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Case Study: Corporate Social Responsibility of Starbucks

Starbucks is the world’s largest and most popular coffee company. Since the beginning, this premier cafe aimed to deliver the world’s finest fresh-roasted coffee. Today the company dominates the industry and has created a brand that is tantamount with loyalty, integrity and proven longevity. Starbucks is not just a name, but a culture .

It is obvious that Starbucks and their CEO Howard Shultz are aware of the importance of corporate social responsibility . Every company has problems they can work on and improve in and so does Starbucks. As of recent, Starbucks has done a great job showing their employees how important they are to the company. Along with committing to every employee, they have gone to great lengths to improve the environment for everyone. Ethical and unethical behavior is always a hot topic for the media, and Starbucks has to be careful with the decisions they make and how they affect their public persona.

The corporate social responsibility of the Starbucks Corporation address the following issues: Starbucks commitment to the environment, Starbucks commitment to the employees, Starbucks commitment to consumers, discussions of ethical and unethical business behavior, and Starbucks commitment and response to shareholders.

Commitment to the Environment

The first way Starbucks has shown corporate social responsibility is through their commitment to the environment. In order to improve the environment, with a little push from the NGO, Starbucks first main goal was to provide more Fair Trade Coffee. What this means is that Starbucks will aim to only buy 100 percent responsibly grown and traded coffee. Not only does responsibly grown coffee help the environment, it benefits the farmers as well. Responsibly grown coffee means preserving energy and water at the farms. In turn, this costs more for the company overall, but the environmental improvements are worth it. Starbucks and the environment benefits from this decision because it helps continue to portray a clean image.

Another way to improve the environment directly through their stores is by “going green”. Their first attempt to produce a green store was in Manhattan. Starbucks made that decision to renovate a 15 year old store. This renovation included replacing old equipment with more energy efficient ones. To educate the community, they placed plaques throughout the store explaining their new green elements and how they work. This new Manhattan store now conserves energy, water, materials, and uses recycled/recyclable products. Twelve stores total plan to be renovated and Starbucks has promised to make each new store LEED, meaning a Leader in Energy and Environmental Design. LEED improves performance regarding energy savings, water efficiency, and emission reduction. Many people don’t look into environmentally friendly appliances because the upfront cost is always more. According to Starbucks, going green over time outweighs the upfront cost by a long shot. Hopefully, these new design elements will help the environment and get Starbucks ahead of their market.

Commitment to Consumers

The second way Starbucks has shown corporate social responsibility is through their commitment to consumers. The best way to get the customers what they want is to understand their demographic groups. By doing research on Starbucks consumer demographics, they realized that people with disabilities are very important. The company is trying to turn stores into a more adequate environment for customers with disabilities. A few changes include: lowering counter height to improve easy of ordering for people in wheelchairs, adding at least one handicap accessible entrance, adding disability etiquette to employee handbooks, training employees to educate them on disabilities, and by joining the National Business Disability Council. By joining the National Business Disability Council, Starbucks gains access to resumes of people with disabilities.

Another way Starbucks has shown commitment to the consumers is by cutting costs and retaining loyal customers. For frequent, loyal customers, Starbucks decided to provide a loyalty card. Once a customer has obtained this card, they are given incentives and promotions for continuing to frequent their stores. Promotions include discounted drinks and free flavor shots to repeat visitors. Also, with the economy being at an all time low, Starbucks realized that cheaper prices were a necessity. By simplifying their business practices, they were able to provide lower prices for their customers. For example, they use only one recipe for banana bread, rather than eleven!

It doesn’t end there either! Starbucks recognized that health is part of social responsibility. To promote healthier living, they introduced “skinny” versions of most drinks, while keeping the delicious flavor. For example, the skinny vanilla latte has 90 calories compared to the original with 190 calories. Since Starbucks doesn’t just sell beverages now, they introduced low calorie snacks. Along with the snacks and beverages, nutrition facts were available for each item.

Also one big way to cut costs was outsourcing payroll and Human Resources administration . By creating a global platform for their administration system, Starbucks is able to provide more employees with benefits. Plus, they are able to spend more money on pleasing customers, rather than on a benefits system.

Commitment and Response to Shareholders

One way Starbucks has demonstrated their commitment and response to shareholder needs is by giving them large portions. By large portions, Starbucks is implying that they plan pay dividends equal to 35% or higher of net income to. For the shareholders, paying high dividends means certainty about the company’s financial well-being. Along with that, they plan to purchase 15 million more shares of stock, and hopefully this will attract investors who focus on stocks with good results.

Starbucks made their commitment to shareholders obvious by speaking directly to the media about it. In 2004, Starbucks won a great tax break, but unfortunately the media saw them as “money grubbing”. Their CEO, Howard Shultz, made the decision to get into politics and speak to Washington about expanding health care and the importance of this to the company. Not only does he want his shareholders to see his commitment, but he wants all of America to be able to reap this benefits.

In order to compete with McDonalds and keeping payout to their shareholders high, Starbucks needed a serious turnaround . They did decide to halt growth in North America but not in Japan. Shultz found that drinking coffee is becoming extremely popular for the Japanese. To show shareholders there is a silver lining, he announced they plan to open “thousands of stores” in Japan and Vietnamese markets.

Commitment to Employees

The first and biggest way Starbucks shows their commitment to employees is by just taking care of their workers. For example, they know how important health care, stock options, and compensation are to people in this economy. The Starbucks policy states that as long as you work 20 hours a week you get benefits and stock options. These benefits include health insurance and contributions to employee’s 401k plan. Starbucks doesn’t exclude part time workers, because they feel they are just as valuable as full time workers. Since Starbucks doesn’t have typical business hours like an office job, the part time workers help working the odd shifts.

Another way Starbucks shows their commitment to employees is by treating them like individuals, not just number 500 out of 26,000 employees. Howard Shultz, CEO, always tries to keep humanity and compassion in mind. When he first started at Starbucks, he remembered how much he liked it that people cared about him, so he decided to continue this consideration for employees. Shultz feels that a first impression is very important. On an employee’s first day, he lets each new employee know how happy he is to have them as part of their business, whether it is in person or through a video. His theory is that making a good first impression on a new hire is similar to teaching a child good values. Through their growth, he feels each employee will keep in mind that the company does care about them. Shultz wants people to know what he and the company stand for, and what they are trying to accomplish.

Ethical/Unethical Business Behavior

The last way Starbucks demonstrates corporate social responsibility is through ethical behavior and the occasional unethical behavior. The first ethically positive thing Starbucks involves them self in is the NGO and Fair Trade coffee. Even though purchasing mostly Fair Trade coffee seriously affected their profits, Starbucks knew it was the right thing to do. They also knew that if they did it the right way, everyone would benefit, from farmers, to the environment, to their public image.

In the fall of 2010, Starbucks chose to team up with Jumpstart, a program that gives children a head start on their education. By donating to literacy organizations and volunteering with Jumpstart, Starbucks has made an impact on the children in America, in a very positive way.

Of course there are negatives that come along with the positives. Starbucks isn’t the “perfect” company like it may seem. In 2008, Starbucks made the decision to close 616 stores because they were not performing very well. In order for Starbucks to close this many stores in one year, they had to battle many landlords due to the chain breaking lease agreements. Starbucks tried pushing for rent cuts but some stores did have to break their agreements. On top of breaching lease agreements, Starbucks was not able to grow as much as planned, resulting their future landlords were hurting as well. To fix these problems, tenants typically will offer a buyout or find a replacement tenant, but landlords are in no way forced to go with any of these options. These efforts became extremely time consuming and costly, causing Starbucks to give up on many lease agreements.

