In order for societies and the environment to be positively sustainable, businesses must operate with a Corporate Social Responsibility (CSR) mindset. But what is Corporate Social Responsibility? This is a mode of operation that ensures that the downsides associated with business operations are minimized. Some examples of CSR include ethical business practices, local community support, and waste reduction. In turn for engaging in CSR practices, companies receive higher levels of competitive advantage and sustainability due to their positive reputations. Corporate social responsibility is a win-win for both companies and the communities they serve.
How Corporate Social Responsibilty Came About
Corporate social responsibility didn’t simply appear out of thin air. This mindset was accumulated over many years of industrialization in order to preserve much of the Earth and its people. Mauricio AndrĂ©s LatapĂ Agudelo, Lára JĂłhannsdĂłttir, and Brynhildur DavĂdsdĂłttir’s literature review dive deep into the history of CSR and its present state. Through many decades, CSR has become a popular notion due to the rise of globalization, increased awareness of environmental issues, and pressure from investors and the government. The globalization of business has increased the visibility of companies’ operations and their impact on society and the environment. Because of this, consumers that value their society and sustainability of the environment are more likely to support companies that demonstrate CSR values. Investors also prioritize CSR, as they recognize the potential for long-term sustainability and profitability for companies that do so.
Lastly, governments have played a role in pushing CSR through regulations that promote a reduced waste, pollution, and other emissions. Today, CSR has evolved to encompass a broad range of activities, from philanthropy and community involvement to sustainable practices and ethical business behavior that is leading towards more sustainable businesses.
The Triple Bottom Line Approach
The triple bottom line concept is a key driver of CSR, as it emphasizes the importance of considering not only profits, but also the people and planet in business operations. Kelsey Miller’s article shortens the complexity which is corporate social responsibility and shortens it into 3 key concepts: Profit, people, and planet. The “people” component refers to a company’s social impact and involves considering the welfare of employees, customers, suppliers, and local communities. This includes issues such as fair labor practices, community engagement, and social justice. The “planet” component refers to a company’s environmental impact and involves considering issues such as climate change, pollution, and resource depletion. With a high focus on environmental concerns, many companies taking steps for the environment are positively impacting their public reputations. Finally, the “profit” component refers to a company’s economic impact and involves assessing financial performance and creating value for shareholders. By considering all three components together, companies can develop long-term sustainability and competitiveness, as well as positive social and environmental outcomes.
CSR In Action: Starbucks
Starbucks is a fantastic example of corporate social responsibility. As the worlds largest coffee drink chain, Starbucks needs tons of coffee sources from less fortunate countries in South America, Africa, and Asia. Therefore they have embarked for over 15 years to have 100% of their coffee beans ethically sourced. This means that:
- Workers that grow coffee beans have good working conditions, essential human rights, and decent pay
- Sustainably growing and harvesting trees.
Starbucks uses no cheap labor and always considers the trees and plants they effect when sourcing their materials. Because of this, Starbucks has improved the lives of millions of farmers and workers, and their environments. They are leading by example, showing that even the largest companies can still profit, and can even earn more profit, by doing the right thing.