Reading: Corporate Social Responsibility

So far we have focused on ethical dilemmas in terms of risk. If a company acts unethically, it risks damaging its reputation and its customers’ trust—worse, it can face lawsuits and criminal prosecution. In this section we’ll discuss one of the ways in which companies attempt to get out in front of such risks by taking a proactive stance on ethics, instead.  As you saw with Tesla, companies that place “doing the right thing” at the center of their corporate mission and strategy often see a competitive advantage. Increasingly, they’re finding that good corporate citizenship not only benefits customers and communities but is good business, too.

Corporate social responsibility is the ethical behaviour of a company toward society. It means acting responsibly toward the stakeholders—not just the shareholders—who have a legitimate interest in the business.

Shareholders own a portion or “share” of a business. Stakeholders do not own the business, but they have some stake or interest in it because they are affected by the business’s strategies and tactics.  Examples of stakeholders are employees, suppliers, business partners, and the community in which the business operates.^[1]

Below are a few examples of businesses behaving ethically in ways that have a positive impact on their stakeholders.

IBM Canada investing in local CSR Programs

IBM has a large presence in Bedford, Nova Scotia (https://www.novascotiabusiness.com/case-stories/ibm-opposite-of-obvious) and is a local employer dedicated to supporting young professionals. IBM Service Corp is a program that offers employees opportunities to volunteer locally and internationally for up to four weeks. Offering a range of volunteer opportunities is in line with current employee expectations. “According to a 2019 study from charity.org, 86 per cent of surveyed employees expect their employers to provide opportunities to engage in the community, while 87 per cent of surveyed employees expect employers to support causes and issues that matter to them.” ^[2]

Anheuser-Busch Wants Customers to Drink Responsibly

In January 2014, Anheuser-Busch ran a Super Bowl ad featuring a cute puppy and the famous Budweiser Clydesdale horses. The ad plays on romance and nostalgia to remind viewers of the brand’s history (and to sell more beer).

In September 2014, the company brought back the puppy, this time to promote responsible drinking:

https://youtu.be/56b09ZyLaWk

You can view the transcript for “Someone Waits For You At Home, DON’T DRINK AND DRIVE | Budweiser Ads”. (opens in new window)
(https://oerfiles.s3-us-west-2.amazonaws.com/WM+Marketing/Transcriptions/SomeoneWaitsForYouAtHome.txt)

On its Web site, Anheiser-Busch lists a number of programs it has launched to reduce drunk driving. These are marketing programs that were developed to reduce the risk for consumers using the company’s products.

Anheuser-Busch is opposed to drunk driving and we believe it is 100 percent preventable. According to the U.S. Department of Transportation, drunk-driving fatalities have decreased 53 percent since 1982 to record lows, but we recognize there is still work to be done. As part of our effort to prevent drunk driving, we have key initiatives like the Budweiser Designate a Driver campaign and Bud Light safe ride home programs, including Bud Light Alert Cab and Bud Light Tow to Go.

The company is actively promoting safety for its customers and their communities.

Common Goods Solutions

Not only are companies in many forms expected by stakeholders and shareholders to focus on community impact, but there are many organizations that are being created to specifically address a need in a socially minded manner.
Social enterprises (https://www.investopedia.com/terms/s/social-enterprise.asp), Social finance (https://www.canada.ca/en/employment-social-development/programs/social-innovation-social-finance.html) and Non-governmental organizations (NGOs) are stepping in to collaborate and offer customers and communities innovative solutions through a different business model. Common Goods Solutions (http://commongoodsolutions.ca/), based in Nova Scotia is a social enterprise incubator and expert. Their co-founder, David Upton (http://commongoodsolutions.ca/our-story), apart from assisting many entrepreneurs in building and transforming their businesses, was also recently engaged to determine transportation solutions in a sustainable manner (https://static1.squarespace.com/static/57e9ccf9f7e0ab1a3447d112/t/5caf4445a4222f67071ebffe/1554990151730/Public+Report+Oct+2018.pdf) for Cape Breton, Nova Scotia. In part, the project created an innovation lab to determine solutions for access to transportation for the under- and unemployed.

Haagen-Dazs Cares about Its Tiniest Suppliers

Recently, the ice-cream company Haagen-Daz initiated a campaign to raise awareness about the threats to honey bees, which are rapidly disappearing and are vital to the global food chain (and many of the ingredients in flavoured ice cream). The company started a honeybee microsite (https://www.haagendazs.us/save-the-honey-bees) and is donating a portion of the proceeds from its honeybee brand to bee research. In November 2014, it raised an additional $7,000 for research during a two-day Twitter campaign (#HelpHoneyBees hashtag).^[3] 

Power of the People

Organizations have become more accountable through the evolution of CSR to ESG in part due to external influences (https://www.forbes.com/sites/georgkell/2018/07/11/the-remarkable-rise-of-esg/#14f558331695) including stakeholder activism. Greta Thunberg (https://www.businessinsider.com/greta-thunberg-bio-climate-change-activist-2019-9#she-has-offered-a-moral-clarion-call-to-those-who-are-willing-to-act-and-hurled-shame-on-those-who-are-not-time-magazine-wrote-of-thunberg-last-month-1) left school and went on “strike” to voice her concerns to institutions through a social media campaign #FridaysForFuture. Her actions occurred during the debate by businesses and government on how to create a carbon offset (https://www.theguardian.com/environment/2019/nov/08/greta-thunberg-effect-driving-growth-in-carbon-offsetting#:~:text=Growing concern about the climate,reducing projects in developing countries) to reduce fossil fuel emissions that are especially important in developing countries. ^[4][5]