Impakt | The Ripple Effects of a Comprehensive Social Impact Strategy
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The Ripple Effects of a Comprehensive Social Impact Strategy

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The Ripple Effects of a Comprehensive Social Impact Strategy

By: Irene Ferro

 

“I alone cannot change the world, but I can cast a stone cross waters to create many ripples.” – Mother Teresa

 

 

We’re beginning to see a change in how the business world – across various industries – engages with social impact. What began as Corporate Social Responsibility (CSR), mostly a reactive response to negative press or other consequences of irresponsible business practices, there is now an increasing trend of incorporating a more comprehensive strategy for necessary social impact. Companies are engaging in this space differently, with a marked move towards more holistic and comprehensive social impact strategies as the clear and growing trend.

 

 

By embedding social impact into company-wide philosophies, organizations can ensure that being responsible corporate citizens reaches farther and wider than the more traditional CSR programs would – a ripple effect, if you will. This isn’t to say that more traditional CSR programs should be eliminated altogether; they should instead become one arm of a multi-faceted, more inclusive social impact strategy. Instead of CSR functioning in silo, once companies saw that embedding social impact into their philosophy and operations, they not only were able to make a more meaningful impact, but also saw a ripple effect across various stakeholders of the organizations, such as employees, companies, communities, and society in general.

 

 

Employees

While the push for change towards a more socially minded company culture must begin and be implemented from the top, the demand for social action in an organization is increasingly being driven from the bottom up. Reporting shows that a majority of millennials, a demographic that will make up 75% of the workforce by 2025, heavily weigh corporate citizenship and socially conscious values over pay grades. Additionally, they are more loyal, feel more fulfilled and are more productive if their employer has strong corporate citizenship engagements and social impact strategies. So, in order to attract and retain top talent, companies need to demonstrate their genuine and authentic commitment to using their profits, products and services to create lasting and meaningful impact, be it locally or around the world.

 

 

Customers/Consumers

Another group also becoming increasingly concerned with socially conscious behaviours are customers or consumers of particular brands. We’ve seen outrage over unsafe and unfair working conditions in the textile industry and increasing concerns with environmentally sustainable practices in the extractive sector. The effects customers are having on companies is two-fold. First, due to the ever-connected world we live in, customers around the world can become aware of malpractice by certain brands or companies, regardless of how far away it may be happening, creating public outrage and negative repercussions on brands. This forces companies to reckon with their irresponsible practices and make substantial changes to stay competitive and regain customer trust. The second is that customers are emphasizing sustainable lifestyles, and looking to all types of companies to help them achieve that. I would classify this as more positive pressure, encouraging companies to improve their modus operandi. Ensuring buildings are ‘green’, workers are paid fair wages, vulnerable communities are receiving needed resources, and packaging is reducing environmental footprints are all examples of demands customers continue to make on brands. By demonstrating to their customers that they are committed to creating social impact, and taking social and environmental precautions across supply chains and production, companies will have better customer engagement, retention and business growth.

 

 

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Communities

Another mutual benefit to the ripple effect will be better engagement with local communities. Many global brands rely on complex international supply chains to deliver their products or services, affecting many different types of communities around the world. Ensuring that the communities responsible for their raw materials, supplying their resources, and making their products are benefitting from the business, rather than suffering or being exploited, is important for the sustainability and growth of business in these communities (and, as mentioned above, for customers). Additionally, companies are investing in communities in previously underserved regions of the world. Whether they’re doing this to create relationships with the business community and government in a new market, or to tap into previously untapped markets or resources, these investments are mutually beneficial. One example is IBM’s recent launch of a new corporate citizenship program, IBM Health Corps. By focusing resources on a “global pro bono program focused on tackling health disparities” IBM is expanding its partnerships in the health sector, engaging in ground-breaking and innovative health work, and providing much needed health assistance to communities worldwide.

 

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Society

These bottom-up pressures and more socially-conscious business decisions are creating ripples of social consciousness across society. We’ve seen governments looking to engage with businesses around social and environmental issues, sharing responsibilities and innovating creative new strategies. We’ve also seen a marked change in how brands engage with political and social issues, ranging from climate change (Patagonia’s CEO donated the $10MM in savings from tax cuts to environmental groups)  to racial inequality (Nike’s 2018 campaign featuring Colin Kaepernick, famously criticized for protesting racial inequality in the United States by kneeling during the national anthem). While some of 2018’s most buzz-worthy brand moments are seen in a political light, they also demonstrate brands’ understanding of the influence they can have on society, and vice versa. Campaigns like Nike and Patagonia are putting social impact issues at the forefront of their brand recognition strategies, and it’s paying off.

 

 

Once businesses understood that doing good and good business were not mutually exclusive concepts, but instead mutually beneficial ones, companies spanning size, sectors and regions began, slowly but surely, incorporating these strategies into their very ethos. In the days following the unveiling of the Colin Kaepernick campaign, Nike’s sales rose by 31%. In the last 5 years, Unliever has launched hygiene education and water purifying programs in the developing world, reflecting the fact that 55% of the company’s revenue comes from emerging markets. Products associated to these campaigns experienced significant growth and are the company’s fastest growing brands. These are just two of many examples demonstrating how businesses benefit from comprehensive social impact strategies. By embedding social impact into company-wide culture, strategies, and best practices, we’re beginning to see just how far they can reach.

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