Finding Economic Synergy: Types of CSR
There are many different ways in which a company can give back to its community. CSR activities aren’t just limited to donations, they also involve other practices such as awareness campaigns and internal-company policy measures. In many cases, CSR usually involves companies partnering with NGOs and other charitable organizations to create an effective system of collaboration where they can use essential insights from people in the field to guide their decision-making process. CSR is all about formulating connections with the larger public. This is why CSR activities are usually determined by trends in public activism. Based on the needs of the public, CSR can usually be divided into four categories:
Ethical Responsibility: Ethical responsibility means that businesses must ensure that their policies and work measures are fair, just and equitable. Ethicality is a broad term and therefore, it can be hard to define what practices are covered under this category, but it generally implies that businesses must be responsible for their actions. The basic standard for ethicality demands that businesses continue to be transparent about their activities with their employees, stakeholders and customers. Companies are required to provide their employees with a discrimination-free environment, healthcare benefits and paid leaves. They must also follow fair hiring and firing policies while ensuring that their labour and compensation policies comply with the requisite legal measures. Carrying out routine supply-chain assessments to check for illegal practices like child labour, indentured servitude and exploitative wages is also part of the company’s ethical responsibility.
Philanthropic Responsibility: Philanthropic responsibility includes CSR measures that the company is required to undertake voluntarily. This can include programs that help alleviate social and cultural disadvantages in low-income neighbourhoods through donations, campaigns and resource distribution drives. The major goal of this responsibility is to push companies to actively work towards improving living standards.
Environmental Responsibility: Most business practices of production and manufacturing can be extremely detrimental to the health of the environment. The goal of environmental responsibility is to make companies more responsible for carbon emissions, environmental pollution and biodiversity loss. In the age of climate-change-related environmental devastation, it’s even more essential that companies employ environmentally-friendly activities.
Economic Responsibility: Companies are also responsible for ensuring an equitable distribution of resources within the economy to promote poverty alleviation and upward social mobility. This responsibility combines all the others to create a balanced approach that propels companies to give back to society. To be economically responsible implies that companies should prioritize community development over individual profits.
