Objective: You will learn how to embed social and environmental responsibility into your business, which benefits your business (especially in your community-building efforts) and the world!
Will your business change the world for the better? Will it have a net-positive effect on the environment? Will it improve the lives of people who fit in the oppressed identity groups the earlier Personal Privilege lesson talked about? If not, you should make the changes, big or small, that will make the answer to those questions a yes! Having “yes” answers to these questions will strengthen your business and its community, which are critical to your success.
Social and environmental value is inherently important.
Embedding social and environmental considerations and value into your business is inherently important. Whether you like it or not, the science and data available to us show that we are headed toward serious climate change (and serious damage from that) if we do not take decisive and substantial action over the next 10 years. If we do not act now, there will be severe negative consequences everywhere in the world, including where you live. Your life will be negatively impacted, as will your kids’ and their kids’ lives.
Further, research shows continuously increasing wealth inequality in our society – a few people are getting super rich, while the majority of people struggle to make ends meet. To add to that, wealthy people also contribute more to climate change – the top 1% (people earning over about $100k USD per year or who have around $1 million USD in net worth; population totaling about 78 million) contribute over double the greenhouse gas emissions of the bottom 50% (people earning probably less than $1k USD per year whose net worth is less than $10k USD; population totaling almost 4 billion). The top 10% (people earning over $35k USD per year; population around 780 million) contribute more than 50% of global greenhouse gas emissions. The wealthy, and “wealthy” might include you, are disproportionately harming the world for their own benefit. The poor are also disproportionately negatively impacted by climate change, and this vicious cycle is set to continue without substantial action.
When we look at social change, the picture is not much nicer. We’ve seen increasing violence and racism at an individual, institutional, and systemic level against Black, Indigenous, and People of Colour populations over the last few years as these communities try to assert and establish their rights. Many target identity groups have made major progress, but more people need to be allies in these movements if there is to be systemic and lasting social justice.
Social and environmental value grows and strengthens your community.
Embedding social and environmental considerations into your business is a really easy and effective way to make people even more excited to support you. As we know, that support is critical to your business’s success, especially on Backers. Here’s some data to back that up: according to a Cone Communications CSR Study, 87% of consumers would purchase a product based on a company supporting a social or environmental issue the consumer cares about. The same study said 76% will refuse to purchase a company’s products or services upon learning it supported an issue contrary to their beliefs. A study by the Reputation Institute revealed that 42% of how a person feels about a company is based on their Corporate Social Responsibility (CSR) approach. There is much more data out there.
Social and environmental responsibility doesn’t just boost sales, it boosts a sense of community, customer loyalty, and lifelong customer relationships. The booming success of companies like tentree and 4ocean prove it. The continuously increasing emphasis on social and environmental responsibility in the branding of major corporations such as all the anti-racist messaging we saw this summer (although the branding falls well short of adequate action) show that big companies see this as a way to increase their sense of community, and ultimately increase their profits.
The benefits go way beyond community-building.Further, there are many other research-backed reasons why businesses should be socially and environmentally responsible, AND evidence that they will financially benefit from doing so. A few of the most commonly referenced and studied benefits are:
- Consumers are demanding CSR, meaning that engaging in authentic CSR will increase your sales (the wrong approach can lead to negative performance).
- People want to work at companies with world-positive missions and products, and companies who integrate CSR will recruit and retain better talent.
- Employees deliver more value to businesses when they understand how their work is part of something bigger.
- Companies can foster innovation for new products, processes, and operations by exposing their teams to new markets and creating interactions with users.
- Companies can learn about new markets and gain insights to prosper there by creating opportunities for decision makers to get first-hand experiences in these places.
- Companies can earn new revenue-positive partnerships, especially along supply and distribution chains where there are ample opportunities to build the capacity of these partners.
- Companies can avoid costly legal regulation and lawsuits by prioritizing ethical practices and earning goodwill.
- Companies integrating CSR can increase access to capital by creating opportunities to qualify for funds committed to ESG (environmental and social good) (a rapidly growing opportunity).
- If businesses do not become socially and environmentally responsible, there will be severe negative consequences on their operations and bottom lines from climate change and social inequality.
You can be part of the positive change.
There are many ways your business can have positive social and environmental impacts. There are many ways your business can reduce its negative impacts. So let’s get started thinking about it:
- Understand: Determine what CSR means to your company and how it relates to your overall mission and purpose. In today’s world, it needs to relate, and should be core.
- Evaluate: Look at what your organization is already doing in terms of CSR activities. How is CSR built into your design?
- Research: Find out which CSR issues are most significant to your business. Start by referencing online lists for relevant issues in your sector. Look at the CSR or sustainability reports of larger companies in your industry to see which issues they’re tackling. Go above and beyond what other people are doing so you differentiate as a truly positive business.
- Prioritize: Identify which CSR issues are most important to your customers and stakeholders and deal with those first. Engaging your employees and customers is a great way to get going and gain support.
- Integrate: Your CSR strategy has to become part of your overall business strategy. Don’t think of it as part of your business, but rather, the way you do business.
- Identify opportunities: Having strong CSR credentials can pave the way for new opportunities such as entering new markets, developing niche products and forging strategic partnerships.
- Communicate: Ensure you effectively communicate your CSR activities to your various target audiences through as many channels as possible.
- Finally, read this guidethat gives you a thorough framework and advice on how your business can create and benefit from social and environmental value.
- Read through this guide on creating and benefitting from social and environmental value.
- Do a comprehensive cost-benefit analysis of your business. This should factor in costs and benefits not just to you as an individual, but to other people as well (including your community, other communities, disadvantaged groups of people, people in your town/city, in your country, in other countries, in the world, etc). It should also include costs and benefits to the environment (effects on other non-human animals, greenhouse gas emissions, pollution, climate change, etc). Essentially, think about people and the planet, not just profits.
- Ask yourself: Will your business have a net positive effect? Will it harm certain people or the environment for the benefit of other people?
- Regardless of the current outcome of your cost-benefit analysis, what changes, small or big, can you make that would reduce the costs and increase the benefits of your business? You should make changes at minimum until your business will have net-positive social and environmental consequences from its operations and success.
- Make an action plan to embed these changes into your business. This should have clear timelines.
- Execute on the first action in that plan right now.
If you’re interested in global wealth stats and inequality: https://www.credit-suisse.com/media/assets/corporate/docs/about-us/research/publications/global-wealth-report-2020-en.pdf