Innocent Drinks founder Richard Reed writes about how small businesses can get on board with corporate social responsibility (CSR) without putting their businesses at risk.
Owners of small to meduim sized businesses face many challenges on a day to day basis. But the main concern amongst owners is always one of funding, namely; "How can I maintain a balance between investing for growth without neglecting cashflow to ensure day to day survival?"
Unconventional from the start
Innocent Drinks is a good example. It's never been a conventional company. Because we started it as three close friends, it set a precedent in that we shared principles in our approach to life as well as business.
So, from the beginning there was always a sense that Innocent Drinks wasn't only about making a profit, but it was also important that it needed to be more than ‘just a business’.
We wanted to leave things a little bit better than we found them; to work in a more enlightened way, where we took responsibility for the impact of our business on society and the environment.
Put simply, it was in our strategy from conception that we wanted to become a truly sustainable business where we have a net positive effect on the world around us.
I believe that a business, no matter how big or small, has a role to play in making the world a better place alongside its commercial obligations.
Understandably, CSR is largely associated with big businesses, which tend to be more high profile and attract more media attention. They are also concerned with protecting and enhancing their own reputations with the broader public as well as key stakeholders, not mention being better-resourced and able to invest the required finance to make it happen. To this end, the adoption of CSR has come a long way, with community outreach and sustainability becoming standard practice for most well known business leaders.
Small business and corporate social responsibility
But what about smaller businesses? There's no hard or fast rule to suggest that only businesses of a certain size can run effective CSR programmes.
Across the board, the business world is increasingly under pressure to demonstrate responsible business practises. While many come under legal compliance like environmental legislation, more and more frequently, the businesses of today are increasingly being encouraged to go that extra mile.
To remain competitive in today’s fierce working environment, employers need to be able to adapt to new demands from both the market in which they operate in and society, no matter the size of the business.
This can be daunting to a small business owner with limited resources. But a CSR programme doesn't require multinational corporate-sized teams or budgets to make it work.
In fact, I believe that adopting CSR isn’t just the right thing to do, it can be the commercially savvy thing to do and it doesn't need to cost a fortune. Rather than aiming to win awards or investing huge swathes of cash into overseas projects, small businesses can make easy, affordable changes and create a CSR programme to benefit not only their communities and employees, but also their profits.
For most small businesses, implementing CSR is low down the priority list. But CSR can range from no-cost or very low-cost initiatives, such as giving staff days off work to volunteer for good causes, to high-budget strategy supported by PR or advertising.
There's no one size fits all model but as long as it’s considered and planned, business are only limited by ingenuity and creativity.
Impact on clients and talent
We wanted to become a truly sustainable business where we have a net positive effect on the world around us.
A business’ CSR efforts can make a huge difference to potential clients as well as to the talent it hopes to attract to its workforce.
Ultimately, small businesses need to engage employees and prevent them from being snapped up by larger corporates with bigger budgets for salaries. One way to do that is to be a business that reflects values that its employees can emotionally connect with. People want to work for businesses that can show that they care for the communities they are operating in or working with.
There are many other benefits to be had too including; strengthened corporate and brand reputations and enhanced trust with other key stakeholders (customers, regulatory agencies, suppliers, and investors), improved risk management, increased revenues from innovation to identify new business.
The bottom line is that CSR is a win-win situation and is not just for big businesses. It’s for everyone. I would congratulate any small business out there that has an effective CSR programme in place and urge those that don't to think again. Doing good doesn't need to cost the earth.
Richard Reed, will be speaking at the Business Funding Show in London on 2 and 3 February 2016.