Extract
Corporate Social Responsibility (CSR) represents a modern and strategic vision of business management that goes beyond simply generating profits. By adopting a more active stance regarding their positive social and environmental impact, companies can fulfill their community duty while improving their positioning in an increasingly competitive, conscious and demanding market.
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What is Corporate Social Responsibility?
Currently, companies face a transformation regarding the expectations of their role in society. For much of the 20th century, the primary objective of organizations was to maximize profits. However, today, this view is outdated. Consumers, investors, workers and society in general demand that companies actively get involved in community challenges.
Corporate Social Responsibility (CSR), in its most comprehensive vision, is based on the search to generate a positive impact on the environment where it operates through conscious and responsible business activities. To achieve this, there are four fundamental pillars:
Guarantee the profitability of the business with a responsible operation that promotes the personal well-being and the personal and professional growth.
Efficiently manage resources and minimize the environmental impact of operations.
Comply with ethical and regulatory standards in all business practices, operating with transparency and responsibility.
Link with the community by supporting initiatives that contribute to the growth and progress of the areas where it operates.
At a business level, new generations like Millennials and Z seek to work in places that contribute to the common good and not only generate profitability; being so that those companies that generate a positive impact are more likely to attract and retain talent with technical and human quality.
Also, at a societal level, governments and investors are redirecting support and funds towards organizations that have clear environmental, social and governance (ESG) criteria; being so that those companies that seek to positively influence their environment can access more opportunities and build a positive image of formality in their operations..
1. Business Perspective: Achieving Profitability with a Responsible Operation
A responsible operation consists of adapting operations so that they are responsible with the environment and with the community. This commitment not only responds to a social requirement, but also generates tangible benefits such as reduced operating costs, access to new markets and building a positive reputation.
To achieve this, organizations must not only comply with laws and regulations, but also make decisions that promote well-being, equity and respect for people. Some key aspects of responsible operation include:
Ensure that all employees work in safe and healthy environments, with fair wages and a proper work-life balance.
Have reliable information available on business decisions to access when necessary only by those who should have access to it.
Only work with suppliers who comply with ethical and labor standards on par that minimize the negative impact of their operations on their environment.
Finally, responsible companies are those that see social well-being as an extension of their business purpose and activity.
2. Environmental Perspective: Manage Resources Efficiently
Managing resources goes beyond the efficient use of energy, and the reduction in carbon emissions and water consumption; involves finding ways to regenerate and restore the resources used to give a “second life” to materials, thus contributing to the creation of a more responsible production system.
To achieve this, companies have begun to adopt the circular economy model, which unlike the traditional "extract, produce and dispose" model, is based on restarting product life cycles, promoting “reuse, reuse and recycle” to minimize waste production. Some actions that companies can take regardless of their size include:
Design products thinking about their durability and reuse; Thus, modular products can be created with durable materials that allow easy repair and/or updating.
Maximize recycling and material recovery in used or leftover products from the production processes, thus reducing the need to use “virgin” raw materials.
Optimize processes and eliminate waste in all stages of production, from obtaining resources to distribution of the final product.
This approach not only protects the environment, but also offers economic benefits to encourage innovation, improve operational efficiency, reduce costs and add value to consumers who value sustainable products.
3. Social Perspective: Comply with Regulation
Compliance, as its name indicates, implies that companies comply with applicable laws, regulations and standards in order to protect the rights of individuals and the environment. This includes labor, tax, environmental, computer issues, among others.
To achieve this, companies must go beyond minimal regulatory compliance and seek to do things well, even though the regulations are outdated or insufficient. Some areas of compliance that are becoming increasingly important due to increased globalization include:
Guarantee fair work, equal opportunities and optimal working conditions, which include clean, safe and reliable places.
Establish internal control mechanisms to ensure that internal procedures are met under applicable regulations and standards.
Minimize and control risks that put business continuity at stake.
Thus, regulatory compliance is not an option, but rather a necessity to protect reputation and ensure business continuity.
4. Governance Perspective: Making Decisions Ethically and Transparently
Good corporate governance (GGC) refers to the system by which companies are directed and controlled. Good governance ensures that decisions are made transparently, responsibly and in the best interests of all interested parties, including shareholders, workers, customers and the community.
To achieve this, companies must overcome mistrust inside and outside the organization in order to avoid power games, especially in the context of family businesses, and thereby achieve real alignment and consensus on strategic objectives and ways to achieve them. Some good governance practices include:
Share the real situation of the company publishing commercial, operational and financial results clearly and accurately.
Hold leaders accountable for their decisions and actions, recognizing errors and taking the necessary measures to avoid similar situations in the future.
Ensure fair and dignified treatment for all stakeholders and promote an inclusive culture that allows all employees to contribute to the organization's growth.
Governance involves promoting a business culture based on ethics and integrity to ensure that business decisions are made fairly and equitably. Furthermore, an inclusive company is not only more competitive, but also builds a richer and more dynamic organizational culture.
Integration of CSR into Corporate Culture
The integration of CSR into corporate culture is a continuous process that requires commitment from all levels of the company. This means that every member of the team, from partners in senior management to rank-and-file workers, commits to acting responsibly and adopting ethical and sustainable practices.
Thus, top management must establish a vision and mission that include a commitment to sustainability, compliance and good governance so that CSR becomes an integral part of business culture.
Subsequently, they must create the mechanisms and train the organization on responsible, ethical and sustainable practices so that each person understands how their actions contribute to the fulfillment of CSR objectives.
Finally, establishing indicators and periodically measuring the impact of CSR policies in the organization will allow us to identify areas of improvement and adjust strategies as necessary to achieve a positive impact on our environment and community.
Conclusion: Towards a Comprehensive Corporate Responsibility Strategy
Corporate social responsibility (CSR), based on sustainability, compliance and good governance, is more than a trend. It is a strategy that allows companies to create a positive impact and build trusting relationships with all stakeholders by genuinely committing to sustainable development, regulatory compliance and respect for communities.
Companies that adopt CSR comprehensively not only strengthen their reputation, but also ensure your long-term success by aligning with the values and expectations of a society in constant change. Those organizations that ignore this reality risk being left behind, both in terms of reputation and financial performance.
Corporate responsibility is the path to a sustainable, fair and equitable future.
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About Yesenia Pellegrini (Author):
Consultant at TACs Consultores, specialist in the implementation of strategic solutions and digital improvements; seeks to optimize processes and ensure the success of our clients.
About Pablo Tellaeche (Editor):
Owner and main consultant of TACs Consultores, Lecturer and University Professor; seeks to bring a true and positive Culture Lean and Digital Transformation to any company with which you have the pleasure of collaborating.
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