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Why does Corporate Social Responsibility (CSR) matter for businesses?
What is CSR and why is it so important for businesses? With the ever growing social and environmental concerns of a business’ operations in contemporary society, there exists an inevitable pressure for businesses to consider what is known as the triple bottom line.
In brief, the triple bottom line posits the interrelated significance of the three dimensions – profit, people and planet- whereby rather than the sole focus on profit maximisation and return on investment, businesses should integrate social and environmental practices into their operational goals and values.
PwC and Atlassian Research
In a 2019 research conducted by PwC and commissioned by Atlassian Corporation Plc, studies revealed that Australian employees inherently desired businesses to have a strong leadership role on key societal issues such as the environment, healthcare and cost of living.
This Return on Action report surveyed more than 1,200 Australian employees regarding their expectations on the predominate issues relating to the sustainable accountability of a business and its moral obligations.
Key employee findings include:
- 69% agree on the interchangeability of a businesses’ societal impact and financial performance
- 78% agree that businesses are liable for their environmental impact
- 67% desire businesses to publicly encourage governments to act on relevant societal issues
- Only 34% or one in three employees are satisfied with the degree of sustainability of their employers in addressing CSR issues such as climate change, data privacy, unemployment and the cost of living
CSR from within
Mike Cannon-Brookes and Scott Farquhar, Co-Founders and Co-CEOs of Atlassian both emphasise how Australian businesses have reached the point where they must deal with social issues.
“As business leaders, we have an awesome responsibility. Employees want us to ensure we are making the planet better, not worse. Faced with government inaction on some of our biggest problems, it’s the business community that can step up and drive meaningful change,” said Mike Cannon-Brookes.
“Many companies focus only on the Return on Investment and delivering profit for shareholders. But times have changed. As business leaders we should listen to the views of the workforce; focusing on our impact on society delivers a return of its own. It’s now on us to respond,” said Scott Farquhar.
The environment and sustainability is amongst top employee concerns
Across all demographics, studies revealed that environmental issues relating to waste and pollution persist as a key area for change, whereby majority of employees want businesses to utilise their resources to facilitate purposeful and sustainable initiatives.
Sixty five percent of respondents fear the progressive impact of climate change in the next five years, while 70 percent agree that businesses have the ability to improve the impacts of climate change if they act now.
“The challenges we are facing as a nation and across the globe have never been more complex and we can’t rely on Governments alone for the solutions. Businesses must have a voice, contribute insights, take a position and innovate,” said Luke Sayers, CEO of PwC Australia.
“It’s what most employees expect of their employers and it’s also the only way we are going to find the right solutions and build a secure and sustainable path for future generations.”
The kids are not alright – Gen Z eager for CSR action
With the increasing prevalence of social media platforms covering issues related to sustainability, 72 percent of the youth, identified as Generation Z, are recognising the merit of businesses who integrate CSR initiatives into their business goals and operations.
Additionally, 75 percent agree that employees should be allowed to voice their opinions on political and societal issues they care about. Therefore, there is a considerable opportunity for businesses that endorse CSR.
Making the corporate world a better place
Patrick Coghlan, CEO of CreditorWatch, says that the company supports many social issues and gives examples of the types of activities more businesses could be involved with.
“We support a range of charities throughout the year at events like Abseil for Youth and the JP Morgan Challenge. A key aspect of our culture here at CreditorWatch is a focus on helping and supporting others that aren’t as fortunate as ourselves. Our team never shy away from supporting a good cause.
“Last year at the Vinnies CEO Sleepout, my pledge was to give all CreditorWatch staff one free day a year to volunteer for a charity of their choice. I’m also looking forward to the 2020 Vinnies CEO Sleepout in June, which will be the 15th year the event has been held in Sydney.
“This year, CreditorWatch chose the Starlight Children’s Foundation as our charity partner for 2020. The Foundation run a number of events throughout the year that CW staff have the opportunity to volunteer at, like the Colour Run.”