CSR: Size doesn’t matter

The business sector loves buzzwords. Nowadays, you will undoubtedly hear the terms social media or sustainable development everywhere you go.

Everyday, expressions such as these catch on and steadily gain popularity, compelling companies both large and small to act quickly with the hope of being the first to cash in on the trend.

After all, who knew that social media platforms, like Facebook and Twitter, could be a powerful marketing and advertising tool that could literally bring in millions in revenue? Or who could have ever predicted the global appeal of businesses that operated with a green thumb?

In recent years, trending the boards is the term corporate social responsibility (CSR). While not exactly new, it is arguably one of the more popular concepts that businesses have been paying attention to.

CSR: Evolution

Contrary to popular belief, CSR is a term that has been around for decades. Coined in the late 1960s, CSR essentially referred to corporations’ responsibilities to their stakeholders. At the time, even the term “stakeholder” was quite young—it only meant stockholders and customers.

In its early stages, CSR was primarily used as a tool to help in corporate image building.

Because of this, CSR programs predominantly consisted of doleout initiatives, which only few and large corporations could afford.

With the term’s history in mind, it is unsurprising that CSR was commonly perceived to be limited to larger enterprises.

But meanings change.

Over the years, CSR practice has grown and its scope has expanded to encompass employees’ continuous improvement and well-being, quality products and services, relationships with customers and suppliers, community development, contribution to economic growth, and environmental sustainability.

As CSR practices evolve and expand, they have become more integrated with overall corporate strategic plans and core business values.

CSR in Philippine MSMEs

Like in most countries, CSR in the Philippines is commonly associated with large corporations and implemented by adjunct foundations. Predictably, prestigious local and international CSR awards are usually awarded to large corporations as well.

CSR initiatives among MSMEs (micro, small and medium enterprises) in the Philippines are modest and informal even if they are innovative and size-appropriate. For instance, a food stall provides free water and coffee to street cleaners and traffic enforcers. A producer of herb-based food supplements provides college scholarships to children of employees. A fashion accessories company run by a colleague sub-contracts to local women’s groups in “depressed areas” while providing training, value formation, and other opportunities to uplift and empower the community.

The acts and amounts may seem small in comparison to the projects of large corporations but, evidently, the engagement is more direct, and the impact immediate.

Clearly, we see green shoots of CSR among Philippine MSMEs. However, the pace of growth is slow, but the potential is enormous.

So what would it take to harness the MSMEs’ potential for CSR growth?

CSR Tools for MSMEs

Correct CSR Misconceptions

CSR practitioners must realize that CSR is not just about doleouts and that it is not just a PR tool.

CSR is not just for large corporations. In fact, it is not just for corporations, period. Partnerships and single proprietorships or just about any entity doing business can engage in CSR.

CSR is not expensive, burdensome, time consuming or resource-draining. Small and simple initiatives, such as organizing car pools for employees or negotiating wholesale discounts for basic needs of its workers such as rice, school supplies, etc., can be launched quickly, can be replicated readily, and are easy to sustain.

Stakeholders are king. CSR projects should focus on stakeholders and not just corporate image. For instance, CSR initiatives that create a healthy working environment for employees will translate to better productivity, higher quality products, attract and retain good employees, increase market share and ultimately improve bottom line.

Reinforce CSR policies. Companies should institutionalize CSR by involving all employees in CSR activities. All members of a company should be responsible for upholding CSR as they go about performing their jobs. CSR champions should be identified to push CSR ventures.

Map CSR in the company’s DNA. Companies should adopt CSR among its core values. In making decisions and formulating strategies, CSR should be a vital consideration along with other key result areas such as product quality, customer satisfaction and cost efficiencies.

Support and patronize CSR proponents. As much as possible, choose suppliers and customers who promote CSR. Supporting CSR practitioners will help propagate CSR consciousness and responsible business that will ultimately be recognized by various stakeholders.

Measure and monitor CSR. Companies should keep track of CSR projects in order to instill CSR awareness among stakeholders. Parameters such as number of homeless people given shelter, quantity of out-of-school youths educated and employed and other measures give proponents a better sense of fulfillment and help fuel CSR spirit.

Encourage CSR. CSR objectives can be better achieved by recognizing and rewarding supporters of CSR undertakings. CSR citations will help impress upon employees that CSR endeavors complement other business objectives.

Acceptance

It is easy to see why CSR has gained acceptance as a concept. Its associations with excellence, holistic development, and responsibility have made it a worthwhile and lucrative principle to uphold in all aspects of doing business.

In 2010, the International Organization for Standardization launched ISO 26000 providing guidance on social responsibility. Sooner or later, we can expect a system of certification for CSR to be adopted and awarded to deserving enterprises.

Now, larger corporations will have to lead by example, showing MSMEs that CSR is not just about giving sums of money to those in need. In turn, smaller enterprises will soon find CSR doable, something that fosters productivity and goodwill even through seemingly small efforts.

CSR in any form, scope and size, can create a significant impact in the output of any company. Eventually, it should be an intrinsic part of every operation that a company undertakes.

Buzzwords die. But that’s a good thing. The hype surrounding them fades away because they become normalized and accepted facets of society. And once businesses understand the true meaning of CSR, it too will hopefully become ingrained in the minds of all enterprises in the community.

(The article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP. The author is member of the MAP CSR committee and the MAP Trade, Industry and Tourism committee. She is president of CLFG Capital Corp. and Active Alliance Finance Corp. She is also treasurer/director of CL Follosco Group Inc. Feedback at <[email protected]>and <[email protected]>.  For previous articles, please visit <map.org.ph>)