In an organised startup development, corporate social responsibility often gets lost in the shuffle. Many startup founders tend to focus on launching and improving their products or services, innovations, finding investors to get funding, and monetization.
You might also opine that Corporate Social Responsibility is only for big companies, thus you will only do it once your startup has scaled up. However, this conception is not necessarily true. As a startup, you should focus on social responsibility from day one.
What is social responsibility?
Often referred to as CSR, social responsibility is a term used to describe a company’s efforts to improve a community and society. In the past, many business leaders only focused on the idea of charity and volunteering as their social responsibility programs. But as the world progresses and consumers flock to brands associated with good causes, more spotlights are directed onto CSR.
Corporate social responsibility initiatives are categorised into four subjects, including:
Environmental responsibility focuses on reducing pollution and greenhouse gas emission, as well as sustainable use of natural resources.
Human rights responsibility focuses on providing fair labour practices, such as equal pay for equal work, fair trade practices, and disavowing child labour.
Philanthropic responsibility focuses on initiatives such as funding educational programs, supporting health initiatives, donating to causes, and supporting community projects.
Economic responsibility involves improving a company’s business operation while participating in sustainable practices, such as using a new manufacturing process to minimise wastage.
Why should startups fulfil their social responsibility when the company is still new?
Former Director at Silicon Valley Community Foundation Liz Lipton-McCombie said that there is still limited data on how doing social responsibility impacts a startup. But there is an extensive case for how it boosts the bottom line of publicly traded companies. For example, social responsibility in startups has the potential to:
increase market value by 4-6 percent;
increase shareholder value by $1.28 billion over 15 years;
increase price premium by up to 20 percent;
reduce staff turnover by 50 percent;
increase employee productivity up to 13 percent.
Additionally, CSR is not only profitable to those that do it, but it is also invaluable in terms of gaining connection and relationship with the public.
CSR to build momentum and relationship – engaging in CSR in your early stages shows that your company cares not just about profit, but about community as well. If you have a strong connection with an influential community, you are obviously going to have a rich connection with your customers and clients.
CSR to leverage marketing and image – today’s generations are more socially conscious about the environment, people, and brands. 70 percent of consumers want to know what brands they support are doing to address social and environmental issues; while nearly 50 percent of consumers also pay close attention to brand’s social responsibility efforts when they buy a product. Hence, implementing CSR early can give your startup a cutting edge and positively develop your startup reputation early rather than later.
CSR to create a better world – apart from helping your startup gain profit and recognition, CSR activities simply make the world a bit brighter. A small initiative that you start can likely move the hearts of thousands which is not only beneficial for you and team, but also the whole society.
As consumers and society are more aware of the environment, global warming, and social issues, corporate social responsibility should be a pillar in your business strategy. The earlier you start your CSR movement, the better your startup will prosper!