CSR - Here's everything you need to know about: Corporate Social Responsibility

CSR

CSR plays a major role in both small and large companies today.

It does so because social responsibility, societal responsibility and sustainability are on the agenda for most consumers and employees when choosing a company.

In this article you can learn more about what CSR is and how you can best make CSR a part of your company.

What is CSR? 

CSR stands for Corporate Social Responsibility and includes everything that has to do with companies' influence on the environment and society. It is about showing responsibility in relation to society and conducting business in a way that has a positive impact on people, the environment and the economy.

It is important that your company's CSR focus is in line with the company's strategies and relationships in the market and challenges.

Below you can read more about what is needed to prepare a good CSR strategy.

CSR strategy 

It may be useful to follow these points when developing a strategy for CSR:

What fits well with your business profile?

In the initial phase, it is important to research what your company can contribute. Where do you make a difference? Are there places locally where your business is making a difference? What will fit in well with your company profile? These questions can be the starting point for you to delve into the right areas for your CSR efforts.

What would you like to achieve?

At this point, you must be clear about what you want to get out of your work with CSR. What are some societal challenges that you would like to be the solution to?

Look for business partners

Look for companies, associations or NGOs that will help to cooperate in achieving your CSR goals. Get in touch with the desired business partner and make a plan for what exactly your company will contribute to their organisation.

Create a plan for CSR goals

It is a good idea to make a plan for your goals in the company. Write down what your company's CSR goals are and keep the goals realistic. In addition, it is a good idea to consider when you would like to have reached your goal. You can make a schedule for this. You might getting inspired by the 17 UN´s world goals.

Set a framework for how you will evaluate your CSR strategy

When you have carried out activities within CSR, it is useful to evaluate and assess whether it has been worth the effort and what difference it has made to your company.

Now that we have the CSR strategy in place, we can move on to looking at what a CSR strategy can do for your company.

What is the benefit of preparing a CSR strategy?

Some companies were sceptical when CSR started to become part of most companies' daily lives. But today it has become a matter of course that companies must help take social and societal responsibility.

Not only does CSR have a positive impact on our society, it also benefits the company's bottom line. By incorporating CSR into your branding, you can both benefit from positive publicity and at the same time make your company more attractive to employees and customers.

Is CSR voluntary?

Since 2009, it has been a statutory requirement for larger companies to report their work with social responsibility.

Your company is covered by the legal requirements if the company is placed in accounting class C or D.

Conditions for being in accounting class C

To be placed in accounting class C, the company must exceed at least two of the following three size limits in the following year:

• Total assets of DKK 156 million
• A net turnover of DKK 313 million
• An average number of full time employees of 250

Conditions for being in accounting class D

If your company is placed in accounting class D, it is because your company has securities that are admitted to trading on a regulated market. That is, listed companies as well as state owned limited companies. 

Now that the rules are in place, we can take a closer look at the advantages and disadvantages of CSR.

Advantages and disadvantages of CSR

There are two general attitudes towards CSR. Either the companies believe that their only purpose is to generate profit and on the other hand, the attitude is that the companies must also take responsibility for the world we live in.

Let's take a closer look at the advantages and disadvantages of CSR.

Benefits of CSR

1. Shareholders are interested in social responsibility

The vast majority of people want a better world, where responsibility is taken for sustainable development in society. This also applies to shareholders, directors and company owners.

2. The big companies have succeeded with CSR

The large companies create good results by introducing CSR strategies. This can be seen both in their finances, but also employees and suppliers benefit from the good publicity that CSR can help create. The big companies can see that they get happy employees and a strong employer brand, which hits the spot at a time when ethics has become part of the agenda.

3. CSR strengthens your employer branding

In the end, CSR is not about earning the money you have invested in it. In contrast, CSR is about taking responsibility for the environment, people and society. CSR contributes to an atmosphere in the workplace that gives employees a feeling that they are making a difference. This is worth its weight in gold from an employer branding perspective.

4. Avoid scandals and media criticism

If your company introduces CSR and thus takes social, societal and financial responsibility, there is less chance of being in the media spotlight. This of course requires that you comply with what you promise in your CSR report, so that there is no discrepancy between what you say you do and what you actually do.

Disadvantages of CSR

1. It is not the responsibility of companies to save the world

Some companies believe that they do not have a social responsibility. They just have to abide by the law and not be irresponsible. To save the world, that is the responsibility of the politicians. This is how some of the arguments of the companies that do not yet think that CSR is something that they want to introduce in their company.

2. CSR is too expensive in relation to the benefits

Another disadvantage of CSR is that it can be expensive to lay out a good strategy and you don't necessarily get to see the money on the bottom line. This can be something that scares smaller companies with introducing CSR.

3. CSR can give bad publicity

It can be a disadvantage for your company to introduce CSR if it does not live up to the societal, social or financial responsibility it would like. The problem arises if your company prepares a CSR report but does not deliver what it promises. In this case, it can give bad publicity and have a bad impact on your business.

In this article, we have gone through the various CSR stages that you in your company must keep in mind when you have to decide whether CSR is right for your company.

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