Corporate Responsibility, Environmental, Social and Governance Factors
Corporate Responsibility is the latest movement in a long line of changes that are being made to the corporate world. Companies large and small are feeling the effects on their bottom line of what consumers are calling responsible leadership in the corporate world.
Gone are the days when people just bought goods and services willy nilly and didn’t think of the impact the company was making socially, environmentally and ethically. Now most people from Generation X to Millenials are conscious of what companies are doing responsibly before purchasing.
Corporate responsibility can be as simple as donating to a local food bank to cutting down a corporation’s carbon footprint by having meetings through digital means (welcome to the 21st century) rather than flying their private jets all over the world to meet with clients.
Take, for example, a company that has been in business for decades *ahem Avon ahem*. They claim to be cruelty-free meaning they do not test on animals. Which is absolutely true – in North America. However, they sell their products in China, a country with laws mandating companies to test on animals if they want to sell products there. Avon refuses to remove themselves from the Chinese market and because of that they cannot be certified a cruelty-free company. Which has caused an impact on their cosmetic sales, from 2011 to 2019 Avon’s global revenue dropped billions of dollars. Is that all because of not being certified cruelty-free? Certainly not, but it does have a significant impact.
Today consumers are flocking to companies that show they are socially responsible. Take ELF cosmetics for example. They quietly stated that they are cruelty-free and have been certified as such. Their sales have risen by billions since 2011 mostly in part because of their socially responsible business stance.
Cosmetics companies should also note that consumers can stand in any store with the Leaping Bunny Cruelty-Free app on their phone and decide immediately if they should be buying a brand of cosmetics or not based on certification. Something socially responsible corporations should take into consideration.
It’s not only large corporations that benefit from being responsible. Local businesses can do something as simple as a nearby restaurant that went door to door during a blackout handing out meals prepared in their kitchen using a generator. That restaurant saw sales spike ferociously because of such a simple act of kindness that only cost mere dollars to make and some personal time.
Responsibility is something all companies should build into their business models, as proven in the past ten years consumers will spend more money on the company that does more for the planet and community than a company that does nothing.