As for Starbucks ethical behavior is a different story when forced into the media light. In 2008, a big media uproar arose due to them wanting to re-release their old logo for their 35th anniversary. The old coffee cup logo was basically a topless mermaid, which in Starbucks’ opinion is just a mythological creature, not a sex symbol. Media critics fought that someone needed to protect the creature’s modesty. Starbucks found this outrageous. In order to end the drama and please the critics, they chose to make the image more modest by lengthening her hair to cover her body and soften her facial expression. Rather than ignoring the media concerns, Starbucks met in the middle to celebrate their 35th anniversary.

Related posts:

• Case Study: Corporate Social Responsibility at The Body Shop
• Case Study: British Petroleum and Corporate Social Responsibility
• Case Study: Starbucks Social Media Marketing Strategy
• Corporate Social Responsibility (CSR) – Definition, Perspectives and Approaches
• The Importance of Corporate Social Responsibility in Business
• Carroll’s Pyramid of Corporate Social Responsibility
• Corporate Social Responsibility as a Source of Competitive Advantage
• Stakeholders Perspective on Corporate Social Responsibility (CSR)
• Stakeholder Expectations and Corporate Social Responsibility (CSR)
• Aligning Business Ethics and Corporate Social Responsibility

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A case study on Corporate Social Responsibility in NESTLE, TATA, ITC

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What is Corporate Social Responsibility: A Breakdown of Examples and Tips to Guide Your CSR Strategy

What is corporate social responsibility (csr).

Corporate social responsibility (CSR) can be defined as a self-regulated business approach where companies integrate social, environmental, and economic commitments into their operations and stakeholder interactions . Companies often measure and report this commitment through the "Triple-Bottom-Line Approach," monitoring social and environmental efforts, sustainability, and profits. CSR goes beyond charity and philanthropy, aiming to positively impact society while addressing the expectations of shareholders and stakeholders. Organizations can achieve this by building strategies and programs to address concerns like ethical sourcing of material, labor standards, and eco-friendliness of products and processes. Apart from its societal benefits, adopting such practices reflects the moral compass of the leadership and positions the business as a responsible and trustworthy entity in the eyes of stakeholders.

Over time, the concept of CSR has moved from an internal organizational policy or a corporate ethic strategy to mandatory schemes at regional, national, and international levels. In 2019, about 90% of firms listed on the S&P 500 index released a CSR report, a significant increase from only 20% in 2011 .

What is the importance of corporate social responsibility?

Corporate social responsibility benefits go beyond environmental and social aspects, positioning companies for sustained growth and long-term success. 

A genuine commitment to CSR can enhance a company's reputation and is a powerful marketing tool to foster consumer loyalty and differentiate it from competitors in an increasingly conscious market. It also helps place the company favorably in the eyes of consumers, regulators, and investors. For instance, a Neilson survey conducted in 2015 highlighted that 50% of consumers were willing to pay more for a sustainably produced product . 

Apart from external benefits, CSR helps the company internally. A Forbes publication reports that a purpose-driven and socially responsible company attracts more talent . A company’s CSR efforts also improve employee engagement and satisfaction , creating a productive work environment with high talent retention.

With customers willing to pay a higher price and reduced employee turnover, companies implementing CSR initiatives are bound to save money in the long run .

Corporate Social Responsibility examples

Here are some case studies from leading corporate social responsibility companies:  

Case study 1: Corporate social responsibility at Apple

Apple Inc., a global technology giant, has a vast supply chain and manufacturing processes for its products and devices, which has led it to face challenges related to environmental sustainability, ethical labor practices, and electronic waste management. Over the years, it has introduced a series of CSR initiatives to combat these challenges and create a positive impact on the world, some of which are:

Recycling and material recovery : Apple launched its robot, "Daisy," capable of disassembling iPhones to recover valuable materials. This initiative aims to reduce electronic waste and has recycled devices. One “Daisy” can disassemble 1.2 million iPhones per year.

Renewable energy : Apple committed to using 100% renewable energy across all its operations, from retail stores to corporate offices and data centers.

Supplier Responsibility : Apple implemented a stringent supplier code of conduct, ensuring its suppliers globally adhere to ethical labor practices, provide safe working conditions, and reduce their environmental impact.

Case Study 2: Corporate social responsibility at Starbucks

Starbucks, the global coffeehouse chain, is known for its unique coffee blends and customer experience. However, with its expansive operations, Starbucks faced challenges related to sustainable sourcing, waste management, and community engagement. Here are some CSR initiatives the company has implemented:

Ethical sourcing : Starbucks launched its "C.A.F.E. Practices," ensuring that the coffee they source is sustainable, benefiting farmers and the environment. Over 99% of their coffee is ethically procured through this initiative. 

Reusable cups : Starbucks encouraged customers to bring their reusable cups by offering discounts to reduce waste. They also introduced recyclable cup solutions in select markets.

Community engagement : Starbucks initiated the "Starbucks Foundation" to support community development, focusing on youth education, leadership, and disaster relief.

Types of Corporate Social Responsibility

Environmental responsibility : This pertains to the duty of companies to conduct their business in a way that is not harmful to the natural environment by reducing carbon footprints, recycling, proper waste management, and using sustainable resources, among other steps.

Example : Unilever, a multinational consumer goods company, launched its Sustainable Living Plan to halve its products' environmental footprint by 2030. They've sourced raw materials sustainably, reduced waste, and decreased greenhouse gas emissions. Apart from the program, they've committed to making all their plastic packaging recyclable, reusable, or compostable by 2025.

Ethical responsibility : Ensuring companies operate morally and ethically towards all stakeholders is a core part of this type of CSR. It goes beyond legal requirements and involves doing what is right, even when the law may not require it.

Example : Patagonia, an outdoor clothing company, is known for its ethical business practices. They've been a leader in using organic cotton, with 82% of their clothing line Fair Trade Certified™. This certification means that for every product made, they pay a premium that workers can use to elevate their standard of living or use for social and economic projects.

Philanthropic responsibility : This refers to the charitable activities undertaken by companies to improve the quality of life in local communities and society. It's about giving back to the community, often through donations, volunteering, or support for nonprofit organizations.

Example : Microsoft, through its philanthropic arm, has donated billions in cash, services, and technology to nonprofits worldwide. According to their reports on corporate social responsibility, one of their initiatives, TEALS (Technology Education and Literacy in Schools), pairs tech professionals with teachers to co-teach computer science in U.S. high schools.

Economic responsibility : In the context of CSR, economic responsibility means that the company should bring economic benefits to the communities in which it operates, such as creating jobs, fostering local entrepreneurship, investing in infrastructure, and supporting local suppliers.

Example : Coca-Cola, the global beverage leader, has initiatives to empower women entrepreneurs through its "5by20" program. This initiative aimed to enable the economic empowerment of 5 million women entrepreneurs across the company's value chain by 2020. By providing women with access to business skills training, financial services, and mentorship, Coca-Cola ensured that these entrepreneurs grow, which benefits the local communities they serve and strengthens the company's supply chain.

How to develop a successful corporate social responsibility strategy?

Executive buy-in : Before diving into a sustainability and corporate social responsibility initiative, it is imperative to have the backing of top leadership. This alignment ensures consistency with the company's primary objectives and signals the strategy's significance to all involved parties. A CSR strategy must also align with metrics with a bottom-line impact to ensure success and can be used to indicate long-term benefits to stakeholders. 

Identify material issues : Pinpoint the domains where your organization can create the most profound difference, considering stakeholder concerns and your business activities. To identify these pivotal issues, undertake a materiality evaluation internally or via an external agency. Structured methodologies like the United Nation's Sustainable Development Goals can offer a systematic approach. Considering questions like: What are the goals of our ongoing projects? Who is experiencing the advantages they bring about, and how do these initiatives assist us in tackling our critical strategic issues and prospects?

