In 1953, Howard Bowen published his landmark book, The Social Responsibilities of the Businessman. This constitutes a starting point since which CSR, or Corporate Social Responsibility, has entered the mainstream business agenda. During one of my Corporate Communications classes we explored this vital aspect of public relations, communications and corporate public image in detail. Why is it so important and what does it do for companies? I decided to dig deeper.
There are numerous definitions of CSR. In 1953, Howard Bowen proposed the definition of CSR as “the obligations of business 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” (Bowen, 1953). Recently, the term has evolved and is sometimes used interchangeably with sustainability (although the two concepts differ), which is defined as “a new and evolving corporate management paradigm.(…) Corporate sustainability is an alternative to the traditional growth and profit-maximization model. While corporate sustainability recognizes that corporate growth and profitability are important, it also requires the corporation to pursue societal goals, specifically those relating to sustainable development — environmental protection, social justice and equity, and economic development.” (Wilson, 2003).
As the times develop, so has CSR. The practice as such could be traced back to late 19th century (see the Cadburys example below). However, one of the most famous examples dates back to 1914, when Henry Ford doubled the standard rate of pay in his bold move to improve working conditions of employees. He believed that good relations with workers bring great business results. His motives? Ford wished for his workers to be able to afford their own cars. Why? It’s great for the economy.
There are a couple of similar examples. The Lever brothers (fathers of what later became Unilever) built their Port Sunlight village in 1888, intended to be populated by their workers. Similarly to that, Cadburys created a Bourneville village next to Birmingham in 1879, also intended for their employees.
Therefore, although by no means new, CSR has been constantly rising in importance over the recent years and now has become an indispensible element of successful and ethical companies. To understand how it works in practice, it’s useful to take a closer look at Unilever, one of the most ethical and sustainable companies in the world. The are well known not only for the range of various products they make, but also for the deep commitment they have for sustainability and CSR.
It’s important to ask why CSR has moved to the centre of the communications stage. I think there are 3 major reasons for this state of events.
- CSR and sustainability enhance company trust in the era of inreased ecological awareness. It displays long term thinking and shows a corporation aims higher than just for mere profits. CSR is a name card for being responsible and rational.
- CSR prompts innovation. Since all major companies have to show what they do for the ‘greater good’ of Mother Earth, competition as to how much is being done takes place. It’s not good enough anymore to do as little as required by law about charity work or environmental protection. Innovators and leaders in this regard get the prize.
- CSR helps in brand differentiation. The more socially responsible you are, the more people notice you, the more they respect you and the more they can tell you apart from ‘all the other ones’.
Be careful though! Much has been written on how PR is behind every sustainable and responsible company. This may be true to some extent and in some cases. I think that a right balance needs to be applied in order to ensure the CSR efforts are genuine. What one says needs to match up to what they do. If you don’t practice what you preach and you attempt at CSR just to gain mere popularity… stop right here. In order for CSR to be successful, genuine intentions are needed. More – they are indispensible!
Featured image: HERE
Bowen, H. (1953). Social Responsibilities of the Businessman. University of Iowa Press: Iowa City.
Singh, A. (2011). Behind Every Responsible Company . . . Is a P.R. Agency. Available from: http://www.forbes.com/sites/csr/2011/08/31/behind-every-responsible-company-is-a-p-r-agency/#738f44532e5d
Wilson, M. (2003). Corporate Sustainability: What Is It and Where Does It Come From? Ivey Business Journal. March/April. Available from: http://iveybusinessjournal.com/publication/corporate-sustainability-what-is-it-and-where-does-it-come-from/