Environmental and social factors as the building blocks of a sustainable business are no longer the preserve of the corporate world. Consumers everywhere are demanding that all companies ramp up their focus on pursuing achievable and good long-term goals – for their people and the world at large.
According to GreenBiz, Gen Z and millennials are more greatly concerned with global challenges that previous generations: “Born in the digital age, these generations are seen to be more health-conscious, socially aware and environmentally responsible.”
That is why many successful businesses are embracing environmental and social responsibility – to give back to society and thank customers for their loyalty. This can take the form of projects, movements, or individual empowerment, and is undeniably beneficial to both the business and the community.
The crucial point of sustainability is that businesses need to take it seriously because it is not only about the social and environmental factors, but also about the long-term resilience of the business model.
There are three key reasons why SMBs should prioritise social and environmental responsibility:
1. To attract and retain employees
Having social and environmental strategies in place demonstrates that a company has compassion and that it cares about treating people well.
The Secret Power of CSR, a GoodUp research report into the relationship between corporate social responsibility and employee engagement, found that the pressure to embrace corporate responsibility doesn’t come just from external sources (customers, politicians, media) but increasingly from employees as well.
A business that is committed to improving the world is likely to attract more talent. This is also more likely to help create a productive and positive work environment for employees. A high level of employee engagement leads to growth in productivity, loyalty, customer satisfaction and revenue.
2. It improves customers’ perception of a brand
Being a socially responsible company can bolster a company’s image and build its brand. GoodUp found that customers increasingly demand social responsibility from businesses: it’s no longer a “nice to have” – it’s a “must”. Businesses that take social responsibility seriously set themselves apart from the competition and can win customers, as well as develop a platform to earn the attention of their target markets.
This can help people view your company as a positive force in society, one that can raise awareness about important causes. The business is seen as a trusted entity, and this creates loyalty on the part of customers. For that loyalty, customers expect the business to not be all about making a profit, but to also give back to society. That’s why GoodUp reports that the position of CSR within organisations is shifting from charity towards being an integral part of a company’s sustainable development strategy.
3. Reduce costs and save money
Environmental and social responsibility requires investment in projects, so it is not usually seen as a strategy that helps to improve the bottom line. But because customers are willing to pay more for products from a socially responsible company, and because employee turnover is likely to be reduced, it can actually deliver bottom line benefits.
That is why many companies are adjusting their business strategies in order to create a positive impact on society and the environment.