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What Is Corporate Social Responsibility (CSR)? | Business: Explained

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  1. Businesses have historically operated in pursuit of a single goal, maximizing profit.
  2. Yet, over the past several decades, that's changed. Many business leaders have come to recognize
  3. they have a responsibility to do what's best not just for their companies but for people,
  4. the planet, and society. This idea is known as Corporate Social Responsibility, or CSR,
  5. and it's led to the emergence of companies that carry socially responsible designations, such as B
  6. corporations, social purpose corporations, and low profit limited liability companies.
  7. What corporate social responsibility means varies depending on an organization's goals.
  8. At its core, it's a form of self-regulation expressed in initiatives and strategies.
  9. Firms are often guided by a concept called the triple bottom line.
  10. It dictates that rather than focusing solely on financial performance, businesses
  11. should measure their impact on the three P's, profit, people, and the planet.
  12. Corporate social responsibility is traditionally broken into four categories, environmental, philanthropic,
  13. ethical, and economic. Environmental responsibility is the belief
  14. that organizations should behave as environmentally friendly as possible.
  15. Ethical responsibility is concerned with ensuring companies operate fairly.
  16. Philanthropic responsibility refers to businesses aims to make the world better and improve
  17. society. Economic responsibility is the practice
  18. of firms rooting financial decisions in a commitment to do good.
  19. No matter the type, organizations that embrace corporate social responsibility
  20. can reap several benefits. For example, CSR can be a powerful marketing tool
  21. that enables companies to position themselves favorably in the eyes of consumers, investors, and regulators.
  22. CSR efforts can also improve employee engagement and satisfaction, key measures that drive retention.
  23. What's more, it can help attract job candidates with personal convictions that match
  24. those of the organizations they apply to. Pursuing CSR also prompts business leaders
  25. to examine how they hire and manage, source products and resources, and deliver value to customers.
  26. Such reflection can lead to more socially responsible actions, which in turn enables their firms to address
  27. the world's most pressing problems while succeeding financially.
  28. If you want to understand what it takes to reap the benefits of CSR
  29. and combine purpose and profit, explore our online course sustainable business strategy and discover
  30. how you can become a purpose driven leader.

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