Corporate Social Responsibility (CSR) as a leadership framework recognizes and commits to integrating business models so that the organizational mission, vision, priorities, and strategies maximize positive impact on society and the environment.
The concept of Corporate Social Responsibility centers around the notion that companies should be held accountable for the social and environmental concerns of the public at large; even prioritizing these concerns ahead a company’s shareholders and investors. Therefore, according to Dr. Hayashi, while it is never easy for organizational members, “doing good” under the right leadership and organization design is absolutely possible, and worthy of all stakeholders to rise to the challenge.
While this may appear to neglect those willing to put money into the company—who may see diminished returns in the short-term—in favor of people who have no connection to an organization, CSR can ultimately enhance a company’s value, and shareholder profits, in the long-term. This is because it allows a company to connect with consumers at a level deeper than any product or service they may offer by exemplifying a shared set of morals, values, and world perspective.
“There are economists who look at social behavior, consumer behavior in particular, and believe consumers are not just making choices based on the monetary cost to them,” Dr. Hayashi says. “There’s also becoming this motivation for consumers to make purchasing decisions based on what I call the Dual Bottom Line. This is to say see that what is good for the environment or our common welfare is ultimately also good for themselves as individuals.”
One popular example of leveraging this type of consumer behavior can be seen with TOMS Shoes, a company dedicated to providing a child in need with a pair of shoes for every pair that is purchased from them by anyone, anywhere. Since 2006, it has donated more than 60 million pairs of shoes to children in more than 70 countries across the world, according to their website. Furthermore, the company has expanded beyond providing shoes and now also strives to enhance water quality, support safe birth services, and assist those with impaired vision or who have completely lost their eyesight.
While TOMS Shoes is doing beneficial work, the company is far from a mega-corporation, one capable of truly innovating the way our world lives on a day-to-day basis. But the model reflects a potential generational shift in how consumers will prioritize the companies they engage with moving forward. One of the most urgent issues consumers may identify with is climate change.
“There has been a longstanding environmental movement in the United States,” Joel Federman, Ph.D., chair of Saybrook’s Department of Transformative Social Change, says. “Currently, the emphasis of the movement is on addressing climate change in general, climate justice issues, and a specific focus on the development of oil pipelines, such as the Dakota Access Pipeline, that both do environmental damage and infringe on Native American rights. This modern-day movement is fueled by access to social media that has enabled tremendous support for these issues and for recognition of the science showing the significant impact of global warming and climate change.”
Dr. Federman adds that large-scale issues such as these will also require activism and policy development to push society in a more sustainable direction. At the end of the day, companies interested in making money would benefit from aligning themselves with increasingly socially conscious consumer demands. It will be important for organizations to be ready and willing to adjust their way of doing business or be left behind.
“The younger generation is more aware, accepting, and alarmed by global warming,” says Dr. Hayashi, adding that this generational shift in thinking includes both sides of the political spectrum. “This is important for companies to understand and to highlight, even reconsidering their marketing approaches and their product development approaches to address the way younger consumers are making their decisions. It is going to be a big issue that is going to affect companies across the board and they will have to have a response.”
