Corporate Social Responsibility
A Corporate Social Responsibility Policy, or CSR policy, is becoming an important part of any businesses strategy. It is aimed at increasing both business and social value.
The term CSR describes business behaviours that are responsible business practices and have a positive social impact.
They usually include a business participating in initiatives that are intended to benefit society.
Producing a formal written policy helps the management team to focus on what is important to them and how they want the business to be perceived by others. It can help to identify core values, establish respect for a company, enhance its credibility, or establish or confirm its position as an industry leader.
A written CSR policy can be a requirement if a company is tendering for contracts or applying for grants.
In the case of Public companies, shareholders will expect to see evidence of CSR. Clients too will expect to see the company demonstrating a sense of responsibility for its impact on society, and mounting philanthropic initiatives.
Research suggests that CSR has an influence on consumer purchasing behaviour. The level of support will depend on the specific CSR issues the company focuses on, and consumers support for it. Although the intention is to positively influence consumers, some CSR initiatives can work against the company and reduce the likelihood of consumers purchasing their products.
Employees like to feel their company is playing its part, and employee engagement is always a plus for a company. Many people enjoy fundraising for good causes, and the activity can help bring employees together from different departments and sites.
What is contained in a CSR policy?
There is no defined format, but typically a CSR policy will state the businesses philosophy, aspirations and commitment to its staff, suppliers and customers. It may state the business ethics and standards of conduct, mentioning honesty and integrity.
It may record the management’s operating principles and their intentions to take into account its economic, social and environmental impact in the way the business operates.
It could state that they will uphold the company policies on health and safety, equality and diversity, environmental policies, fair remuneration for employees, as well as their intentions to abide by ethical principles when dealing with clients, and to work with charities and communities.
A typical policy may have the following headings;-
- Management commitment and philosophy statement
- Health and safety policy statement
- Environmental policies and issues statement
- Business continuity and disaster recovery policy statement
- Human resources related statements-equality and diversity, fair remuneration
- Customer relationships statement
- Community relations statement
What do executives say?
Catherine Garrett-Cox, CEO of the UK’s Alliance Trust, who partner the Soldiers Charity, says that no business is an island. “It is about collaboration. If you want to have a broader role in creating genuine prosperity for all, you can’t do it by yourself “.
She says companies’ responsibility is to society as a whole, and suggests that Boards should recruit leaders and mangers based on their CSR credentials and the ability to lead values and behaviours. She even suggests their remuneration should take into account the businesses contribution to society.