In Western countries, the investor community has long expected that companies in which they invest act responsibly and have integrated “CSR” policies as part of their business models. Implementing ideas when industry competitors are only starting to think about them is a wonderful way to differentiate yourself from the competition and attract investors, consumers, and skilled employees. Those who wait until the last-minute risk falling far behind.
Corporate social responsibility is not unique and has progressed in recent years. Companies were formerly limited to participating in charity activities for the benefit of society and thought that this was adequate. Today, we have a much broader understanding of this concept. In terms of practicality, where do you begin? The ideal place to start is to identify the organization’s significant stakeholders (those who are interested in the outcomes of its actions, such as customers, employees, shareholders, suppliers, business owners, and the local community) and then consider their basic needs. What is most important to your firm (apart from profit, of course), and what makes it distinctive, given the location?
It makes no distinction whether we are talking about a tiny or medium-sized business or a giant corporation; you can always start doing something, and there are many ways to accomplish so. Take the attitude toward employees, for example. Primarily, you may aid in the improvement of the health and well-being of your employees by offering them more flexible working conditions and a more appealing work-life balance. Last year’s research by the International Federation of Accountants (IFAC), the youngest generation Z prioritizes stable career development over income levels when choosing a workplace. Salary and bonuses are in second place, but the perfect balance of work and personal life is right behind them, in the top three crucial variables.
There are also many other options for improving working conditions in the company, such as providing different opportunities for people with various needs, providing training or internships for those who are just starting in their careers, and preventing gender or national discrimination in determining remuneration and career advancement. The ladder is boosting employee knowledge of corporate social responsibility and conducting studies on how employees perceive it.
On a local level, you can participate in local community projects (for example, Subotnick), donate your premises for public use if they are not already in use, and encourage staff to do the same.
Finally, environmental protection is an essential topic that is particularly vital to manufacturing companies. Companies can reduce pollution by recycling waste, eliminating plastics from their products, being more selective with their suppliers, increasing their use of public transportation or corporate fleet sharing where conditions allow, regularly cleaning up waste in the surrounding area, or participating in landscaping projects.
What are the commercial advantages of this strategy? The Triple Bottom Line (TBL) concept was introduced by American economist and entrepreneur John Elkington in 1994, according to which, when developing a business model, company managers and individual entrepreneurs must consider not only the financial side of the equation but also the social and environmental factors. According to Elkington, profit, people, and the environment are the “three pillars” of any firm or “pillars of sustainable growth.”
Critics point out the practical problems of putting the notion into practice, particularly when integrating it into the accounting system: environmental costs are difficult to quantify. For example, the long-term implications of dumping toxic waste are only quantitatively apparent. If this is the case, managers will react unfavorably to adding them to the calculation in the short term. The issue is further compounded by the absence of universal mandatory standards, even though international organizations (such as the GRI group) have already created several voluntary guidelines.
Monitoring is an arduous task for beginners. It will be crucial to consider what indicators will be used to monitor the effectiveness of corporate social responsibility strategy execution.
Today, everyone can see that investors, employees, and clients will not become less demanding over time; the reverse is true. A corporate social responsibility policy should be imposed “from above,” starting with the board of directors and spreading to all levels of the organization, rather than being reduced to a mere allegation on a corporate website. People are unlikely to be duped, and the negative consequences of discovering that all the statements were false can be highly damaging.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.