With so many different examples of corporate social good today, it can be confusing to understand what it all means. The most common terms that are used include: “corporate social responsibility,” “corporate philanthropy,” “cause marketing,” “social enterprise” and “B-Corp.” Today we’re going to break down these terms and explore where exactly your company fits in.
Corporate Social Responsibility (CSR)
Corporate giving is evident as far back as the late 1800’s with one of the first examples being Macy’s department store contributing funds to an orphanage asylum in 1875 (Crane, 2008). However it wasn’t until the 1950’s that businesses began to acknowledge their responsibility for the well-being of local and global communities. This defines the fundamental purpose of corporate social responsibility (CSR); companies should operate to enhance communities and be held accountable for any of their actions that impact the social and environmental health of people and the planet.
Today, CSR is an umbrella term which describes any and all activities undertaken by businesses that aim to improve social, cultural and environmental well-being. Examples of this include labor rights and inclusive hiring practices. Another example is minimizing a company’s carbon footprint by using alternative energy sources, where possible. CSR also includes corporate philanthropy which we’ll take a look at next.
Corporate philanthropy is one form of CSR and is when a company gets directly involved with a charity or cause. Corporate philanthropy has shifted greatly over the last 50+ years, from being primarily financial donations to a wide range of ways companies and charities connect.
Companies can take their corporate giving beyond financial donations by providing resources to charities such as in-kind donations, pro-bono services and volunteers. With a rise in employees who value philanthropic companies, corporate philanthropy has become a way to attract and retain talent as well as provide opportunity for skill enhancement and team building. Additionally, many companies offer employee volunteer programs to empower their individual employees to give back.
Cause marketing is a specific type of corporate philanthropy that emerged in the late 1970’s according to Marketing-Schools.org. Cause marketing works when a company partners with a charity or cause and then contributes a portion of their revenue to that cause. For the company, it’s a method to give back and also a way to increase positive public perception and brand awareness. Really, it’s a win-win situation for both the company and their charity partner.
A great example of cause marketing is American Express’ 1983 campaign to restore the Statue of Liberty. Every time a customer made a transaction on their American Express card or opened a new account, American Express gave the Statue of Liberty-Ellis Island Foundation a portion of the fee. Additionally, think about the last time you went grocery shopping and were asked if you wanted to donate $5 to support a certain organization? That was cause marketing.
The 2018 Human Global Capital report from Deloitte predicts a fundamental change that will encourage businesses to shift from being a business enterprise with a focus on financial performance to a social enterprise with a focus on their community impact. So, what’s social enterprise?
It’s estimated by the Toronto Enterprise Fund that there’s over 25,000 social enterprises in Canada today.
A social enterprise is either a business or a non-profit with a dual purpose – to generate an operating surplus through selling goods and services to the public, and to reinvest this money in a social or environmental cause. In other words, they exist to give back. It’s estimated by the Toronto Enterprise Fund that there’s over 25,000 social enterprises in Canada today.
An example of a non-profit social enterprise is the Canada-wide YMCA – they generate income through a monthly membership fee and the majority of those funds go to supporting their community programming. An example of a business that functions as a social enterprise is Fogo Island Inn in Newfoundland. The inn exists primarily to support economic resiliency of Fogo Island, with all operating surpluses reinvested in community programming.
Currently in Canada there are over 230 B-Corps.
The B-Corp certification is a global verified standard for CSR practices. Companies that are Certified B-Corps meet the highest standards of social and environmental performance, public transparency and legal accountability. They’ve undergone an in-depth assessment of their impact on the well-being of their workers, customers, community and environment. If they pass the test, then they are awarded the B-Corp Certification. Currently in Canada there are over 230 B-Corps. A couple local examples include Salt Spring Coffee, tentree and SPUD.ca (B Lab, 2019).
Unsure Where your Company Fits In?
That’s what we’re here for! At HeartPress we work with companies that are ready to give back. We help companies determine their community investment strategy and find out how they want to be giving. Get started with #BrokersOfGood to discover your companies philanthropic values and search for give-back opportunities in your neighborhood.