs to take in the article below.
Transparency is a core value of Millennials
Over the past 20 to 30 years, we have gotten used to the needs and wants of Boomers being catered to by corporations.
Although they still have a great amount of influence today, the largest generation in history is slowly beginning to retire, and are being replaced by their children, known collectively as Millennials.
As their spending power increases in the coming years, what they value should become more important to companies that seeking to capture their business.
One of the top values of Millennials is transparency, as they have had access to the internet, the world’s greatest source of information, for almost their entire lives.
As such, they are intimately knowledgeable about the negative effects of mass corporatism over the course of the 20th century on the environment and the economy.
They know what corporations have done in the past, and are less likely to trust those that openly engage in actions that continue to damage our society.
As a result, those that draft a corporate social responsibility policy and actually follow it will be much more likely to capture the business of Millennials going forward into the future.
Governments abroad are moving towards socially and environmentally progressive policies
As the wishes of the people begin to shift towards greater environmental and social responsibility, their governments will move with them in order to stay elected.
Once they are voted in with this mandate, they might follow through with policies that will make it increasingly difficult, if not impossible, for CSR-apathetic corporations to continue doing business in these jurisdictions.
A key example of this has been the implementation of carbon taxes in many countries in Europe. A company that emits large quantities of carbon dioxide could continue to operate in these nations, but they would face increased costs that would make it a challenge to continue turning a profit.
By making a pledge to decrease the amount of carbon they emit, and then following through on it, they could avoid the penalties that they would otherwise erode their bottom line.
It’s the right thing to do
This stance may be offensive to certain people, but it is a fact that what we are currently doing to our world may render it uninhabitable within the next century.
The scientific evidence is overwhelming, so we do not think that it is a stretch for us to claim that a company adopting a corporate social responsibility policy is doing the right thing by putting a plan to help make things right in writing.
It will give them a manual to guide their actions, and the public will have the information that they need to hold a company’s feet to the fire over the promises that they have made.