Over the last few weeks we have witnessed an increased number of meteorological catastrophes around the world. From heatwaves in Canada, to devastating floods in Europe and China, these events have made the consequences of climate change even more real to all of us. Companies will have a role to play in the fight against climate change over the coming years, just like they will have an impact on influencing how we grow as a society. How do we make sure future growth is inclusive and does not leave any community or parts of the planet behind? How can companies prepare and make a difference? In the journey towards sustainability, another concept has appeared: Corporate Citizenship.
Most of us will have heard of CSR, Corporate Social Responsibility, which has been adopted by large companies over the last few years. It can cover anything from volunteering work to philanthropy and, as well as doing good, has been used as a way to improve their brand’s image. CSR is the way to access Corporate Citizenship. A CSR programme is often designed by the management team to ensure the company is giving back to society and to boost its reputation.
Corporate Citizenship entails how companies meet legal, social, economic and ethical responsibilities whilst delivering a profit for their shareholders. It is about doing business successfully and ethically. These companies aim at improving standards of living and well-being in the community. It can be things like reducing pollution by managing their carbon footprint, recycling, helping employees volunteer, building schools in remote territories where they may have a factory, giving access to drinking water and really making an impact on the world around them by integrating these practices to their operations.
Corporate Citizenship is about being accountable for every business decision’s impact on society. In addition to fulfilling their commercial mission, these firms commit to ethical behaviours which will in turn raise standards and improve the environment.
But where is your company at on the journey to Corporate Citizenship? It is widely recognised that there are 5 stages through which businesses go to reach Corporate Citizenship. The Elementary stage is where a lot of small businesses are and usually remain. They comply with laws, environmental and health standards but do not have the resources or awareness to go further. At the Engagement stage, managers and employees start designing programmes and actions to contribute to the community. These programmes become a lot more sophisticated at the Innovative stage as senior stakeholders get involved and greater means are deployed to support and promote them. In the Integrated stage, firms have formally incorporated citizenship activities to their operations and are actively monitoring them and communicating on them. The last stage, also known as Transforming stage, marks the point where firms have fully integrated corporate citizenship to their strategy and operations and are using it to drive sales as well as making a positive impact on the community.
The journey can be long and requires willingness, support and resources, however the rewards are worth the effort. Corporate Citizenship will contribute to better brand recognition and positive business reputation. It can generate new customers, improve loyalty and attract talent whilst investing in inclusive growth and ensuring that in the long run, the business has a positive impact on its surroundings.
At Partner Financial we think investing in sustainable ways to improve our society and giving a better future to the coming generations is paramount. There is also a moral aspect to giving back to the communities who are contributing to a firm’s success and helping to enhance their lives. But this opens another debate, can companies be morally responsible for implementing a CSR programme and contributing to society in other ways than by delivering their commercial mission? Or does the amount of data available to corporations as well as their capacity to analyse and act upon it lead them to incur new moral responsibilities in a globalised world?
Being at the beginning of the sustainability journey, only time will tell.