The Importance Of Companies Giving Back To The Community

*This is a collaborative post on the importance of companies giving back to the community

A lot of companies out there say that they prioritise people and the environment, but for some, it can be empty words. Profits and growth are important to companies in today’s fast-paced world, but many are recognising the importance of giving back to the community. And it’s becoming of rising importance to consumers as well.

Corporate social responsibility (CSR) is a key element of successful business strategies and weaves into the narrative of many companies.

What is CSR?

CSR refers to a business’s approach to taking responsibility for its impact on society and the environment. It usually integrates environmental, social and ethical considerations and some companies prefer to use the acronym ESG (Environmental, Social, Governance).

Ultimately it goes beyond the traditional focus on profitability and focuses on ways to contribute to sustainable development and the well-being of society. Many of these actions are voluntary initiatives to fulfil responsibilities towards employees, customers, consumers, stakeholders and the environment. For example working towards being net zero, being a diverse employer and having ethical business practices all come under CSR.

While the main goal for any actions in this area isn’t profitability, sometimes it can come as a secondary benefit. The initiatives will vary depending on a company’s industry, size and location. Companies may have a Charitable Donations Programme as a way of giving back through project work or charities. They may have environmental goals to help reduce carbon emissions and make the world a better place.

Why giving back to the community is important

It fosters employee retention and is a positive for new recruits

How a company is giving back to the community and the wider world is important to a lot of employees. Having a comprehensive CSR strategy and taking action will be important to both employees within a company, but also to potential new recruits.

Employees are more likely to feel pride working for an organisation that positively impacts the community. And every business wants to retain the best talent within their business. Current employees are the best advocates for your business, especially when it comes to new recruits. When I was last looking for a new role seeing their CSR strategy and what they were doing in the community was really important for me.

It builds a positive reputation

Companies that are actively giving back to their communities will build a positive reputation, enhancing their brand image. When a company shows that they care and are doing things to benefit the wider world, even if it doesn’t make them extra money it’ll gain the trust of employees, customers and other stakeholders.

In my previous work, I worked in the investor space a fair bit and we were always being told that investors and shareholders wanted to know more about our CSR strategy and what we were doing. They didn’t want to be investing in a company that wasn’t making the world a better place.

Giving back to the community builds relationships

By giving back to the community, companies can strengthen their relationships with local authorities, organisations and residents. Working with local authorities and organisations can lead to mutually beneficial partnerships which can be a win-win for the community and business. For example, if a company is seen in a negative light and not doing good things for the world then residents could oppose a business expansion or new development.

Having an active involvement in the community will allow businesses to understand the specific needs and challenges of the community which could drive them additional business as a secondary impact. But again this shouldn’t be the sold reason for community outreach and relationships.

Addressing sustainable development

The environment has changed so much over the past few decades and companies play a vital role in addressing sustainable developments. There are lots of different things that can be done to become more sustainable from running sites on renewable electricity, developing a sustainable supply chain, or protecting the local environment.

There are a lot more elements to being sustainable than this, but I’m no sustainable expert. Ultimately in the way that people at home should be trying to live a more sustainable life through things like recycling products, reducing waste and investing in renewable energy, businesses should be doing this on a much larger scale.

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