Benazir Marjan is intended to use her business knowledge in the practical field through this article.
CSR Benefits both the Business and a Society. How?
Corporate Social Responsibility is a type of business self-regulation with the aim of being socially accountable. There is no one ‘right’ way companies can practice CSR; many corporate CSR initiatives strive to positively contribute to the public, the economy or the environment. In today’s socially conscious environment, employees and customers place a premium on working for and spending their money with business that prioritize CSR.
CSR benefits both the business and the society. The business can be benefited in eight ways.
1. CSR brings a better brand recognition. Brand recognition is the ability of a consumer to recognize one brand over other brands. When a company is contributing towards social welfare, usually it promotes the contribution in newspapers, journals, TV channels and also in social media. People become able to recognize the certain brand fast. It creates better brand acknowledgement in the market for the company.
2. CSR creates strong business reputation. Once a company is doing for well-being of a society it attracts huge people towards its business. The importance of good reputation in business is just beyond any explanation. Without a good reputation no business can run for a long time. It will be also fail to generate profit. A company’s superiority in the market largely depends on its reputation. Good reputations will always attract loyal customers which is a great beneficial acquisition for a company.
3. CSR helps to increase sales and customer loyalty. As people get good apprehensions through CSR, company’s sales automatically increase, which generates more profit as well. It also creates customer loyalty due to their societal devotion. Loyal customers are not willing to switch their preferences to other brands very easily. CSR will help to produce constant, faithful and resolute customer who will help a company to alive in a hard competition.
4. The expenses incurred due to CSR, they can be considered under operational cost. Operational costs are the costs of resources used by an organization just to maintain its existence. Therefore, cost due to CSR is including in a company’s operational cost. Thus, companies will not feel CSR as very expensive. This is how considering CSR cost separately, naturally reduces a company’s operational cost.
5. CSR enhances financial performance. It creates a good image before the stakeholders which favors a company in all aspects.
From internal stakeholders, employees and managers will give their best performance to their work due to strong notion of the company. From external stakeholders, suppliers will be always in favor. Society, government and creditors will be on the company’s side. Shareholders will buy more shares. Last but not the least, customers will be trusted customers.
6. CSR will increase the ability to attract talent and retain staff. As CSR works for social well-fare, people working in other companies get know about it. Sometimes, they may switch to the strong company due to their talent. This is how CSR attract more efficient employee towards the company. It also helps in staff retention. Doing strong CSR companies create strong brand identity. Usually, employees have little tendencies to switch from a well built company.
7. CSR increases organizational growth. Being a socially responsible company can bolster a company’s image and build its brand. Social responsibility empowers employees to leverage the corporate resources at their disposal to good. Former CSR programs can boost employee morale and lead to greater productivity in the workforce.
8. The better a firm’s performance, the fewer capital restraints it will face. Better CSR performance helps to earn improved stakeholder engagement which pushes manager to adopt a long term strategy. Long term strategies help a business by allowing it to be proactive in its growth rather than by simply reacting to market conditions.
A society can be benefited in five ways from CSR.
1. Companies may have charity for orphans, special needed children and old people. This is a great support for a society for this kind of people who needs help to survive.
2. Restaurant owners sometimes feed to street kids in a particular area. This is also a beneficiary part of executing CSR for a society. CSR also works for improving labor policies. It helps to ensure labor right in a community.
3. Companies also donate to ensure a clean environment for the country. Dust removal program and tree plantation project really ensure a better environment for the society which helps to maintain a good ecological balance in the earth as well.
4. Companies arrange different kind of social awareness programs under CSR, which make people aware about different cardinal issues in a society.
5. Finally, CSR works for the society which develops a country’s overall situation. Slowly, it helps to increase patriotism among people which benefits the country as a whole.
To conclude with, CSR should be inbuilt into the functioning of various activities of corporate sector. It should be a way of life for them due to its advantages towards the business and the society, as well as the country in a whole.
This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.
© 2020 Benazir Marjan