Foster meaningful partnerships and collaborations : Collaborative efforts that target partners that could benefit from your business and you from theirs can be a great opportunity to amplify the impact of CSR initiatives. Partnering with NGOs, industry peers, or local communities can leverage collective expertise and resources to build creative solutions. In such ventures, the focus moves away from merely avoiding risk and managing reputation to creating real societal benefits at scale. 

Team member engagement and training : Implementing a CSR initiative requires organizational commitment and top management to lead by example. Employees are the backbone of any CSR initiative. Engage them by creating awareness programs, workshops, and training sessions highlighting the importance of CSR. Encourage them to participate in volunteer programs or contribute ideas for new CSR projects. By making them feel involved and invested, you boost morale and ensure the successful implementation of initiatives.

Stakeholder feedback mechanism : Establish a system to gather feedback from stakeholders, including customers, suppliers, investors, and local communities, through surveys, focus groups, or community forums. Regularly collecting and analyzing feedback ensures that your CSR initiatives are aligned with stakeholder expectations and provides insights into areas of improvement.

Corporate social responsibility (CSR) has transitioned from a buzzword to an essential facet of modern business. Along with its environmental, social, and economic benefits for society, CSR can improve a company’s reputation, attract talent, engage employees, and cut costs in the long run. Inspiring examples from industry leaders like Apple and Starbucks showcase the potential of CSR in driving positive societal change while enhancing brand value. CSR is a guiding principle as businesses evolve, promoting sustainable growth and fostering stakeholder trust.

Are you a corporation looking to drive social, environmental, and economic impact in society?  

Futurize can foster collaborations between academic institutions, governments, corporations, and startups to help CSR teams build innovation and entrepreneurship programs to tackle the UN’s SDGs . Get in touch with us at [email protected] ! 

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The Business Case for Corporate Social Responsibility

Matteo Tonello is Director of Corporate Governance for The Conference Board, Inc. This post is based on a Conference Board Director Note by Archie B. Carroll and Kareem M. Shabana , and relates to a paper by these authors, titled “The Business Case for Corporate Social Responsibility: A Review of Concepts, Research and Practice,” published in the International Journal of Management Reviews .

In the last decade, in particular, empirical research has brought evidence of the measurable payoff of corporate social responsibility (CSR) initiatives to companies as well as their stakeholders. Companies have a variety of reasons for being attentive to CSR. This report documents some of the potential bottomline benefits: reducing cost and risk, gaining competitive advantage, developing and maintaining legitimacy and reputational capital, and achieving win-win outcomes through synergistic value creation.

The term “corporate social responsibility” is still widely used even though related concepts, such as sustainability, corporate citizenship, business ethics, stakeholder management, corporate responsibility, and corporate social performance, are vying to replace it. In different ways, these expressions refer to the ensemble of policies, practices, investments, and concrete results deployed and achieved by a business corporation in the pursuit of its stakeholders’ interests.

This report discusses the business case for CSR—that is, what justifies the allocation of resources by the business community to advance a certain socially responsible cause. The business case is concerned with the following question: what tangible benefits do business organizations reap from engaging in CSR initiatives? This report reviews the most notable research on the topic and provides practical examples of CSR initiatives that are also good for the business and its bottom line.

The Search for a Business Case: A Shift in Perspective

Business management scholars have been searching for a business case for CSR since the origins of the concept in the 1960s. [1]

An impetus for the research questions for this report was philosophical. It had to do with the long-standing divide between those who, like the late economist Milton Friedman, believed that the corporation should pursue only its shareholders’ economic interests and those who conceive the business organization as a nexus of relations involving a variety of stakeholders (employees, suppliers, customers, and the community where the company operates) without which durable shareholder value creation is impossible. If it could be demonstrated that businesses actually benefited financially from a CSR program designed to cultivate such a range of stakeholder relations, the thinking of the latter school went, then Friedman’s arguments would somewhat be neutralized.

Another impetus to research on the business case of CSR was more pragmatic. Even though CSR came about because of concerns about businesses’ detrimental impacts on society, the theme of making money by improving society has also always been in the minds of early thinkers and practitioners: with the passage of time and the increase in resources being dedicated to CSR pursuits, it was only natural that questions would begin to be raised about whether CSR was making economic sense.

Obviously, corporate boards, CEOs, CFOs, and upper echelon business executives care. They are the guardians of companies’ financial well-being and, ultimately, must bear responsibility for the impact of CSR on the bottom line. At multiple levels, executives need to justify that CSR is consistent with the firm’s strategies and that it is financially sustainable. [a]

However, other groups care as well. Shareholders are acutely concerned with financial performance and sensitive to possible threats to management’s priorities. Social activists care because it is in their long-term best interests if companies can sustain the types of social initiatives that they are advocating. Governmental bodies care because they desire to see whether companies can deliver social and environmental benefits more cost effectively than they can through regulatory approaches. [b] Consumers care as well, as they want to pass on a better world to their children, and many want their purchasing to reflect their values.

[a] K. O’Sullivan, “Virtue rewarded: companies are suddenly discovering the profit potential of social responsibility.” CFO , October 2006, pp. 47–52.

[b] Simon Zadek. Doing Good and Doing Well: Making the Business Case for Corporate Citizenship . New York: The Conference Board Research Report, 2000, 1282-00-RR.

The socially responsible investment movement Establishing a positive relationship between corporate social performance (CSP) and corporate financial performance (CFP) has been a long-standing pursuit of researchers. This endeavor has been described as a “30-year quest for an empirical relationship between a corporation’s social initiatives and its financial performance.” [2] One comprehensive review and assessment of studies exploring the CSP-CFP relationship concludes that there is a positive relationship between CSP and CFP. [3]

In response to this empirical evidence, in the last decade the investment community, in particular, has witnessed the growth of a cadre of socially responsible investment funds (SRI), whose dedicated investment strategy is focused on businesses with a solid track record of CSR-oriented initiatives. Today, the debate on the business case for CSR is clearly influenced by these new market trends: to raise capital, these players promote the belief of a strong correlation between social and financial performance. [4]

As the SRI movement becomes more influential, CSR theories are shifting away from an orientation on ethics (or altruistic rationale) and embracing a performance-driven orientation. In addition, analysis of the value generated by CSR has moved from the macro to the organizational level, where the effects of CSR on firm financial performance are directly experienced. [5]

The CSR of the 1960s and 1970s was motivated by social considerations, not economic ones. “While there was substantial peer pressure among corporations to become more philanthropic, no one claimed that such firms were likely to be more profitable than their less generous competitors.” In contrast, the essence of the new world of CSR is “doing good to do well.” [6]

CSR is evolving into a core business function, central to the firm’s overall strategy and vital to its success. [7] Specifically, CSR addresses the question: “can companies perform better financially by addressing both their core business operations as well as their responsibilities to the broader society?” [8]

One Business Case Just Won’t Do

There is no single CSR business case—no single rationalization for how CSR improves the bottom line. Over the years, researchers have developed many arguments. In general, these arguments can be grouped based on approach, topics addressed, and underlying assumptions about how value is created and defined. According to this categorization, CSR is a viable business choice as it is a tool to:

• implement cost and risk reductions;
• gain competitive advantage;
• develop corporate reputation and legitimacy; and
• seek win-win outcomes through synergistic value creation. [9]

Other widely accepted approaches substantiating the business case include focusing on the empirical research linking CSR with corporate social performance (CSP) and identifying values brought to different stakeholder groups that directly or indirectly benefit the company’s bottom lines.

