CSR: What Is It And Why Is It Important?

Published September 5th, 2022 - 06:31 GMT
CSR: What Is It And Why Is It Important?
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The alarming threats that our planet is experiencing has driven many businesses to adopt corporate social responsibility (CSR). The reality of it is that businesses and consumers are beginning to realize that it is as much their responsibility as it is the governments to help drive more sustainable solutions. 

This growing need to turn to sustainable solutions to help preserve the planet has led many many consumers to look for more sustainable goods. In fact, a 2021 report by the The Economist Intelligence Unit, reports a 71% increase in global searches for sustainable products. This comes to show that the world is beginning to understand that we all have a social responsibility towards our world, especially business. 

What is CSR? 

In simple words, CSR refers to a company's commitment towards its customers, society, and the world. For businesses to better understand how they can help, CSR is broken down into 4 different responsibilities which are, environmental, ethical, philanthropic, and economic. 

  • Environmental Responsibility: 

This type of CSR revolves around being committed to using environmentally friendly processes such as reducing pollution and emission, opting to use renewable energy, and carrying out projects that help the environment in general. 

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  • Ethical Responsibility: 

Companies also have an obligation towards carrying out their business in an ethical and honest manner. This is done by ensuring that all stakeholders are treated fairly, and that they are not using any products or resources coming from slavery or child labor. 

For instance, leading UAE company, Al Ghurair, has launched a number of projects that align with its CSR. Al Ghurair is proudly supporting the UAE initiative, Absher, to help empower UAE nationals and encourage them to join the labor market. 

  • Philanthropic Responsibility: 

In addition to being ethically and environmentally friendly, many companies also give away part of their earnings as a way to give back to their community. This is where philanthropy comes in, it is finding ways to give back to the community by donating, starting charities, and supporting worthy causes. 

The Chalhoub group is also driven by creating an impact in several different areas including, providing volunteering opportunities in the areas they operate as a way to build strong and meaningful bonds with the communities. 

  • Economic Responsibility: 

While businesses operate and are driven to maximize their income, economic responsibility comes in to highlight that this can be done while also ensuring they are positively impacting the environment and society. 

Benefits and Importance of CSR

Corporate social responsibility is a key aspect of ensuring businesses are giving back to communities and helping pave the way for more sustainability. However, the importance and relevance of social responsibility extends beyond just making an impact, because it also has significant benefits for businesses. 

On a business level, having a deeply-rooted sense of social responsibility makes the company more appealing to employees. CSR helps attract reliable and productive employees who are driven by the desire to help their community. Not only that, but millennials, which make up a significant amount of the workforce, are more likely to stay in a company that has a purpose, says reports. 

In addition to attracting good talent, businesses that implement CSR are more likely to attract investors. In fact, a 2016 CSR report suggests that investors are more likely to invest and stick with companies that are socially responsible, as this shows they are less likely to have unethical behavior. From another front, having a CSR can also benefit the branding and perception of businesses, which in return can make it more appealing. 

While social responsibility is not compulsory, it is a necessity. It is the responsibility of every individual and business to ensure that we are actively taking part in preserving the planet. 

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