No company is an island on its own. It is an inalienable part of the society in which it trades, and this influences its reputation in turn. A company likewise contributes to the economy, while relying on it to create circumstances within which it can flourish. This is the reasoning underpinning corporate social responsibility or CSR for short.
Like any good citizen, a company has a duty to contribute to the society within which it operates. Latest trends include strengthening community engagement, and becoming more involved in wider current affairs. We’ll get back to these thoughts later with some practical examples. But first, let’s create a broad backdrop to our theme.
Corporate Social Responsibility in a Modern World
CSR has attracted interest since the 1960’s, as an umbrella term for contributing to societal goals through philanthropy, direct action, and charitable giving. We can capture the essence of this in these four dimensions:
ECONOMIC RESPONSIBILITY – Your brand must generate income while being mindful of community needs. Your economic success should be in the best interests of society.
LEGAL DUTY – Your brand has a duty to comply with the laws of the society in which it operates. This includes both the letter and the intent of these laws.
ETHICAL OBLIGATIONS – Ethical responsibility takes your brand beyond laws and regulations, to doing what is just and fair while avoiding harm to others.
ALTRUISTIC OPPORTUNITY – Philanthropy is a desire to promote the welfare of others. It often finds expression through generous donations of money to good causes.
Corporate CSR Responsibility and Good Governance
An organisation’s social responsibilities must be relevant to that community’s immediate and longer-term needs. These are by nature collective challenges requiring social intervention, as opposed to leaving them in the hands of government.
Corporate social responsibility became compulsory in Malaysia in terms of reporting initiatives in 2019[i]. That was when the International Trade and Industry secretary-general’s program for corporate social responsibility reporting went live.
However, this initiative went further than encompassing community projects. It also extended to protecting the environment from disasters attributable to human behaviour. This new policy heralded a shift from reactive to thoughtful proactive behaviour.
Six Fresh Perspectives on Corporate Social Responsibility
Business being business cannot abandon its core objectives in favour of community priorities. It therefore needs to strike a balance between economic success, and the interests of society we referred to earlier.
We can’t for a moment suggest which individual CSR targets businesses should follow. However, here is a theoretical framework worth exploring as you determine your brand’s CSR goals for 2022:
- Put your own house in order in terms of environmental and social issues.
- Champion a social goal in the local community that relates to your own brand.
- Spend wisely by sourcing requirements from socially-responsible suppliers.
- Cease doing business with customers that disregard social priorities.
- Influence the hearts and minds of employees regarding relevant social issues.
- Give generously to charities operating beyond your own brand capability.
Corporate Social Responsibility Priorities to Consider in 2022
ECONOMIC RESPONSIBILITY – Embrace digital change as a future driver of your brand and broader society. Leverage the internet, smartphones, big data, artificial intelligence, the internet of things, and other technologies as World Bank suggests[ii]. Grow your business as you grow the economy within which you operate.
LEGAL DUTY – Pay ongoing attention to documenting, implementing, and monitoring your environmental, social, and governance goals. Pay particular attention to Malaysia’s vision of a future green economy. Let climate and environment be key criteria for all future strategic and business decisions.
ETHICAL OBLIGATIONS – Promote transparency in everything you do, for this is the best way to maintain the standards you strive for. Avoid a top-down approach. Engage your employees, involve them in decisions that affect them. Benefit from more inspired, more productive workers around you.
ALTRUISTIC OPPORTUNITIES – Step beyond the narrow confines of what’s good for your company and positive for society. Endow worthy charitable causes by giving until it starts to hurt. You will empower them to achieve far greater goals than you could. You will help Malaysia reach objectives you could never achieve on your own.
Three Malaysian Corporate Social Responsibility Trends to Watch
Accurate Measurement of CSR Impact
Once again, we have COVID to thank for a measure of this trend. Lower turnover necessitated more careful measurement of employee engagement, social outreach, and impact on company bottom line. Emphasis on metrics will continue.
Greater Emphasis on Current Events
Corporate social responsibility is thinking more nimbly in a decade proving more unpredictable that we imagined. COVID has taken its toll. The impact of the European war is uncertain. However, our duty to help the disadvantaged will be with us for ever.
Greater Use of Digital Connectivity
The COVID lockdown did away with the habit of meeting in person in buildings[iii]. It introduced direct communication with far larger audiences in the form of webinars, blogs, and social media posts. This trend is set to grow!