Broad versus narrow views Some researchers have examined the integration of CSR considerations in the day-to-day business agenda of organizations. The “mainstreaming” of CSR follows from one of three rationales:

• the social values-led model, in which organizations adopt CSR initiatives regarding specific issues for non-economic reasons;
• the business-case model, in which CSR initiatives are primarily assessed in an economic manner and pursued only when there is a clear link to firm financial performance [10] ; and
• the syncretic stewardship model, which combines the social values-led and the business-case models.

The business case model and the syncretic models may be seen as two perspectives of the business case for CSR: one narrow and one broad. The business case model represents the narrow view: CSR is only recognized when there is a clear link to firm financial performance. The syncretic model is broad because it recognizes both direct and indirect relationships between CSR and firm financial performance. The advantage of the broad view is that it enables the firm to identify and exploit opportunities beyond the financial, opportunities that the narrow view would not be able to recognize or justify.

Another advantage of the broad view of the business case, which is illustrated by the syncretic model, is its recognition of the interdependence between business and society. [11]

The failure to recognize such interdependence in favor of pitting business against society leads to reducing the productivity of CSR initiatives. “The prevailing approaches to CSR are so fragmented and so disconnected from business and strategy as to obscure many of the greatest opportunities for companies to benefit society.” [12] The adoption of CSR practices, their integration with firm strategy, and their mainstreaming in the day-to-day business agenda should not be done in a generic manner. Rather, they should be pursued “in the way most appropriate to each firm’s strategy.” [13]

In support of the business case for CSR, the next sections of the report discuss examples of the effect of CSR on firm performance. The discussion is organized according to the framework referenced earlier, which identifies four categories of benefits that firms may attain from engaging in CSR activities. [14]

Reducing Costs and Risks

Cost and risk reduction justifications contend that engaging in certain CSR activities will reduce the firm’s inefficient capital expenditures and exposure to risks. “[T]he primary view is that the demands of stakeholders present potential threats to the viability of the organization, and that corporate economic interests are served by mitigating the threats through a threshold level of social or environmental performance.” [15]

Equal employment opportunity policies and practices CSR activities in the form of equal employment opportunity (EEO) policies and practices enhance long-term shareholder value by reducing costs and risks. The argument is that explicit EEO statements are necessary to illustrate an inclusive policy that reduces employee turnover through improving morale. [16] This argument is consistent with those who observe that “[l]ack of diversity may cause higher turnover and absenteeism from disgruntled employees.” [17]

Energy-saving and other environmentally sound production practices Cost and risk reduction may also be achieved through CSR activities directed at the natural environment. Empirical research shows that being environmentally proactive results in cost and risk reduction. Specifically, data shows hat “being proactive on environmental issues can lower the costs of complying with present and future environmental regulations … [and] … enhance firm efficiencies and drive down operating costs.” [18]

Community relations management Finally, CSR activities directed at managing community relations may also result in cost and risk reductions. [19] For example, building positive community relationships may contribute to the firm’s attaining tax advantages offered by city and county governments to further local investments. In addition, positive community relationships decrease the number of regulations imposed on the firm because the firm is perceived as a sanctioned member of society.

Cost and risk reduction arguments for CSR have been gaining wide acceptance among managers and executives. In a survey of business executives by PricewaterhouseCoopers, 73 percent of the respondents indicated that “cost savings” was one of the top three reasons companies are becoming more socially responsible. [20]

Gaining Competitive Advantage

As used in this section of the report, the term “competitive advantage” is best understood in the context of a differentiation strategy; in other words, the focus is on how firms may use CSR practices to set themselves apart from their competitors. The previous section, which focused on cost and risk reduction, illustrated how CSR practices may be thought of in terms of building a competitive advantage through a cost management strategy. “Competitive advantages” was cited as one of the top two justifications for CSR in a survey of business executives reported in a Fortune survey. [21] In this context, stakeholder demands are seen as opportunities rather than constraints. Firms strategically manage their resources to meet these demands and exploit the opportunities associated with them for the benefit of the firm. [22] This approach to CSR requires firms to integrate their social responsibility initiatives with their broader business strategies.

Reducing costs and risks • Equal employment opportunity policies and practices • Energy-saving and other environmentally sound production practices • Community relations management

Gaining competitive advantage • EEO policies • Customer relations program • Corporate philanthropy

Developing reputation and legitimacy • Corporate philanthropy • Corporate disclosure and transparency practices

Seeking win-win outcomes through synergistic value creation • Charitable giving to education • Stakeholder engagement

EEO policies Companies that build their competitive advantage through unique CSR strategies may have a superior advantage, as the uniqueness of their CSR strategies may serve as a basis for setting the firm apart from its competitors. [23] For example, an explicit statement of EEO policies would have additional benefits to the cost and risk reduction discussed earlier in this report. Such policies would provide the firm with a competitive advantage because “[c]ompanies without inclusive policies may be at a competitive disadvantage in recruiting and retaining employees from the widest talent pool.” [24]

Customer and investor relations programs CSR initiatives can contribute to strengthening a firm’s competitive advantage, its brand loyalty, and its consumer patronage. CSR initiatives also have a positive impact on attracting investment. Many institutional investors “avoid companies or industries that violate their organizational mission, values, or principles… [They also] seek companies with good records on employee relations, environmental stewardship, community involvement, and corporate governance.” [25]

Corporate philanthropy Companies may align their philanthropic activities with their capabilities and core competencies. “In so doing, they avoid distractions from the core business, enhance the efficiency of their charitable activities and assure unique value creation for the beneficiaries.” [26] For example, McKinsey & Co. offers free consulting services to nonprofit organizations in social, cultural, and educational fields. Beneficiaries include public art galleries, colleges, and charitable institutions. [27] Home Depot Inc. provided rebuilding knowhow to the communities victimized by Hurricane Katrina. Strategic philanthropy helps companies gain a competitive advantage and in turn boosts its bottom line. [28]

CSR initiatives enhance a firm’s competitive advantage to the extent that they influence the decisions of the firm’s stakeholders in its favor. Stakeholders may prefer a firm over its competitors specifically due to the firm’s engagement in such CSR initiatives.

Developing Reputation and Legitimacy

Companies may also justify their CSR initiatives on the basis of creating, defending, and sustaining their legitimacy and strong reputations. A business is perceived as legitimate when its activities are congruent with the goals and values of the society in which the business operates. In other words, a business is perceived as legitimate when it fulfills its social responsibilities. [29]

As firms demonstrate their ability to fit in with the communities and cultures in which they operate, they are able to build mutually beneficial relationships with stakeholders. Firms “focus on value creation by leveraging gains in reputation and legitimacy made through aligning stakeholder interests.” [30] Strong reputation and legitimacy sanction the firm to operate in society. CSR activities enhance the ability of a firm to be seen as legitimate in the eyes of consumers, investors, and employees. Time and again, consumers, employees, and investors have shown a distinct preference for companies that take their social responsibilities seriously. A Center for Corporate Citizenship study found that 66 percent of executives thought their social responsibility strategies resulted in improving corporate reputation and saw this as a business benefit. [31]

Corporate philanthropy Corporate philanthropy may be a tool of legitimization. Firms that have negative social performance in the areas of environmental issues and product safety use charitable contributions as a means for building their legitimacy. [32]

Corporate disclosure and transparency practices Corporations have also enhanced their legitimacy and reputation through the disclosure of information regarding their performance on different social and environmental issues, sometimes referred to as sustainability reporting. Corporate social reporting refers to stand-alone reports that provide information regarding a company’s economic, environmental, and social performance. The practice of corporate social reporting has been encouraged by the launch of the Global Reporting Initiative (GRI) in 1997-1998 and the introduction of the United Nations Global Compact in 1999. Through social reporting, firms can document that their operations are consistent with social norms and expectations, and, therefore, are perceived as legitimate.

