As Consumers Demand That Businesses Address the "Social Side" of Sustainability, Those That Heed This Call Are Enjoying Greater Success
Historically corporations have directed their "people" efforts externally via their foundations, but integrating those programs has been able to streamline both customer desires and corporate profits.
May 31, 2021Updated 3 days ago
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Consumers increasingly expect companies to take an active interest in solving social problems. Socially conscious business models are expected by many customers, especially younger ones.
Increasingly, consumers expect their companies to engage with top social issues in their communities. For millennials and Gen-Z in particular, this is a non-negotiable.
And the data bears that out. The consultancy Porter Novelli found that 66 percent of Gen Zers "believe it is no longer acceptable for companies to be silent on social justice
issues." And a whopping 72 percent of Gen Zers "believe companies have more responsibility than ever before to address social justice issues."
Another study from Georgetown found the same to be true for millennials. This generation accounts for some $1 trillion in annual consumer spending, and for them, the social responsibility of companies is top of mind. Some 81 percent said they "expect companies to make a public commitment to good corporate citizenship.” And 73 percent were even willing to pay more for sustainable products.
As the authors of the study wrote: "By almost any measure, Millennials place a premium on corporate social responsibility (CSR) efforts."
And businesses are responding by integrating their social efforts into their business model. Those that have followed this path are seeing increased success.
For instance, Whole Foods has established the Whole Planet, Whole Kids, and Whole Cities Foundations to contribute to initiatives promoting healthy eating and broader food access in underserved communities—an effort that brought increased brand loyalty to the neighborhoods in which it operates. Original CEO John Mackey has been an icon in the social sustainability space and advocates for identifying a higher purpose for your business.
Other companies that may not have incorporated social commitments directly into their business model take steps to demonstrate it nonetheless through strong corporate social responsibility policies.
In 2020, U.S. businesses large and small stepped in to address social problems that are not being tackled by governments that are having a direct impact on their workforce, consumers, and the local community, especially during the COVID-19 pandemic. The corporations and businesses that stepped up to help, have received positive social media recognition, increased brand loyalty and a variety of other benefits to their reputation.
Nike, for instance, is an excellent example of how corporate responsibility can translate to major profits. The ad Nike published of Colin Kaepernick following his kneeling protest for Black Lives Matter may have sparked a boycott of some Nike consumers, but it also paid off big time for the brand. Nike saw their value increase by $6 billion and their stock go up 5 percent.
In short, as one survey found: "corporate social responsibility pays off."
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