Community * Society * World
Whatever your business and whoever you are, it’s going to behoove you to consider your company’s impact on your community, society and the world. Whether you are strongly motivated for your own personal or political reasons to contribute to some type of activism, or you’re merely driven by the increased call from consumers across the board for corporate social responsibility, making profits may no longer be enough. In fact, making profits appears to be more and more contingent on the impact your company has in regards to social and political systems surrounding it.
Take for example Fox News and their recent firing of Bill O’Reilly. O’Reilly was not let go from that corporation despite years of sexual and racial harassment allegations. He was fired when news of those charges and the company’s covering-up of those allegations reached consumers on a broad scale, spread of course via social media, and those users pushed Fox’s advertisers to drop their support for the channel, company, and O’Reilly himself.
Kylie Jenner & Infamous Police Officer Pepsi Can Hand Off
PepsiCo also had a moment this year where consumers impacted the distribution of one of their advertisements. They released a commercial featuring protests and Kylie Jenner, who left a photo shoot to join the protest and seemed to find the world and domestic peace by simply offering a police officer a Pepsi.
Then there are companies who, for their own reasons, have committed to social, political or other action without apparent pressure from their consumers. For example, many big-name (and small-name) businesses have pledged to meet the standards for the Paris Climate Agreement despite the Trump administration withdrawing the US from it officially. The Harvard Business Review reported before Trump’s official announcement on a list of businesses who were attempting to influence the president’s decision and/or committing to the climate standards regardless of the president’s decision. These include Bank of America, Coca-Cola, Goldman Sachs, General Electric, Tesla and even Disney!
Social Responsibility is a Form of Self-Regulation
According to the Small Business Chronicle, “Social responsibility is a form of self-regulation that businesses adopt as a part of their corporate conscience and citizenship.” Corporate social responsibility as it is usually known is a way to monitor and even preempt your company’s perception within the greater public as well as your impact, as mentioned above, even if there aren’t specific governmental regulations dictating your actions. “The business goal of social responsibility is to encourage the company’s efforts toward the positive impact of consumer, community and employee responsibility.”
A paper released by Stanford University in 2015 analyzes the impact of a company incorporating corporate social responsibility into its primary business model. TOMS Shoes entered the market in 2006 primarily as a manufacturer of footwear. “CEO and founder Blake Mycoskie was inspired to start the company after taking a trip to Argentina where he learned that many children go about their lives barefoot, too poor to afford shoes.”If you’re at all familiar with TOMs, you know that they are famous for their buy-one-give-one strategy; every pair of shoes that is purchased results in another pair of shoes being donated to a child who could not otherwise afford shoes. This type of strategy was labeled “philanthropic capitalism” by Slavoj Zizek, and at TOMS it is designed to “stimulate simultaneous revenue growth and social advancement, a unique blend of two spheres that are seen by many as in competition.”
As of 2016, the company had donated more than 50 million pairs of shoes. They have also expanded the business, and every new product comes with a new charitable effort. In 2016 they started selling coffee and donating a week’s worth of water for each bag sold to people in need. Additionally, purchases of their eyewear products provide a person in need with a professional eye exam as well as any treatment they require such as prescription glasses, surgery, and other medical procedures. Their bags purchase medical and other support for pregnant people in need, providing the means for safe births, free from infection with safe birth kits, training, and delivery resources. Finally, their High Road Backpack revenues go toward training staff and counselors in schools or involved with school-aged children and adolescents to minimize the detrimental effects of bullying.
As of 2015, TOMS reported revenues of approximately $350 Million, with their numbers growing steadily year-to-year since their founding and more than doubling from 2012 to 2013. “While it is impossible to conclude with certainty that TOMS Shoes is a thriving company due to the lack of available financial records, had TOMS struggled significantly to find profitability within their business model, the company may not be in existence today.”
There are different types of corporate social responsibility you can consider for your own business if you have the desire but not the particular vision of TOMS’ founder (who, by the way, started out hoping he’d be able to donate at most 250 pairs of shoes, if that).
Voluntary Hazard Elimination
Voluntary Hazard Elimination refers to the process by which your company removes waste or practices that might contribute to harm of the greater public of your own accord. Many companies have incorporated solar power, or efforts to minimize their carbon impact, for example. Even something like offering a discount at a shop for customers who come prepared with their own bags or containers could fall into this category.
Community Development would be what TOMS does in training teachers and counselors to respond to students in crisis due to bullying. The private college I attended had a cooperative program with a local women’s prison to provide classes toward a Bachelor’s degree for inmates.
Philanthropy is the old-school practice of donating portions of your profits to charitable organizations or efforts. This is also one of the categories TOMS falls into because of their product donations; Bill and Melinda Gates utilize their Foundation to donate both money and computers to those in need, contributing to charities handling education, agriculture, health and more.
Social Education and Awareness
Finally, Social Education and Awareness refers to a business communicating with the community as a whole, as through social media, to listen to the desires and/or demands of socially conscious consumers. This is to ensure that the company is doing its social duty, complying with ethical and other standards, and to discover where improvements or additional social action can be incorporated into the business model.
Other smaller initiative can include providing space for local groups, whether they be activists or otherwise, to gather in your space at a reduced cost or merely for the price of purchasing some of your products. You can also allow posters or signs for advocacy groups, like the shop I work for notifying customers that we are an anti-Islamophobic space safe for Muslims, as well as other minorities. The shop also has a donation jar next to the tip jar that is currently accepting donations for an immigrants’ rights organization. We get as many tips as we make donations much of the time and these efforts have had no detrimental effect on our customer loyalty or revenue numbers, as far as I’m aware.
Corporate Social Responsibility – With Great Power Comes Responsibility
Owning and running a corporation is a lot of responsibility already; but consider adding social responsibility to that list, and it may just boost your reputation and, by extension, your profits. Plus, the world will undoubtedly be a better place for it.