Seeking Win-Win Outcomes through Synergistic Value Creation

Synergistic value creation arguments focus on exploiting opportunities that reconcile differing stakeholder demands. Firms do this by “connecting stakeholder interests, and creating pluralistic definitions of value for multiple stakeholders simultaneously.” [33] In other words, with a cause big enough, they can unite many potential interest groups.

Charitable giving to education When companies get the “where” and the “how” right, philanthropic activities and competitive advantage become mutually reinforcing and create a virtuous circle. Corporate philanthropy may be used to influence the competitive context of an organization, which allows the organization to improve its competitiveness and at the same time fulfill the needs of some of its stakeholders. For example, in the long run, charitable giving to education improves the quality of human resources available to the firm. Similarly, charitable contributions to community causes eventually result in the creation and preservation of a higher quality of life, which may sustain “sophisticated and demanding local customers.” [34]

The notion of creating win-win outcomes through CSR activities has been raised before. Management expert Peter Drucker argues that “the proper ‘social responsibility’ of business is to … turn a social problem into economic opportunity and economic benefit, into productive capacity, into human competence, into well-paid jobs, and into wealth.” [35] It has been argued that, “it will not be too long before we can begin to assert that the business of business is the creation of sustainable value— economic, social and ecological.” [36]

An example: the win-win perspective adopted by the life sciences firm Novo Group allowed it to pursue its business “[which] is deeply involved in genetic modification and yet maintains highly interactive and constructive relationships with stakeholders and publishes a highly rated environmental and social report each year.” [37]

Stakeholder engagement The win-win perspective on CSR practices aims to satisfy stakeholders’ demands while allowing the firm to pursue financial success. By engaging its stakeholders and satisfying their demands, the firm finds opportunities for profit with the consent and support of its stakeholder environment.

The business case for corporate social responsibility can be made. While it is valuable for a company to engage in CSR for altruistic and ethical justifications, the highly competitive business world in which we live requires that, in allocating resources to socially responsible initiatives, firms continue to consider their own business needs.

In the last decade, in particular, empirical research has brought evidence of the measurable payoff of CSR initiatives on firms as well as their stakeholders. Firms have a variety of reasons for being CSR-attentive. But beyond the many bottom-line benefits outlined here, businesses that adopt CSR practices also benefit our society at large.

[1] See Edward Freeman, Strategic Management: a Stakeholder Approach , 1984, which traces the roots of CSR to the 1960s and 1970s, when many multinationals were formed. (go back)

[2] J. D. Margolis and Walsh, J.P. “Misery loves companies: social initiatives by business.” Administrative Science Quarterly , 48, 2003, pp. 268–305. (go back)

[3] J. F. Mahon and Griffin, J .J. “Painting a portrait: a reply.” Business and Society , 38, 1999, 126–133. (go back)

[4] See, for an overview, Stephen Gates, Jon Lukomnik, and David Pitt- Watson, The New Capitalists: How Citizen Investors Are Reshaping The Business Agenda , Harvard Business School Press, 2006. (go back)

[5] M.P. Lee, “A review of the theories of corporate social responsibility: its evolutionary path and the road ahead”. International Journal of Management Reviews , 10, 2008, 53–73. (go back)

[6] D.J. Vogel, “Is there a market for virtue? The business case for corporate social responsibility.” California Management Review , 47, 2005, pp. 19–45. (go back)

[7] Ibid. (go back)

[8] Elizabeth Kurucz; Colbert, Barry; and Wheeler, David “The Business Case for Corporate Social Responsibility.” Chapter 4 in Crane, A.; McWilliams, A.; Matten, D.; Moon, J. and Siegel, D. The Oxford Handbook of Corporate Social Responsibility. Oxford: Oxford University Press, 2008, 83-112 (go back)

[9] Kurucz, Colbert, and Wheeler , 85-92. (go back)

[10] Berger,I.E., Cunningham, P. and Drumwright, M.E. “Mainstreaming corporate and social responsibility: developing markets for virtue,” California Management Review , 49, 2007, 132-157. (go back)

[11] Ibid. (go back)

[12] M.E. Porter and Kramer, M.R. “Strategy & society: the link between competitive advantage and corporate social responsibility.” Harvard Business Review , 84, 2006,pp. 78–92. (go back)

[13] Ibid. (go back)

[14] Kurucz, Colbert, and Wheeler, 85-92. (go back)

[15] Ibid., 88. (go back)

[16] T. Smith, “Institutional and social investors find common ground. Journal of Investing , 14, 2005, 57–65. (go back)

[17] S. L. Berman, Wicks, A.C., Kotha, S. and Jones, T.M. “Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance.” Academy of Management Journal , 42, 1999, 490. (go back)

[18] Ibid. (go back)

[19] Ibid. (go back)

[20] Top 10 Reasons, PricewaterhouseCoopers 2002 Sustainability Survey Report, reported in “Corporate America’s Social Conscience,” Fortune , May 26, 2003, 58. (go back)

[21] Top 10 Reasons . (go back)

[22] Kurucz, Colbert, and Wheeler (go back)

[23] N. Smith, 2003, 67. (go back)

[24] T. Smith, 2005, 60. (go back)

[25] Ibid., 64. (go back)

[26] Heike Bruch and Walter, Frank (2005). “The Keys to Rethinking Corporate Philanthropy.” MIT Sloan Management Review , 47(1): 48-56 (go back)

[27] Ibid., 50. (go back)

[28] Bruce Seifert, Morris, Sara A.; and Bartkus, Barbara R. (2003). “Comparing Big Givers and Small Givers: Financial Correlates of Corporate Philanthropy.” Journal of Business Ethics , 45(3): 195-211. (go back)

[29] Archie B. Carroll and Ann K. Buchholtz, Business and Society: Ethics, Sustainability and Stakeholder Management , 8th Edition, Mason, OH: South-Western Cengage Learning, 2012, 305. (go back)

[30] Kurucz, Colbert, and Wheeler, 90. (go back)

[31] “Managing Corporate Citizenship as a Business Strategy,” Boston: Center for Corporate Citizenship, 2010. (go back)

[32] Jennifer C. Chen, Dennis M.; & Roberts, Robin. “Corporate Charitable Contributions: A Corporate Social Performance or Legitimacy Strategy?” Journal of Business Ethics , 2008, 131-144. (go back)

[33] Kurucz, Colbert, and Wheeler , 91. (go back)

[34] Porter and Kramer, 60-65. (go back)

[35] Peter F. Drucker, “The New Meaning of Corporate Social Responsibility.” California Management Review , 1984, 26: 53-63 (go back)

[36] C. Wheeler, B. Colbert, and R. E. Freeman. “Focusing on Value: Reconciling Corporate Social Responsibility, Sustainability and a Stakeholder Approach in a Network World.” Journal of General Management , (28)3, 2003, 1-28. (go back)

[37] Ibid. (go back)

Nice blog. CSR has become something very important to all the corporate houses today. However, with the rising growth of CSR activities. It is very important to have an effective software that helps to keep a track of the entire exercise.

Interesting article! Perhaps nice to give Mr. Stephen ‘Gates’ his real name back? After all “The New Capitalists: How Citizen Investors Are Reshaping The Business Agenda” was written by Stephen DAVIS. I think he would like the recognition ;)

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12 examples of corporate social responsibility done right

And how to build your own csr strategy.

