Social responsibility - good business sense by Gary Newborough on 07-Mar-2011

T he previous government saw Social Responsibility as the business contribution to their sustainable development goals. Essentially about how business takes account of its economic, social and environmental impacts in the way it operates – maximising the benefits and minimising the downsides.

Specifically, they saw it as the voluntary actions that business can take, over and above compliance with minimum legal requirements, to address both its own competitive interests and the interests of wider society.

Government has a role in promoting continuous improvement in the business contribution to the three pillars - economic, social and environmental - of sustainable development.

The base level of responsible behaviour for any organisation is legal compliance and the Government has a role to play in setting standards in areas such as environmental protection, health & safety and employment rights.

The Government can also provide a policy and institutional framework that stimulates companies to raise their performance beyond minimum legal standards. Typically this has meant encouraging and incentivising the adoption of best practice guidance and, where appropriate, intelligent regulation and fiscal incentives.

Many small- and medium-sized businesses, however, have failed to see the economic arguments and any direct benefit, seeing it only as a fad, a quirk or even a stealth tax. As we come to terms with the depth and breadth of the current economic crisis even large firms knee-jerk reaction is to abandon business functions that are seen as a 'luxury'.

Forward-thinking schemes to up-skill staff or encourage diversity in the workplace are suddenly considered as nice add-ons. "It is not 'nice'," says Personnel Today the magazine for Human Resource Professionals, "to have a diverse workforce, it makes business sense to have an employee profile that reflects and therefore understands your customers. It is not 'nice' to have a skilled workforce - it will be the driving force of your business. It is not 'nice' to introduce health and wellbeing schemes, it will increase the productivity and effectiveness of your staff."

The opportunity to explore collaborative approaches to delivering local economic development and regeneration in a climate of constrained public spending is a real challenge of effective leadership.

The organisations that have taken the right approach to social responsibility are the most likely to remain committed, because they can see the cost-benefit. If anything, recent events demonstrate that being responsible is more important than ever and those businesses will be focused on long-term success (economic, social and environmental) rather than just short-term returns.

Ultimately, social responsibility can contribute to improving and sustaining financial performance. There is a real value for businesses in developing their people, trading responsibly, protecting the environment and working in partnership with their local communities. Being a great employer has so many business benefits from creating loyalty in the community in which you operate, to ensuring you recruit and retain the best talent.

Gary Newborough can be contacted via:
editorial@biz-works.net

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