Advantages of Social Responsibility in Business By Amos Chung Rong Xian

Advantages of Social Responsibility in Business

By Amos Chung Rong Xian

November 18, 2019

The main goal of a business is to provide value to their customers and make profits at the same time. However, many companies nowadays also integrate social responsibility into their businesses. The purpose of social responsibility in business is to give back to the community and make positive impacts on society. Besides social contributions, businesses also benefit from adopting social responsibility. There are several advantages to social responsibility in business.

First, companies can generate publicity through social responsibility. Social responsibility provides companies the opportunity to share their positive stories online and through mainstream media which can then generate organic publicity and word of mouth marketing. This allows them to spend less on expensive advertising campaigns (van der Lingen, nd). Companies can send out a press release or invite media coverage of their genuine social activities. Contributing actively in communities often helps companies to attract media attention (Kokemuller, 2017). Business is usually not a popular topic for others, however, company events that involve society or the environment can be much more interesting for the public to engage (Mardistas, 2017).

Second, businesses can create product differentiation with social responsibility. Product differentiation allows businesses to have a different selling point over their rivals (“How CSR Can Help Your Business,” nd). Socially responsible behaviors or charitable giving helps businesses to differentiate their brands from competitors. Companies could be known as the industry provider that supports social causes (Kokemuller, 2017). Engaging in social investment can help companies to build a good reputation which allows them to gain a competitive edge. Other companies also prefer suppliers with responsible practices because this can reflect on how their customers perceive them (“Corporate Social Responsibility,” nd).

Third, social responsibility can increase the customer loyalty of a business. A strong record of social responsibility can improve the attitude of customers towards the company. Customers are more likely to buy products or services from the company that they like and trust (van der Lingen, nd). Companies that embrace socially responsible policies can attract and retain more customers, which is important to the long-term success of any company. Many customers are more willing to pay a higher price for services or products when they recognize that part of the profits will be channeled towards nearby social causes. Companies will also increase their foot traffic when they enhance the local community (Murphy, 2019).

Fourth, social responsibility can achieve cost savings for businesses. Companies can minimize their negative impact on the environment by adopting socially responsible practices that allow them to lower their cost of operation (“What Are the Benefits of Adopting CSR?”, 2017). They can reduce resource use, waste, and emissions to help the environment and save money at the same time (“Corporate Social Responsibility,” nd). Reducing the use of energy and fuel allows companies to lower their bills (“How CSR Can Help Your Business,” nd).  Companies can also further reduce costs by implementing energy-saving programs and spending less on traditional advertising (van der Lingen, nd).

Fifth, socially responsible companies can attract quality employees. Social responsibility is a crucial component for a company to become an ideal employer for top candidates (“What Are the Benefits of Adopting CSR?”, 2018). Companies that focus on social responsibility can attract candidates who share the company’s mission instead of just focusing on the financial benefits (Lando, 2019). Many talented employees are keen on making a difference in the world in addition to simply receiving salaries (Murphy, 2019). A good social responsibility framework can help a company to become more attractive to potential future employees who are looking for a meaningful career (Muir, 2015).

Sixth, social responsibility can also help companies to retain employees. Companies that adopt social responsibility can create a more positive working environment (“What Are the Benefits of Adopting CSR?”, 2018). Many employees preferred to stay with a company that has a healthy sustainability plan. Companies with the ability to retain their employees can save the financial cost and human capital required to hire, onboard, train, and terminate employees. There is a huge reduction in employee turnover when employees are engaged in the social responsibility programs of their companies (Lando, 2019).

Seventh, social responsibility can help businesses to improve their employee engagement. Employees like to work for a company that promotes good cause because they can be proud of their company and their work. Stronger employee engagement allows companies to form better relationships with their employees (Mardistas, 2017). Companies have to enlist the support and involvement of their employees to be successful in their social responsibility initiatives. They must keep their employees update on their social responsibility strategies (Simmons, 2018). Many employees would like to know how their companies are engaging in social responsibility and how they can be involved too. The driving force of job performance and satisfaction is a sense of purpose. Employees that are engaged in their workplace will gain a sense of purpose in their work. They will provide a higher quality of work for their companies and a better quality of product or service to the customers (Lando, 2019).

Eighth, social responsibility provides opportunities for personal and professional development. Companies can encourage employees to learn new skills outside their work by getting their employees involved in socially responsible activities. These skills can then be applied in the workplace to increase productivity and creativity. Employees can enrich their own perspectives when they have the chance to learn new things and contribute to causes that they feel passionate about. Companies can encourage personal development for their employees by supporting socially responsible activities (Muir, 2015).

In conclusion, businesses should have responsibility for society and not just their shareholders. Social responsibility is now seen as an investment, part of corporate strategic management and a source of creativity rather than an extra cost. Many companies have successfully integrated their social responsibility programs and acquired both economic and social benefits. Therefore, every business owner should start adopting social responsibility in their business. However, there are still challenges remains for companies to start adopting social responsibility. Thorough planning and careful execution are required to ensure success in corporate social responsibility (Essays, 2018).

Reference List

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Essays, UK. (2018). Corporate Social Responsibility Advantages. Ukessays.com. https://www.ukessays.com/essays/management/corporate-social-responsibility-a-superior-competitive-advantage-management-essay.php?vref=1

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Mardistas. (2017). Importance of Corporate Social Responsibility for Companies. Mardistas.com. https://www.mardistas.com/importance-of-corporate-social-responsibility-for-companies/

Muir, S. (2015). Top 5 Benefits of Corporate Social Responsibility. Cubegroup.com. http://cubegroup.com.au/top-5-benefits-of-corporate-social-responsibility/

Murphy, C. B. (2019). Why Social Responsibility is Important to Businesses. Investopedia.com. https://www.investopedia.com/ask/answers/041015/why-social-responsibility-important-business.asp

Simmons, D. (2018). Advantages of Corporate Social Responsibility: How a Blood Drive can Inspire Employees. Imatrix.com. https://imatrix.com/blog/corporate-social-responsibility/

van der Lingen, S. (nd). What is Corporate Social Responsibility? Csrinpractice.com. http://www.csrinpractice.com/what-is-csr/

What Are the Benefits of Adopting CSR? (2018). Rg-group.co.uk. https://rg-group.co.uk/what-are-the-benefits-of-adopting-csr/