Sustainability may then be defined as maintaining well-being over a long, perhaps even an indefinite period. This covers largely the environmental dimension of the triple bottom line, but environment and sustainability are not synonymous. On the one hand, some forms of environmental degradation are both relatively easily reversed and highly noxious in the present many forms of air and water pollution, for instance.
Corporate social responsibility (CSR) refers to both managerial practices focused on welfare creation as per Brown the definition of CSR is the obligations of businessmen to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society.
The Modern definition of corporate social responsibility (CSR) is a self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public. By practicing corporate social responsibility, also called corporate citizenship, companies can be conscious of the kind of impact they are having on all aspects of society, including economic, social, and environmental. The term corporate social responsibility (CSR) refers to practices and policies undertaken by corporations that are intended to have a positive influence on the world. The key idea behind CSR is for corporations to pursue other pro-social objectives, in addition to maximizing profits.
Benefits:
CSR presents new business opportunity
Responding to the social challenges and risks of the modern world can open up new opportunities for businesses in emerging markets. The following example shows how.
Ambuja Cements is an India Subsidiary of the global building materials company Holcim. In 2010, Ambuja organized several plant-level social and environmental responsibility programs, which included improved water management in drought-prone areas. This minimized the impact of Ambuja’s operations on local communities.
One such program was a water recharge plan. Ambuja worked to reserve water from its operations, to support drought-prone communities. This created a water surplus which was then used to replenish groundwater systems, transforming arid wasteland into land suitable for farming. Ambuja was able to offer farmland in exchange for new mining terrain.
CSR creates a positive brand image
By helping people, CSR creates a positive brand image, and from this, business sales and revenue are boosted.
The global coffee franchise, Starbucks, has long been known for its keen sense of CSR and commitment to community welfare. For instance, in 2021 the Ethisphere Institute named Starbucks as one of the World’s Most Ethical Companies for the 15th year running.
According to Starbuck’s 2020 Global Social Impact Report, the business aims to:
- Obtain 100% of its coffee from ethical sources,
- Create a global network of farmers and supply them with 100 million trees by 2025,
- Support green building infrastructure throughout stores,
- Contribute to millions of hours of community service,
- Create a groundbreaking college program for employees,
- Hire 5,000 veterans and 10,000 refugees.
CSR manages business risk
Ignoring social responsibility is a risky business. The 2013 Dhaka garment factory collapse gives a heartbreaking and chilling reminder of this fact. On the 13th of May 2013, an eight-story high commercial building named the Rana Plaza collapsed killing 1,124 and injuring approximately 2,500 people. The disaster was considered the deadliest, non-deliberate accident in modern human history, and was the result of a structural failure.
The Rana Plaza housed clothing factories, a bank, and several shops. The owners of the building ignored warnings of cracks developing in concrete walls, showing a disregard for the lives of the employees working inside.
Brands linked to the factory included Mango, Matalan, Primark, Benetton, Bonmarché, H&M, and The Children’s Place. These brands faced worldwide criticism and consumer backlash after the crisis.
CSR creates a happy and productive workforce
Looking after employee health and wellbeing is an important aspect of CSR, and there’s increasing evidence indicating happy workers are productive workers.