Introduction to the concept of CSR and its significance

In the year 1991, we have seen a dramatic shift in the needs of business and society in general.
This was the time when many organizations in India had begun understanding the significance of
business involvement in the community. This has been making progress from that point forward,
and today, CSR has turned into a part of the business process.

Today’s consumer hold organization to a higher standard. They searching for something beyond
material items or quality services while picking an organization to work with. 9 out of every 10
consumer anticipate that organization will make a benefit as well as operate responsibly to
address social and natural issues according to a study held by Cone Communication. 84% of
global consumers also said they will go for the responsible product whenever possible.

As an organization go through globalization, many difficulties have waited for them from
government policies to the varying benchmarks of what is deemed to be labor exploitation, these
challenges have challenges can possibly cost organization millions of dollars. A few
organizations are of the view that these approaches are only a cost hindrance, while different
organizations utilize CSR strategies as a procedure to gain the support from the public in the
global market.

Recognizing how important social responsibility is to their customers, many organization now
concentrate on and practicing a couple of broad categories of corporate social responsibility
(CSR).

1. Environmental efforts:
One Essential Concentration of corporate social responsibility is the environment. Organization
regardless of size have a large carbon footprints. Any means they can take to eliminate those
footprints are viewed as both useful for the organization and society as a whole.

"European companies have really led the way on environment efforts, such as green energy
usage, eco-friendly office and travel policies, and ensuring that businesses take a responsibility
for controlling if their net impact is positive or negative," said Richard Stevenson, head of
corporate communications at ecommerce platform ePages.com
2. Philanthropy:

Organization also practice social responsibility by giving to national and local charities or
foundations. Organization have a lot of resources that can profit the charities and local
community programs.

3. Ethical labor practices:

By treating employees fairly and morally, organization can also show their corporate social
responsibility. This is particularly valid for organizations that work in global areas with different
labor laws.

4. Volunteering:

Going to volunteer events says a lot about an organization’s sincerity. By doing good deeds
without expecting anything in return, organizations can express their concern for particular
issues and support for specific organization.

Consumers and partners always want to hear that a business is getting more than just revenues.
Even modest steps such as ‘open door days’ can be an incredible approach to build connection
with your community and reflect that you plan or aim to have valuable and long term impact.
"This new wave of buyers is demanding transparency, and when given the choice, will almost
always choose a brand or product tied to a socially conscious cause rather than a corporate big
name brand," according to DeeAnn Sims, founder of creative agency, SPBX.

So from the above we can say that CSR (Corporate social responsibility) is the forefront of the
modern day business practices.

WHY CORPORATE SOCIAL RESPONSIBILITY MATTERS

All stakeholders in a business try to comprehend and value the mission of the organization, and
why they should invest and support in it and that, is the reason CSR matters.

Liz Maw, CEO of nonprofit organization Net Impact, noted that CSR is becoming more
mainstream as forward-thinking companied embed sustainability into the core of their business
operations to create shared value for business and society. Sustainability is not just important
element for human and the planet, but also a vital element for the success of business.

More practically, CSR shows the policies, practices and initiatives of an organization commits to
in order to govern themselves with honesty and transparency so that they will have positive
impact on social and environmental wellbeing .

Not only the consumer who are drawn to the company or an organization that give back to the
society but today’s top talent also wants to work with the company who’s doing CSR.

Typically I think there are 6 business benefits, why organization should go with the corporate
social responsibility:

 Innovation:

When we use innovation in relation to CSR, it plays a huge benefit to a society and
company. For example I recently saw a video of Geoff McDonald (Global VP for HR,
Marketing, communications and sustainability. Mr. McDonald described that with the
lens of sustainability, unilever was able to produce new products such as hair conditioner
which require less water.

 Cost Savings:

one of the easiest way for a company to start engaging in CSR is use it as a cost cuts.
Whether it’s using less packaging or less energy. For example by 2015 General Mills can
reduce its energy savings by 20%.

 Brand Differentiation:

Now a days CSR is the best tool to differentiate your product.in the past it was the sole
 motive of the organization but now it’s becoming harder day by day. For example the
“Cola Wars” between Coke and Pepsi. They both are adopting same but slightly different
road to CSR. Both Pepsi and Coke are pursuing strategies of zero net water usage. Both
use environmental friendly packaging.

 Long Term Thinking:

The statement issued by Unilever “The only reason we’re doing sustainability is to drive
the growth of Unilever”. Most of them is doing CSR because of organizations long term
interest and ensuring that the company’s future is well sustainable.

 Customer Engagement:

Using CSR can help you to interact with the customer in new ways. Since message is
about “good”, it can often be an easier way to talk to your customer. For example
Walmart has established itself as a leader on environmental efforts. Walmart is doing an
ad campaign designed to raise awareness about the environment and the product choices
customer could make.

These are the reasons why companies are doing CSR. There can be various other reasons for
a company to involve in the CSR.