7 tips for putting corporate responsibility at the heart of your business
Corporate responsibility is the way a company takes responsibility for its actions and their impact on employees, stakeholders and communities.
It includes the way your company conducts its business, how it manages its impact on the environment, how it treats its employees and how it supports community activities that aim to solve social problems such as poverty or discrimination.
It’s not enough for companies to simply donate money to charity. While charity is commendable, the real core of corporate responsibility is ensuring that everyone in your organization is accountable and works to earn the trust of consumers and investors by meeting their expectations of ethical and responsible behaviour.
Why corporate responsibility makes business sense
Being a socially responsible business often involves higher material and labour costs. But there is a business case to be made for being a good corporate citizen.
In a competitive labour market, employees are drawn to companies that have a good track record for responsible behaviour, such as environmental protection. By being a good role model, a company will attract people who have skills such as innovativeness, leadership and the ability to work in teams. And by treating employees responsibly, costly employee turnover is minimized. It is also good for a business to stand out from the crowd—for the right reasons of course. Being a good corporate citizen can help a company differentiate itself.
For example, if a company shows that it is committed to helping solve social problems such as rising high school dropout rates, it is also showing that the firm values positive social change. That image will appeal to customers who want to deal with a company that genuinely cares about young people. And by adopting improved environmental practices, a company shows consumers and the public that it cares about the community, the planet and the future. This can help solidify and guarantee customer loyalty. (Improved environmental practices also help a company to comply with environmental regulations and avoid penalties.)
So where does a company start? Here are seven tips you can follow to ensure your company is a responsible corporate citizen.
1. Adopt a business code of ethics
A business code of ethics will outline employee conduct on issues such as ethics, values, environment, diversity, employee respect and customer service.
More and more entrepreneurs are choosing to go one step further by changing their governance document to include their commitment to social and environmental goals.
2. Follow a workplace health and safety program
Creating a clear workplace health and safety program will help you establish reliable systems to protect your employees and prevent accidents and injuries. It will also ensure you are compliant with government legislation on health and safety.
3. Commit to protecting the environment
Develop policies and practices that allow your company to fulfill your commitment to the environment. For example, you can consider producing a report that documents your activities and results as they relate to your environmental impact. Some companies produce broader “sustainability” reports, which encompass social, economic and environmental activities.
4. Get your suppliers on board
Ensure your suppliers know and meet your expectations of responsible behaviour regarding issues such as fair pricing, for example. Screen them to determine their past conduct, and tell them what you expect.
5. Be smart about donating money
Get behind causes that are meaningful for your business. A forestry business, for example, might choose to support organizations that protect the environment. Many manufacturing businesses donate to community organizations in towns where they have plants. The idea is to give back to society, while at the same time sending a message about the values of your brand.
6. Don’t greenwash your business
Use marketing techniques that are fair and honest, and that reflect your company’s integrity. Avoid any advertising or communication that could be seen as manipulative or harmful to the public. Make sure you walk the talk and that your company does what it says it does, otherwise your company could risk a customer backlash.
7. Explore B Corp certification
Many public and society-minded entrepreneurs are choosing to get B Corp certified. B Corps are certified “beneficial” companies. Their purpose is to create value for society as well as money. They meet high standards of transparency and accountability, and create positive social and environmental benefit.
Beyond the certification, B Corp entrepreneurs are a movement of people who believe that business can be a force for good in the world. Learn more about BDC's involvement in growing the B Corp movement in Canada.