As part of a family business, it is often easy to become isolated from the rest of the world, especially if your company does not directly interact with customers. It is all too easy to lose yourself in the day-to-day job until you find yourself doing the same thing decades down the road. There’s nothing wrong with that, of course, if you love your work. However, as the saying goes, no man is an island. Everything you do, whether personal or professional, is bound to create a ripple and an impact somewhere else. A Corporate Social Responsibility plan can help address that issue.
WHAT IS CORPORATE SOCIAL RESPONSIBILITY (CSR)?
Corporate social responsibility (CSR) is a company’s commitment to managing the social, environmental, and economic effects of its operations responsibly and in line with public expectations. In plain words, it is the responsibility given to each private company that they should give back to the community in whatever way they are able.
CSR is a management concept where companies integrate social and environmental concerns in their business operations and interactions with their stakeholders and the public. By practicing CSR, also called corporate citizenship, companies can be conscious of the kind of impact they contribute to all aspects of society, including economic, social, and environmental.
Admittedly, image is everything nowadays. If your company genuinely loves to help and give back, that is all well and good. The majority of global brands do more harm than good when it comes to social, economic, and environmental impacts.
To engage in CSR means that a company is operating in ways that enhance society and the environment, instead of contributing negatively to them. Is a company required to have a CSR? There are no legal mandates for it yet, but a CSR plan benefits the community and the company’s branding.
EXAMPLES OF CSR PLANS
A CSR plan can depend entirely on a company and its management. Some customize theirs to benefit the people in their industry better, while others try to reach out beyond their circle and be more community-driven. Some examples of CSR in action include: Reducing carbon footprint, engaging in charity work, purchasing fair trade products, doing charity work, investing in environmentally conscious businesses, getting involved in volunteer work, and improving labor policies.
Though they are not obliged to do so, a company’s CSR allows the public to ask for accountability from corporations who might otherwise take advantage of the community’s resources. In recent decades, there has been a rise in the trend of huge companies and industries contributing to more than half of the source of pollution and the reason for climate change. Without a CSR plan, some brands might take advantage and not adhere to community rules even though they are not violating any legal law.
FAMILY BUSINESSES CSR
Ford
Ford’s mission has always been to “build a better world, where everyone is free to move and pursue their dreams.” From an original $11B investment, they have have increased to $22B for electrification and for their manufactured vehicles to be carbon neutral by the year 2050. This is a huge undertaking for such a globally popular car brand. According to their executive leaders, this is their main corporate social responsibility to their customers and to the planet.
Apart from this ambitious promise, Ford also tries to focus on pay equity for all of their employees. They regularly conduct a diversity, equity, and inclusion audit while introducing a global salaried pay ratio (including gender) to level the playing field for all employees.
BMW
Another one of the world’s biggest brands when it comes to automobiles is holding up their end of the bargain in terms of CSRs. The automobile company invests a lot on sustainable work practices, they promote diversity in education, and they have inclusive programs and incentives all over the world. One of their most notable CSR initiatives? The BMW Children’s Traffic Safety Education. It is an expert program that teaches road safety in China and aims to improve road safety awareness.
BMW is actively trying to educate children about road safety and responsibility so that it is integrated into them by the time they are legal to drive. When it comes to their employees, the automobile company also improved their labor codes. Their staff earns above-average wage, allowed to work flexible hours, and receives top-notch employee education and training.
Ikea
Home furniture company IKEA has made their own efforts to improve their CSRs. For years now, they have supported local communities after a crises, helped build schools, and donated thousands of toys to less fortunate children. They also pledged $2.3M to help provide and bring clean electrify to over one million people in India and East Africa.
EXAMPLES OF CSR
A CSR plan can depend entirely on a company and its management. Some customize theirs to benefit the people in their industry better, while others try to reach out beyond their circle and be more community-driven. Some examples of CSR in action include: Reducing carbon footprint, engaging in charity work, purchasing fair trade products, doing charity work, investing in environmentally conscious businesses, getting involved in volunteer work, and improving labor policies.
Though they are not obliged to do so, a company’s CSR allows the public to ask for accountability from corporations who might otherwise take advantage of the community’s resources. In recent decades, there has been a rise in the trend of huge companies and industries contributing to more than half of the source of pollution and the reason for climate change. Without a CSR plan, some brands might take advantage and not adhere to community rules even though they are not violating any legal law.
FAMILY BUSINESS & CSR
Many businesses believe that consumers will be more likely to do business with brands that they perceive to be more ethical. In this sense, CSR activities can be an important component of corporate public relations. At the same time, some company founders are also motivated to engage in CSR due to their convictions.
CSR has had many domino effects. For example, many companies have taken steps to improve the environmental sustainability of their operations. Installing renewable energy sources or purchasing carbon offsets are some of these steps. Efforts have also been taken to eliminate unethical labor practices, such as child labor and slavery.
While CSR programs are important to all businesses, they are even more important for family businesses. Family Businesses are focused on the next generation, not the next quarter. Therefore, they have the additional motivation to create a better world for their family members and family business employees. There is even a more selfish reason for a family business to have a strong CSR program. The most important objective for almost all family businesses is for the next generation succeed to the next generation. One of the least discussed selling points for a NxtGen to enter the family business is that it serves as a platform to support the breadth of the family’s interests and their own interests. A strong CSR policy demonstrates that the family business recognizes the needs of the NxtGens but serves as the springboard to accomplish all of their goals whether it’s regarding CSR or other areas of interest.
