How does corporate social responsibility affect any business profitability?
As you scroll through your social media feeds or flip through the television channels, you may notice that many companies have shifted the content of their ads. The goal isn’t simply to sell their products, but rather to also highlight corporate social responsibility. Show It’s a smart move. A recent study on corporate social responsibility shows that 66% of Internet users over the age of 18 think more brands should take public stands on social issues. And 52% of those surveyed indicated that they would spend more money with a brand that aligns with their social values. Moreover, there is evidence that suggests a better return on assets associated with corporate social responsibility. If you’ve been thinking of how to incorporate social responsibility into your company, take a page from history. The concept of corporate social responsibility isn’t new. In fact, you can trace the origins of business humanitarian and social welfare efforts back to the Industrial Revolution. In the 1950s, the term “corporate social responsibility” was coined, and the concept of integrating sustainability, charitability and philanthropic goals into a business’s mission and vision has grown increasingly popular in the ensuing decades. So why should you consider engaging in socially responsible initiative?
Companies that Handle Corporate Social Responsibility WellMost major companies, from Coca-Cola to IBM, have realized the importance of corporate social responsibility, not only for society, but for their bottom line. They do social good well, and it’s paid off. Here are a few companies from which to take notes:
So how can you do good as well as these companies? The key to successful implementation of corporate social responsibility is to align your initiative with the goals of the company:
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How can businesses use CSR to increase profits?High-performing CSR companies attract more loyal customers who are less price-elastic, and therefore the firm is able to charge a premium, which, in turn, increases profit margins and drives more opportunities to expand growth options and invest in product innovation.
Is there a positive relationship between CSR and profitability?The correlation between these variables and CSR performance was examined through correlation and regression analysis. The results confirm that CSR performance has a partial positive correlation with profitability and firm value.
How does corporate social responsibility affect businesses?CSR demonstrates that you're a business that takes an interest in wider social issues, rather than just those that impact your profit margins, which will attract customers who share the same values. Therefore, it makes good business sense to operate sustainably.
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