Part I: Why Should Small Biz Owners Give a F About CSR (Corporate Social Responsibility)?
A Series on Small Business Ethics
In a nutshell: Because your customers do…among obvious reasons.
People associate Corporate Social Responsibility or CSR with big corporations—but investing in CSR is becoming equally as important, if not more, to small business owners.
“Corporate social responsibility is a company’s commitment to manage the social, environmental, and economic effects of its operations responsibly and in line with public expectations.” – Definition pulled from this glossary.
According to Businesswire, 70% of consumers care about what brands are doing to make the world a better place. Of that group, 46% research a brand’s social responsibility efforts before making a purchase that would support them.
Another study by Cone Communications found that 63% of Americans expect businesses to step up to the plate on social and environmental issues in the absence of government regulation. 78% want companies to address social justice issues and 76% would stop purchasing a company’s products and/or services if the company failed to do the “morally-sound thing” (I will address these air quotes in a later segment).
Unsurprisingly, the millennial generation is leading the way towards a socially conscious consumer market. As our purchasing power continues to increase, so do the importance of our values to businesses at every size and scalability.
We care about how your business makes its products, pays its employees, and serves the greater good of humanity. We put in the time and effort to research your company because we prefer to spend our money with a good conscience. We respect brands for going above and beyond just making profits.
And with that, we have never been more skeptical of brands and businesses than we are today.
There are good reasons for our suspicion and mistrust. Back in college, my business ethics professor presented one too many case studies where corporations have failed people and society at horrific lengths. Check out this ridiculous list of ethical scandals from 2019 for some recent examples.
Now you may be wondering, it’s awful that big businesses are operating under unethical practices but I’m not a huge corporation. As a small business owner, why should I care?
Let’s dive a little deeper…
A great small business leader builds meaningful relationships with the people they serve every day. It’s reported that 72% of consumers believe locally owned businesses have a higher chance than large corporations of improving the quality of life in their communities.
All these statistics should be telling you two things:
Consumers are rooting for the underdog, and
You need to lean in now
As our society begins the shift to shop small or local, there will be certain expectations that need to be met.
making and selling ethically sourced products and taking a people-first approach to your services may cost you more in the beginning, but the end results outweigh the short-term setbacks by a looooooong shot.
When SMEs implement CSR, not only do they receive a favorable brand image while growing a loyal following—studies have also found an increased return-on-investment (ROI) in the process.
Meaning CSR is a win-win!
You’re doing good for your community while reaping the benefits.
The success stories of #ShopLocal and American Express Small Business Saturday campaigns are living testimonies of CSR initiatives and consumers’ changing preferences. Here’s the most recent example:
I swear this campaign hits me right in the feels every time I watch it. With all that’s going on in the current pandemic, small businesses taking the brunt of our economic downturn, this message rings truer than ever before.
In recent years, we’ve seen this movement transcend in popularity among people of all ages, cultures, and backgrounds. Having my own freelance business on the side and working closely with small business owners, I’ve witnessed first-hand the intrinsic value sustainability and ethical business practices have on people, society, and the environment.
The future of business is CSR.
Similar to the way e-commerce isn’t really a “trend” anymore, but the way we do modern business—having good business ethics and a solid CSR strategy will be the new norm in the next decade.
I’ll leave you with one last statistic.
Given that SMEs account for 99% of all businesses in the U.S., we are the makers of our economy. Being the overwhelming majority means we have a responsibility to be the social change we want to see in the world.
Imagine what we could accomplish if all small business owners joined forces to implement CSR initiates in their local communities. What would our world look like then?
Convinced on implementing CSR into the fabric of your small biz? Read Part 2 of my series on Small Business Ethics, coming soon! In Part 2, I will be discussing how small business owners can sew CSR into their overall business strategy.