A few years ago, my parents switched toilet paper brands. While this is surely fascinating information for you personally, it's relevant here because they switched to "Who Gives A Crap," a company that donates 50% of its profits to building toilets and improving sanitation in developing countries.

After exploring lots of brands that use this strategy well, I compiled some of my favorite corporate social responsibility examples. These businesses do good for others while still doing good for themselves.

Table of contents:

What is corporate social responsibility (CSR)?

Corporate social responsibility (CSR) is a business model where for-profit organizations use company resources to benefit society while still pursuing corporate goals.

You've certainly heard of "the bottom line" in the corporate world—it's all about profit. CSR-oriented companies abide by a "triple bottom line" that encompasses two other "P" words: people , whether that be the company's employees or the population at large, and the planet , incorporating environmental, social, and governance (ESG) factors into their operations.

Sustainable manufacturing

Social justice advocacy

Product innovation for environmental or social issues

Carbon footprint reduction

Donating significant profits to charity

12 corporate social responsibility examples

There are companies that throw half a percent of their earnings at a random charity, and then there are those that build their entire business model around societal advancement and really get their hands dirty. Here are 12 socially responsible companies that inspire with their CSR.

1. Ben & Jerry's

But the brand didn't jump right into the deep end from its inception. From its humble beginnings in the late 1970s until today, the company has gradually advocated for more causes, now including voter rights, climate justice, LGBTQ+ rights, and many more—all while maintaining its brand presence.

Gradually take on new social initiatives rather than spreading your resources too thin all at once.

Develop an approachable personality for your brand through your tone and design.

2. Who Gives A Crap

But the brand name and tone aren't what make it a socially responsible company. The founders are committed to building toilets and improving sanitation in developing countries to the point that they devote 50% of their profits to this mission, hence their status as a B Corp.

Like many other companies with great CSR, they also strive to be environmentally friendly, using plastic-free products and using sustainable materials like bamboo and recycled paper to manufacture toilet paper (among other paper products like tissues and paper towels).

CSR doesn't have to be serious stuff. Be authentic and honest with your brand's tone.

3. Tom's of Maine

Tom's is also a great example of companies with high CSR standards banding together. The brand partners with TerraCycle, a recycling company, encouraging customers to recycle items that your average waste management company won't take in order to redeem for charity donations. Since both companies emphasize sustainability and eco-friendliness, they go together like mint and toothpaste.

When thinking about innovation, consider CSR—how can you innovate in a way that's also socially responsible?

Partner with relevant, like-minded organizations that also practice CSR.

Most retailers produce clothing with a few narrowly defined body types and presentations in mind. Most people don't fit those molds.

The company holds true to this value in its hiring practices as well, with 80% of its C-suite being women and 63% of managers identifying as LGBTQ+ and/or minority. The brand is also committed to sustainability, forming close relationships with its factories and striving to source organic and recyclable fabrics.

Having personal experience with a social issue makes it far easier to build your business around it. Focus on what matters to you personally.

Develop hiring practices that reflect your company's commitment to CSR.

5. Allbirds

The brand emphasizes sustainability not only in its production, but also in the way it treats its workers. The brand has a strict code of conduct regarding the ethical treatment of employees and frequently visits and audits those factories to ensure their standards are being met.

Create both short- and long-term CSR goals.

Commit to your cause in a well-rounded way, not just focusing on one area of your business.

6. Rent the Runway

For those who regularly enjoy galas and nights out on the town, the brand offers a membership program that keeps its members equipped with a rotating selection of four outfits at a time.

Rent the Runway's mission is closely tied to sustainability. Too often, people purchase an outfit for a single event and then proceed to never wear that outfit again, resulting in textile waste. The company allows several people to enjoy an outfit for an evening out without making them pay top-dollar to purchase it. The brand now also offsets 100% of carbon emissions from shipments and aims to operate with net zero carbon emissions by 2040.

You can be socially responsible without shying away from profitable strategies like a membership-based business model.

Industries that produce a lot of waste offer the greatest opportunity for sustainability innovation.

Hive notifies customers of their eco-friendly impact statistics after every purchase, providing them with a sense of accomplishment and satisfaction. And the dopamine rush doesn't end there—Hive ships its products in cute cardboard boxes filled with recyclable packaging materials that resemble honeycomb. I've ordered a few boxes myself, and I can honestly say that opening a Hive box takes me back to being a kid on Christmas morning.

Lift the curtain for your customers, so they can feel like they're a part of your mission.

8. BLK + GRN

Develop your mission to solve a problem for a specific audience.

Educate others about your cause rather than just producing products that support it.

9. Patagonia

Don't be afraid to do something unprecedented if it means making a bigger impact. 

Think long-term to ensure your company's values won't change with new leadership. 

10. Cariuma

Even if you just subscribe to its email newsletter, Cariuma will plant a tree in the Brazilian rainforest in your name. From ethical factories to carbon-neutral shipping, the company is a stellar example that you don't have to compromise on style or substance to be environmentally responsible.

Create tangible measures of impact, like planting trees for each purchase, to make your CSR efforts more transparent and engaging.

Innovate your products to be both sustainable and appealing, proving that eco-friendliness and style can coexist.

11. Giv Coffee

At the heart of Giv Coffee's mission is a commitment to cultivating long-term relationships with coffee farmers. They go beyond fair trade practices by consistently buying from the same growers year after year and paying prices that both parties agree on. This gives farmers financial stability and the opportunity to improve their lives and communities.

Giv's impact isn't limited to sourcing beans. They donate a portion of every sale to those in need, making indulging in your coffee habit a charitable act. Next time someone asks if you've had your morning coffee, you can say, "Yes, and I've also helped stabilize an entire community's economy. What have you done today?"

Develop long-term, direct relationships with suppliers to create more impactful and sustainable sourcing practices.

Integrate giving directly into your business model to create a clear connection between purchases and social impact.

12. The Loading Dock

The Loading Dock walks the talk by sticking to sustainable practices, committing to local purchasing, and uplifting minority-owned businesses. It also donates 2% of its revenue to community-building nonprofits, emphasizes diversity in hiring, and provides quarterly volunteer opportunities for staff and members, all in the name of making a difference.

Create a community around your corporate social responsibility efforts to amplify your impact and inspire others.

Try to integrate social responsibility into every aspect of your business, from hiring practices to purchasing decisions.

Types of corporate social responsibility

Environmental: Businesses in this category focus on making a positive environmental impact. They adopt renewables, "cradle to grave" manufacturing principles, carbon offsets, and sustainable sourcing.

Philanthropic: Philanthropic businesses devote themselves to making a positive social impact. They often fund non-profits like universities, museums, arts programs, charities, and other cultural institutions. They might also provide grants and scholarships.

Ethical: Companies with strong ethical standards may go as far as codifying their ethics within their corporate structure to show their commitment to align with these values. For example, a company may establish in writing that it will never source materials from suppliers that mistreat their workers.

Economic: Companies committed to economic responsibility understand where their dollars are going and what impact they're having across the value chain. They believe it's important to pay their employees fair wages, and they exercise good stewardship with their profit.

How to build a CSR business model

Don't just throw CSR against your business's wall and hope it sticks—it has to be implemented strategically.

Most importantly, ensure your approach aligns with your resources and brand image. For example, Who Gives A Crap chose a philanthropic goal relevant to its product offering. The brand name itself reflects both of these efforts and does so in a creative and witty way.

You should also be wary of half-baked initiatives and the temptation to cut corners. Many brands simply throw an eco-friendly label on their packaging (a strategy known as greenwashing), whereas Hive carefully inspects all of its products to make sure they're actually being kind to the earth and its people. 

Taking these steps will ultimately benefit you. If you execute CSR strategically, you can become a Certified B Corp, improving your business's reputation and attracting new customers.

