Corporate Social Responsibility for the Global Business

In a socially-conscious world, employees and customers actively seek out corporate businesses that prioritise some form of social responsibility. Corporations are increasingly expected to affect social change through their internal business practices or with financial donations.

Although valuable elements, corporate social responsibility (CSR) is more than just one-off charitable donations or lending social media support to causes. Mindful business practices need to be holistic and encompass the day-by-day operations of companies.

Environmental efforts are also vital to modern CSR, as is philanthropic or charitable fundraising. For multinationals, it is also important to look internally. How ethical are your labour practices, and how can they be standardised across international locations with varying labour laws?

Not just “nice-to-have” – a must-have

CSR is often thought of a voluntary attribute that acts as a marker of successful company culture – but in some areas, it is legally mandated. In Mauritius, Nepal and India, for example, corporate philanthropy has been signed into law, requiring companies to invest a percentage of profits into charitable or humanitarian initiatives.

Some locations will ask for your CSR plans when you incorporate a company there. The Masdar City Free Zone in Abu Dhabi cites itself as one of “the world’s most sustainable urban communities”. Any prospective branch or LLC wishing to set up in the Free Zone must include detailed information in their business plan about their past and future CSR strategy, in order to align themselves with Masdar City’s vision and values.

The true definition and importance of CSR will vary from business to business. When implementing a new CSR framework, a good starting point is to reacquaint with the core values of the organisation. Refreshing on goals, culture and operational locations can help in building a strategy that makes sense to the business, stakeholders and customers, as well as spearheading lasting change.

Whether the business is building a strategy for mandated or voluntary reasons, there are many sub-areas of CSR that they can consider incorporating to ensure they are acting in a socially responsible way.

Environmental responsibility

Regardless of size or location, all businesses occupy a carbon footprint. Implementing everyday carbon-reducing practices can have a significant effect on a businesses’ carbon output. Small steps such as making a conscious effort to minimise unnecessary road or air travel, increasing the efficacy of office lighting, or adopting environmentally efficient heating systems will make an environmental impact.

Minimising single-use plastic is also an easy step in becoming more sustainable. Plastic waste can be detrimental to ecosystems and reusable alternatives to single-use plastics are becoming more common and accessible.

Digital carbon footprints are becoming an increasing environmental concern for businesses. When companies began to consider the ecological impact of their operations, many thought a simple fix would be to “go paperless” – cutting down on paper usage through reduced printing, and increasing use of email and cloud-based filing. Although this has reduced a large throwaway aspect of office culture, there is still a sizable environmental impact attached to digital storage and use. At present, the carbon footprint from our digital devices is estimated to be on par with the aviation industry and is rapidly growing.

Company websites will carry a carbon burden. The internet consumes about 416.2TWh of electricity per year, more than the total electrical output of the United Kingdom. Using compressed images, efficient file formats, lightweight fonts, and avoiding bloated frameworks on your company website will go a long way to making websites more environmentally efficient.

Companies can also set a page weight budget when undergoing a redesign or setting up new web pages. Tom Greenwood emphasises preplanning when creating a sustainable website, claiming the best results are achieved when website efficiency is prioritised from the beginning of a project rather than as an afterthought. Agreeing on a page weight budget and using it as a metric of project success will put companies on the right path to achieving their environmental goals.

Philanthropy  

As a more traditional form of corporate social responsibility, philanthropy is often included in a company’s broader CSR planning.

Business philanthropy usually involves donating funds or goods to a charitable organisation or social cause. The idea behind corporate philanthropy is that companies make a conscious effort to set aside a proportion of their profits to put back into struggling communities or charitable projects. Many businesses donate to worthy causes while others conduct in-house charitable services, such as research.

This philanthropic effort does not always have to revolve around funds. Donating time and expertise to non-profit causes or organisations can be just as valuable as financial contributions. Hosting charitable events, using influential platforms to raise awareness, or volunteering time or expertise are simple ways to contribute non-financially. Involving staff in aiding local communities or encouraging them to devote time to social causes is also a way to boost corporate philanthropy.

Ethical Responsibility

Organisations exercising ethical responsibility as part of their corporate social responsibility initiatives ensure the fair treatment of everyone associated with their businesses – across their supply chains, customer base and internal staff.

Some companies might implement policies that go above and beyond statutory employee benefit requirements in that country – for example, Bank of America announced in 2019 it would raise its minimum wage to 20 USD an hour over a two year period as part of “the company’s commitment to being a great place to work and delivering sustainable, responsible growth.” Others might set in place strict audits of their suppliers to ensure their products and services are created in an ethical manner.

Economic Responsibility

Economic responsibility within CSR means prioritising societal and environmental wellbeing alongside profits in financial decision making. While companies need profits to survive, an economically-conscious brand will ensure profits are never made at the detriment of the society in which they operate.

Adventure clothing brand Patagonia is a leader in global CSR and economically responsible decision-making. Their self-tax initiative 1% for the Planet redistributes 1% of their sales to fund international grassroots environmental projects.

Where should global companies focus their CSR?

Much discussion has been had about where a multi-national company should position their corporate social responsibility efforts. Should they try to address societal issues in the countries in which they operate, tackling individual projects specific to those regions? Some feel this is a more appropriate approach, in that companies can make a difference to locations where they have utilised local resources to reap a financial benefit.

Or should they view themselves as “citizens of a global society”, with a responsibility to tackle wider global problems (such as climate change) that might exist more broadly beyond their operational locations? We are increasingly aware of the interconnected nature of our planet, and the manner in which the Global North often gains at the detriment of the Global South – some argue that multi-national businesses therefore have an obligation to the world as a whole.

Ultimately, the answer to this question lies in the feeling and culture of the global organisation themselves – beyond mandated local requirements. Whether they decide to approach CSR from a localised or globalised perspective, they must be sure that their efforts are effecting real change, and are not simply performative tick-box exercises.

If you’re considering global expansion and want to know which mandated or voluntary CSR initiatives apply in your target countries, get in touch here.

Why not support our own CSR initiative too? Throughout the month of June, Mauve Group is running its #MauveGoesGreen challenge in support of global animal welfare charity, World Animal Protection. Keep an eye on our social channels for the team’s efforts.