CSR is designed as a specific tool to achieve specific goals.
While a person or a group usually sets up a company in the hope of earning good returns from it. Over the time, this idea that simply making profits is enough has lost traction among people. And thus, it is no longer sustainable for businesses to buy and sell products and services without considering the world in which they operate. Businesses must pay attention to the social and environmental concerns around them.
To achieve this, companies began following preset guidelines that they categorised under “Corporate Social Responsibility ”, or CSR. The term first came into common use in the late 1960s and early 1970s, along with the term stakeholders, which means those on whom the company or its activities have an impact.
Corporate Social Responsibility
The United Nations Industrial Development Organization defines CSR as a business management concept through which companies integrate social and environmental concerns in their operations and interactions with their stakeholders. CSR is generally understood as a way through which a company strikes a balance among economic, social and environmental imperatives.
Is it really different from charity or philanthropy?
In some ways, yes. While both are aimed at the public good, CSR is different from philanthropy or charity in the sense that it is part of a business strategy. When a company chalks out its CSR policy, it affects its business operations, supply chains, and human resources. The company’s philanthropic work may not affect its other verticals.
CSR is designed as a specific tool to achieve specific goals – such as encouraging a positive impact on the environment, consumers, employees, communities, stakeholders and all members of the public.
CSR is ultimately a business model by which companies work to enhance rather than degrade society and the environment. CSR helps a company improve its image and at the same time, it is helping society.
How does CSR help build brand image?
Many companies believe, and rightly so, that their customers will do business with them if they come out as ethically solid. In this sense, CSR activities also help as a tool for public relations. On the other hand, some companies engage in CSR because the people behind them are highly motivated to achieve the public good.