Corporate social responsibility FAQ

Have a few more questions about corporate social responsibility? Here are some closing takeaways.

What are examples of corporate social responsibility?

Patagonia handing the company over to a trust dedicated to addressing climate change; BLK + GRN educating consumers on the toxic ingredients often included in personal care products marketed to Black women; Allbirds working to be zero-emissions by 2030—examples of corporate social responsibility run the gamut. CSR can be achieved through initiatives such as advocating for social causes, ethical production, and donating profits to environmental efforts, but it's not limited to any specific actions.

What is an example of a CSR statement?

An example of a CSR statement is Patagonia's mission statement: "We're in business to save our home planet." It explicitly articulates its purpose beyond profit, conveys a commitment to environmental preservation as a central driver of its business activities, and demonstrates a genuine dedication to addressing pressing societal challenges. Putting CSR at the forefront of your mission statement is a great way to show you mean (responsible) business.

What is the main purpose of corporate social responsibility?

The main purpose of corporate social responsibility is for companies to weave ethical, environmental, and social considerations into how they do business. The idea is to make a positive impact on society while growing sustainably and rocking the long game.

Related reading:

This article was originally published in June 2021 by Jeremy Ducheney and has also had contributions from Cecilia Gillen and Allisa Boulette. The most recent update was in September 2024.

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A Casebook of Strategic Corporate Social Responsibility

Towards Business Sustainability

• © 2022
• Ananda Das Gupta 0

Indian Institute of Plantation Management, Bengaluru, India

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• Presents cases demonstrating profitable and sustainable partnerships from around the globe
• Emphasizes the concept of a truly connected (or “flat”) world
• Combines strategic business approach with philosophical fundamentals providing context & substance for ethical analysis

Part of the book series: CSR, Sustainability, Ethics & Governance (CSEG)

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About this book

This casebook argues that corporate sustainability agendas should look beyond stakeholder demands and desires, towards strategic opportunities to achieve social and commercial benefits simultaneously. It encourages shifting focus from a strategic approach to a sustainable business practice. As the cases in the book highlight, it is in every company’s best interest to identify a manageable number of sustainability initiatives whose shared benefits—for society at large and the company—are significant and also substantially help the company strategically position itself in the competitive marketplace. Strategic sustainable business practices can lead to shared value creation, strengthening the company’s competitiveness and establishing a symbiotic relationship. Companies can achieve solid profits by doing good things for the environment; it is a “win-win” for society and for business. This casebook provides examples of multi-stakeholder partnerships that aim to create sustainable enterprises. Ideal for teaching purposes, after a brief introduction to the case method, the cases are presented with no comments or criticisms.

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• Corporate Social Responsibility

Table of contents (11 chapters)

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Can CSR Help Address Farmer Suicides? An Indian Case Study

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Editors and Affiliations

About the editor.

The International Scholars include: Prof. Stuart Hart , Cornell University; Prof. Aneel Karnani , University of Michigan; Prof. Theodore  Roosevelt Mullock , Yale University; Prof. Nicholas Capaldi , Loyola University, among others.

Bibliographic Information

Book Title : A Casebook of Strategic Corporate Social Responsibility

Book Subtitle : Towards Business Sustainability

Editors : Ananda Das Gupta

Series Title : CSR, Sustainability, Ethics & Governance

DOI : https://doi.org/10.1007/978-981-16-5719-1

Publisher : Springer Singapore

eBook Packages : Religion and Philosophy , Philosophy and Religion (R0)

Copyright Information : Springer Nature Singapore Pte Ltd. 2022

Hardcover ISBN : 978-981-16-5718-4 Published: 05 December 2021

Softcover ISBN : 978-981-16-5721-4 Published: 06 December 2022

eBook ISBN : 978-981-16-5719-1 Published: 04 December 2021

Series ISSN : 2196-7075

Series E-ISSN : 2196-7083

Edition Number : 1

Number of Pages : X, 186

Number of Illustrations : 14 b/w illustrations, 17 illustrations in colour

Topics : Business Ethics , Business Strategy/Leadership , Organizational Studies, Economic Sociology , Ethics , Administration, Organization and Leadership

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Making the Business Case for Sustainability

• 13 Apr 2021

Once thought to be opposing goals, sustainability and financial success now go hand-in-hand for many businesses. Some, however, may be skeptical of the claim that a business can do well by doing good. How can you make the business case for sustainable practices to skeptical decision-makers in your organization?

Here are key terms to use to frame your discussion, several ways sustainable business practices can pay off financially, and tools to leverage when pitching sustainability to stakeholders.

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Corporate Social Responsibility and the Triple Bottom Line

Corporate social responsibility (CSR) is a business model in which for-profit companies seek to create social and environmental benefits while pursuing organizational goals. Whereas companies typically focus on the bottom line, or generating profit, socially responsible corporations focus on the triple bottom line.

The triple bottom line can be described as the “three Ps”: people, the planet, and profit. In other words, in addition to striving to succeed financially, socially responsible companies commit to measuring success through their impact on people—employees, customers, and society at large—and the environment.

It’s important to not think of sustainability initiatives as a financial trade-off, but rather, as a wise financial strategy.

“There’s good reason to believe that solving the world’s problems presents trillions of dollars’ worth of economic opportunity,” says Harvard Business School Professor Rebecca Henderson in the online course Sustainable Business Strategy .

Leading with purpose can positively impact both the planet and your business’s financials. Here are eight benefits of a sustainable business strategy you can use when making the case to your internal team.

8 Benefits of Sustainability in Business

1. drives internal innovation.

Making the switch to sustainable business practices provides an opportunity for new, innovative ideas to grow. Consider this your chance to question the way your organization operates. Are there inefficiencies in your production process? Are there alternatives to how you currently source production materials? What equipment or technology could make your internal processes and product delivery more energy efficient?

These types of questions reveal opportunities to save money on energy and reassess how ethically you source materials. They can also shake up your mindset of “this is how we’ve always done it” and prompt innovative ideas for new business opportunities.

Related: 23 Resources for Mobilizing Innovation in Your Organization

2. Improves Environmental and Supply Risk

Investing in more sustainable practices can pay off in the form of risk management. By using renewable resources—such as wind, water, and solar power—your company has greater security over its energy sources.

This can also offer financial benefits. For example, if your company switches from coal to clean energy, like ice cream company Ben & Jerry’s , you can avoid the hassle and cost when coal prices skyrocket.

3. Attracts and Retains Employees

Being a sustainable company can have a big impact on the talent you attract and retain. A recent survey conducted by clean energy company Swytch found that nearly 70 percent of employees report that their company’s strong sustainability program impacts their decision to stay with it long term.

The same survey reports that 75 percent of millennials—who will make up three-quarters of the workforce in five years—would take a decrease in salary if it meant working for an environmentally responsible company. Nearly 40 percent selected one job over another because of an organization’s sustainability practices.

Committing to sustainability puts your company’s values at the forefront, which can attract employees and job seekers who share those values. Hiring and retaining the right team can save your organization the time and money of having to rehire for multiple roles.

4. Expands Audience Reach and Builds Brand Loyalty

A focus on sustainability can not only help attract and keep the right employees, but build a broader, more loyal customer base.

Research in the Harvard Business Review shows that sustainable businesses see greater financial gains than their unsustainable counterparts. In addition, consumers’ motivation to buy from sustainable brands is on the rise. For instance, products with an on-package sustainability claim delivered nearly $114 billion in sales in 2019—a 29 percent increase from 2013—and products marketed as sustainable grew more than five times faster than those that weren’t.

