Why is social responsibility important to a business?
Social responsibility is important to a business because it demonstrates to both consumers and the media that the company takes an interest in wider social issues that have no direct impact on profit margins. These issues may be local, national or global, but a concern for the health and wellness of others that does not involve sales can be seen as commendable, if handled well.
For this reason, evidence of a healthy social responsibility policy can impact buying decisions where customers seek to make an ethical purchase. This, in turn, can lead to greater profits for a business. However, building a highly regarded and trustworthy reputation is more valuable in this instance, and observers appreciate that social responsibility initiatives take time to establish and manage.
Furthermore, being part of a scheme that helps disadvantaged people or those otherwise in need can help boost morale for employees within the responsible company. Along with other methods of morale boosting, this can lead to greater productivity among the workforce. Knowledge that a product and service has a great influence on social causes can be a genuine delight to employees, customers and business owners alike. Over time, the business contribution to a charity, cause or community can be a significant amount of charitable funds, product donations or other ventures.
When the importance of social responsibility is recognized as part of a business’s foundation, the impact of such endeavors can have life-changing consequences for recipients of aid and, equally, instill a sense of pride in the people who support and work toward its growth. A business can grow with or without social responsibility, but doing good for others allows a business to reap rewards in many ways.
This article was originally published at Investopedia.com.