Whether you agree with the cause and effects of climate change or not, there is no doubt that organizations across the world play a large role in our environment and society. The idea of "Social Responsibility" has become more and more prevalent and impossible for consumers to ignore.
As it relates to a corporation, Social Responsibility implies that a corporation has a duty to act in the best interest of their environment or society. Examples include reducing their carbon footprints, improving labor policies by embracing fair trade, and changing certain corporate policies to benefit the environment.
The four types of Corporate Social Responsibility fall into these categories:
Ethical business practices
Direct philanthropic giving
In this post, learn how your organization's Procurement department can accelerate the impact of your corporate social responsibilities
Get creative with your tactics!
When most people think sustainability, they think directly sourcing sustainable goods or products. But what if this isn't possible? What if your organization simply doesn't make enough purchases to have a measurable impact on the environment?
Well, one of the methods companies are turning to is looking at indirect methods of reducing their environmental impacts. A few examples are only ordering products that can be delivered using electric vehicles. Or, contract with a facilities management company who uses energy-efficient and electric power tools and/or mowers. Perhaps your cleaning crew can switch to environmentally friendly cleaning products. The combination of these efforts truly makes a large impact.
Understand your sources The introduction of blockchain allows for procurement organizations to effectively manage and track the origin of the products and materials they purchase. This directly contributes to the impact of ethical business practices rating. For example, purchasing raw materials such as wood or steel from a country for very cheap may seem harmless on the surface. However, if the source harms the local population or environment, then that could reflect poorly on the business's social responsibility. If that wood purchase contributes to massive deforestation and habitat destruction, many people and communities could face harsh results.
For those that don't know, to define blockchain: "originally blockchain, a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. By design, a blockchain is resistant to modification of the data."
One of the growing behavioral epidemics amongst teens is car theft and vandalism. This has always been a problem, but the crime has started to grow at an alarming rate. By nature, this is a great opportunity for insurance companies to get involved. When a child steals a car or spray paints a building, more than often, insurance companies will see some losses when they must replace or repair the property. But how would they tackle this issue?
Once again, creativity and looking at the root cause could contribute to the solution. Insurance companies that invest in youth programs that help educate and improve youth opportunities understand the larger impacts that these problems have to their bottom line, and more importantly, society.
Organizations should take a holistic view on society and determine philanthropic methods of influencing change as it relates to their own mission.
Economic responsibility relates to growing the business in a sustainable and responsible manner. Typical examples of this are manufacturing companies that incorporate recycled materials.
Governmental policies are often introduced to make significant changes to business practices. For example, straws and single-use plastics have been banned in some cities. To combat this policy and remain responsible, some companies have adopted biodegradable straws or metal reusable straws. Both get the job done while contributing to the bottom line of growing profits and remaining competitive.
This is another opportunity for innovation and creativity. Not all companies have the opportunity or need to change materials that are crucial to their process. Some changes are direct sources of what is being sold. For example, harvesting caviar often involves slicing the fish open to remove the delicacy. Obviously, the fish does not live using these methods. Through innovation, some companies have developed a no-kill method to harvest caviar, leading to a sustainable and economically responsible process. Get creative The human race will forever be a society of innovators and problem-solvers. No matter the issue, we can find a solution. Not all problems can be solved through better procurement practices, but there is no doubt that the sourcing organization of your company can play a key strategic role in contributing to your social responsibility goals.