Adopting sustainable practices and marketing appropriately can enable your business to reach new, sustainably-minded market segments while building brand loyalty among your customer base.

5. Reduces Production Costs

One of the simplest business cases for sustainability is that using fewer resources, or more sustainable ones, can decrease production costs.

Examining your supply chain, production process, and energy use at brick-and-mortar stores and office buildings can help identify places where cutting back on finite resources and switching to greener alternatives is a cheaper option.

“Some firms invest in sustainability because the business case is so glaringly obvious, they’d be foolish not to,” Henderson says in Sustainable Business Strategy.

6. Garners Positive Publicity

Another outcome of opting for sustainability is the positive publicity it can garner. Especially if it’s a divergence from your business’s previously established practices or industry standards, your switch to sustainability and investment in the environment can call for press releases and announcements.

Side effects of this positive publicity can be employee pride, sustainably-minded job applicants, and increased customer loyalty and referral rates.

7. Helps You Stand Out in a Competitive Market

In a competitive market, any way to differentiate your product and brand from your competitors is valuable. Sustainable business practices can be a positive way to stand out if your competitors haven’t adopted those practices themselves or match them if they’ve already made the switch to sustainability.

Calling back to research in the Harvard Business Review , consumers’ focus on brands’ sustainability practices is on the rise, and your business’s practices could be the sole reason consumers choose your product over your competitors’.

8. Sets the Industry Trend

Sustainability not only helps your company stand out against competitors but also influences their behaviors. If your organization is one of the first in its field to adopt sustainable practices, it could set your business apart as a trend-setting leader and prompt other companies to follow suit.

“The leaders, the firms who are driving real change and reaping the benefits of being first-movers are often as motivated by a driving desire to make a difference as they are by the wish to make money,” Henderson says in Sustainable Business Strategy.

If the sustainability trend continues, it could become the norm in your industry. When many corporations adopt sustainable practices, they have the potential to make a real impact on the world’s largest problems.

Tools for Pitching a Sustainable Business Strategy

When pitching sustainability to internal decision-makers, use the data, projections, and anecdotal evidence at your disposal. Here are a few tools to help you make your case.

1. Data Visualizations

Data visualizations are graphical representations of data. When making the case for sustainability, you may create a graph that shows the increasing prices of fossil fuels, a chart that shows consumer preferences for sustainable companies, or a visual forecast of what future revenue could look like if a piece of sustainable technology were purchased.

Some data visualization tools you can use are:

• Microsoft Excel & Power BI
• Google Charts
• Zoho Analytics
• Datawrapper

Visualizations are a clear, concise way to tell the story of why you should adopt a sustainable business strategy.

Related: Bad Data Visualization: 5 Examples of Misleading Data

2. Anticipated Return on Investment Formula

When advocating for specific sustainability projects or equipment purchases, it can be useful to calculate the anticipated return on investment (ROI) . Calculating the anticipated ROI shows internal stakeholders how much financial return the business can expect as a result of investing in the sustainable practices you’re proposing.

To calculate anticipated ROI, use the following formula:

ROI = (Net Profit / Cost of Investment) x 100

In project management, the formula is written similarly but with slightly different terms:

ROI = [(Financial Value - Project Cost) / Project Cost] x 100

3. Case Studies of Businesses with Successful Sustainability Initiatives

Real-world examples can go a long way when proposing new ideas. There are plenty of businesses that have successfully executed sustainability initiatives and put the triple bottom line at the forefront of their business strategies. A few examples include:

• Bank of America
• AstraZeneca
• Ben & Jerry’s
• Levi Strauss

Dig deeper into what made these firms’ efforts successful, and use that as fuel for your company’s strategy.

Furthering Your Sustainable Business Education

If you and your colleagues want a strong foundation for making the shift to sustainable business, consider taking Sustainable Business Strategy . The online course presents groundbreaking concepts using the HBS case method and asserts that sustainable capitalism has the power to influence the world’s most pressing challenges.

By bolstering your knowledge of the space, your organization could become one of the many success stories of those that create shared value from sustainable business practices.

Are you interested in leading your business to a more sustainable future? Explore our three-week online course Sustainable Business Strategy to become a purpose-driven leader.

About the Author

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Please note you do not have access to teaching notes, corporate social responsibility and consumerism: case examples from hyatt, scandic and walt disney.

Worldwide Hospitality and Tourism Themes

ISSN : 1755-4217

Article publication date: 23 July 2020

Issue publication date: 15 December 2020

The concepts of corporate social responsibility (CSR) and their link to the United Nations sustainable development goals (UN SDGs) are increasingly important, however prior research on this topic is limited, especially in the hospitality industry. The purpose of this paper is to contribute to greater knowledge on the subject and determine how other hospitality organizations should move forward the two topics were researched using a framework relating to the triple-bottom-line concept with reference to case studies of three hospitality corporations – Hyatt Hotels Corporation, Scandic Hotels AB and the Walt Disney Company.

Design/methodology/approach

Most large hotel corporations now report their CSR activities on their corporate websites, which is the most accessible format to find information on activities, and so secondary research was conducted to draw on this. Additional secondary research was undertaken from October 2019 – May 2020 using a number of journal databases including Sage Journals, Emerald Journals, the E-library of the UNWTO and Taylor and Francis Academic Journals. Third-party sites were also leveraged including CSR-Hub, The United Nations and Forbes.

While all three corporations mention their efforts in relation to the sustainable development goals, commitment on what activities contribute to which goals was difficult to discern. Furthermore, while there are some activities that all three contribute to, there are many best practices that could be shared across the industry.

Originality/value

Though the research was limited to secondary sources, the topic is largely unresearched and has the potential to suggest best-practices available more widely across the industry.

• Triple bottom line
• Corporate social responsibility
• Hospitality
• Sustainable development goals
• Hyatt hotels corporation
• Walt Disney company
• Scandic hotels AB

Luiten, S.-C. (2020), "Corporate social responsibility and consumerism: case examples from Hyatt, Scandic and Walt Disney", Worldwide Hospitality and Tourism Themes , Vol. 12 No. 5, pp. 547-562. https://doi.org/10.1108/WHATT-06-2020-0045

Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

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Best csr practices in canada: six case studies.

This Report on “Best CSR Practices in Canada: Six Case Studies” provides insights into leading Canadian companies advancing their Corporate Social Responsibility (CSR) impacts.

Leading CSR in Canada is underdoing a strategic pivot from corporate efforts to embed social and environmental considerations in governance, risk, strategy, decisions, functions, products, supply chains and operations to the embedment of societal or humanitarian ambitions in the core purpose of the company. This approach to CSR embeds CSR in the “business model” and influences everything across the company and the role the company plays to influence and transform its industry, communities and ecosystem for good. It is called Social Purpose.

This was one of the main conclusions drawn from a 2018 research project which studied recent and projected shifts in CSR among 32 leading CSR companies across Canada . Following up on this research, the Federal Government commissioned (and contributed to) “Best CSR Practices in Canada: Six Case Studies” of companies demonstrating this shift from CSR to “social purpose”.

These companies include:

• Chandos Construction (Alta)
• Libro Credit Union (Ont)
• Maple Leaf Foods (Ont)
• Mills Office Productivity (BC)
• Vancity Credit Union (BC)

“Best CSR Practices in Canada: Six Case Studies” profiles current efforts in the following areas:

• Social Purpose
• Community Partnerships
• Social Innovation
• Lessons Learned

“Reading Best CSR Practices in Canada: Six Case Studies” will give you insights into emerging good CSR practices you can pursue at your company.

Do you know someone who may be interested in this? Share it.

Strandberg Consulting Coro Strandberg, President

604.433.7339 [email protected]

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