Today people are more interested in supporting those businesses that go above and beyond to contribute towards a better society and safe environment. They are more likely to levitate towards companies with a social purpose or those that have adopted a CSR initiative.
Even the business world has recognised the importance of a social purpose or CSR in staying competitive. But many people confuse CSR and social purpose. In fact, some companies use CSR interchangeably with a social purpose. But the reality is that there is a vast difference between CSR and social purpose.
Let’s see what differentiates the two in detail.
What is CSR?
CSR means the responsibility of a business to ensure it does not cause any harm to society. Instead, it benefits not only society but also the environment. In simpler terms, it is a way for businesses to take responsibility for the social and environmental impacts created by their business operations to ensure that they are not contributing negatively to it.
According to Financial Times, Corporate Social Responsibility is “a business approach that contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders.”
CSR regulates itself, helping a company be more socially accountable to itself and its wide range of stakeholders. Additionally, it also helps a company know the kind of impact it is having on society.
Generally, it is large corporations that use CSR strategies. The main reason behind the same is that only companies go for CSR programs that have a strong foothold in the market. They have made enough profit that now they want to give back to society. But things are changing now. Even small businesses are adopting CSR campaigns and contributing by donating to charities and sponsoring local events.
CSR prioritises profits, people, and the environment in equal measure. It is a means to improve the reputation and profitability of businesses. Through their CSR initiatives, companies can communicate all that they do. This way, they can appeal to a broader range of consumers, stakeholders, and employees and form a strong bond with them.
Examples of CSR
Promoting volunteerism, helping in the local community, improving the environmental sustainability of business operations, reducing your organisation’s carbon footprint and donating to local charities can be some of the examples of CSR.
Some businesses have aligned their existing operations with their CSR initiative to better serve communities, people, and the planet. They are contributing to the development of the economy while improving society and the environment without causing any harm. One such example is Lego.
In Reputation Institute’s 2021 Global CSR RepTrack list, Lego bagged the number one position. It was not surprising because Lego has adopted several CSR initiatives like supporting children’s rights, using sustainable materials for manufacturing Lego elements and packaging materials and encouraging diversity and inclusion.
What is Social Purpose?
Social purpose means solving a problem that you are passionate about to make the world a better place. Social purpose guides everything a company does and determines its goals and strategy. It acts as a beacon that drives a company’s decisions, its leaders and employees.
A company having a social purpose will be defined as the one whose reason to exist is to solve societal problems and create a better world. It does so by making decisions for the long-term while simultaneously working on their day-to-day tasks for the short-term, balancing both the short and the long-term goals.
What a company having social purpose offers aligns with the solutions it wants to give to society in the long run so that the company’s central idea, products, and services provide value and benefits the community. It is an engine for good, creating social benefits by the way it conducts its business. The growth of that company will be a positive force in society.
A social purpose company will always need to make ethical decisions, whether they are financial, social or environmental. It will be the organisation’s responsibility to affect their employees, customers, society, the environment and all stakeholders in a positive manner.
Difference Between CSR and Social Purpose: Summary
Though both are different, having a social purpose and CSR can work wonders for an organisation and its reputation, giving it an edge over its competitors. If you have neither, it may be difficult to excel in today’s marketplace.
So, it is better to have a social purpose linked with corporate social responsibility. It will help you create and strengthen genuine relationships with your potential consumers while positively impacting society.
Have social purpose? Join Atb.world today to demonstrate your social purpose.