What is corporate social responsibility and how does it work in small businesses?

May 1, 2017 | Good Management

Many small business owners perceive the term ‘corporate social responsibility’ to be about big business, not about them. But aside from the terminology, CSR is basically about businesses of any size behaving in an ethical, responsible manner.

This can manifest itself in many ways, but it isn’t about donating large sums to charity, it’s about behaviour and decision-making across all areas of your business. Any even the tiniest organisations can do that.

The same issues and ways in which a business can behave responsibly apply to big and small businesses alike, however how they are addressed, on what scale and with what practical impact will vary. Here are some things you can look at to be a responsible business.

Your community

Consider the impact your business has, or could have, on your local community? Are you a responsible member of the community where you are? Are you a good neighbour to businesses and residents? For many small businesses involvement in the local community is crucial anyway, for marketing reasons – if the local community is your customer base, you undoubtedly already understand the value of getting involved –it raises your profile and impacts your profits.

But even if the local community isn’t where you source your customers, getting involved on some level is a responsible thing to do. Taking part in local events and activities, fundraising for local causes and encouraging staff to volunteer in local charities are all ways you can be socially responsible in your community.

You as an employer

Do you think you’re a good employer? For many small businesses, being a good employer makes business sense. Difficulties (and the expense of) recruiting good quality skilled staff means that holding on to the workers you have is vital. The cost of high absence rates means that initiatives to look after staff and promote a healthy workforce are cost-effective and sensible rather than just a- nice to have’.

Forward-thinking small businesses understand the business benefits of being a good employer and retaining good staff, and the fact that looking after staff welfare is a socially responsible thing to do is just a bonus.

Some small businesses may perceive looking after staff as being expensive and therefore a luxury. But actually, as well as bringing tangible business benefits, it doesn’t have to cost a lot. For many small businesses, offering generous benefit packages isn’t something they can do. But any small business can look after staff in cost-effective ways. Giving staff control, flexibility, development opportunities, recognition and support can all be very low-cost, but can add a great deal to how your staff feel in the workplace, how likely they are to stick with you and how much they’d recommend you to potential recruits.

Looking after your environment

In the same ways as looking after staff doesn’t have to cost a lot, being environmentally responsible doesn’t need to be expensive either. Things like re-using and recycling and looking at energy efficiency can reduce your costs and therefore improve your profit margins, as well as being the- right’ thing to do.

Your supply chain

Even the smallest business can keep an eye on their supply chain. Do those organisations supplying you with goods and services behave in a responsible way? Do they pay staff fairly and treat them well? You may feel that unlike a giant corporate, you don’t have much- sway’ over the behaviour of those supplying you, but the responsible thing to do is to inform yourself of what goes on and make sure purchasing decisions are made with your eyes open.

Ultimately, corporate social responsibility is about good business practice. It’s not a fluffy way of big businesses feeling better about themselves, it’s about paying attention to what you’re doing, and thinking about decisions you are making, which any business can do.

And it doesn’t take too much thought or digging to realise that good business practice brings real tangible benefits and improves your profitability, so it’s worth any business owner spending some time on just for the commercial impact alone.

If you’d like to find out more about coporate social responsibilty do get in touch.