What is Corporate Responsibility?

Introduction

All corporations have some type of duty they fulfill and there are 4 main types. The company's purpose can also impact their corporate responsibilities. This article will cover what corporation responsibility is, the various corporate commitments, and real life examples of corporate responsibility.

What is Corporate Responsibility?

Corporate Responsibility is a business model that helps the corporation be responsible members with themselves, stakeholders, clients, and the public. Utilizing this business model ensures that they are mindful of their company's social, economic, and environmental impact on their community. They are not only trying to maximize profit but make the community a better place. In addition, companies with corporate responsibility boost their employee's morale. Morale is raised because it gives employees a purpose to work for the company and shows their employment is meaningful within the community. Companies that take corporate responsibility will provide them with sound recognition and attract many customers and clients.

The Types of Corporate Responsibility

Companies, depending on their purpose, may want to partake in different types of corporate responsibilities. There are four primary corporate responsibilities:

Ethical

Ethical Responsibility is participating in business practices that are ethical to employees, shareholders, and clients. Companies that not only follow their state or country's business laws but also cultural morals and do the right thing helps to boost the success in the company.

Environmental

Companies that work to better the environment are doing environmental responsibilities. They take steps toward reducing global warming, deforestation, and other issues that affect the planet. They don't only follow the three Rs (reuse, reduce, recycle), but work towards making their company eco-friendly.

Economic

Economic Responsibility is where the company makes financial decisions that benefit the economy. In addition to making a profit, the company pays attention to providing fair wages to employees and reasonable prices to their customers.

Philanthropic

Philanthropic Responsibility aligns closely with environmental responsibility but extends toward improving people's lives in the community. The company's purpose and values heavily influence philanthropic responsibility. Philanthropic responsibility can relate to the three types listed above and can make the community a better place overall.

Examples of Companies doing Corporate Responsibility

Starbucks

Starbucks is a well-known coffee chain in the US and heavily works towards ethical business methods. In 2015 they verified that their coffee supply is 99% ethically sourced. Starbucks has also been doing local philanthropic activities, such as community stores aiming to assist non-profit organizations that provide educational training to low-income families to eradicate poverty.

Ben and Jerry’s

Ben and Jerry's is an ice cream brand that has become a certified B corporation which is a business that balances its profit and exceeds standards in social, environmental, and ethical corporate Responsibility. The company awards 2.5 million dollars in grants to organizations improving humanity.

Google and Apple

These two companies are big tech companies that can consume lots of natural resources in order for the company to operate. However, both companies have been showing significant environmental corporate responsibility: Google has ensured they are carbon neutral, while Apple created green office spaces.

Benefits

Companies doing Corporate Responsibility help the community and the environment, but there are noticeable benefits from doing these responsibilities:

1. Corporate Responsibility improves company brand and makes companies stand out from other companies.
2. Companies will be able to promote innovation by employees.
3. Corporations will be able to attract talented employees because workers will be more likely to join companies that will create an impact on the world.
4. Companies will be able to increase employee productivity and morale because they will have something to work towards and are making a difference.

Takeaways

Corporate Responsibility are the activities that a company does to better its environment and community. There are four main corporate responsibility types; each type makes a meaningful difference and improves humanity. Corporations' values and mission heavily affect their corporate responsibility, and corporations help their community and help themselves when they follow through with their corporate duties.