Social impact is now a core part of business strategy. Discover how businesses can align impact with long-term success for a future-forward win-win.
If there’s any remaining doubt that social impact is now a critical business imperative, here are some facts for you, as reported by Forbes:
- 87% of consumers would make a positive buying decision based on a company’s advocacy of a social issue.
- By contrast, 76% would reject a company if its views or values conflicted with their own.
- 76% of people want businesses to address social issues.
While companies and organizations have been implementing CSR initiatives for some time now, business strategies for social impact are now an absolute must-have. They are now no less important a metric for growth than customer service or product quality.
Yet some sectors, it appears, have not yet fully caught up with the latest business ideas for social impact. There’s even a disconnect between some sectors’ ongoing use of traditional business models and what their customer base is looking for. If they ignore that gap, businesses will miss out.
Types of social impact
There are a number of different ways that an organization can build social impact into strategy to simultaneously drive positive change and growth. Perhaps the closest to home is ethical labor practices. The benefits of building an ethical company are well documented, including attracting and retaining high-quality employees, greater attraction to potential investors and more trust in the brand from consumers.
Another form of business strategy for social impact is the creation of a circular economy, in which materials are kept in use for as long as they can be reused or recycled. This approach minimizes waste and boosts profits and customer satisfaction alike.
Environmental sustainability, meanwhile, covers everything from reducing waste and emissions to adopting renewable energy sources and sustainable supply chains, which really matters to customers.
Then there’s philanthropy and community engagement. Positive connections with the communities in which they operate does more than merely enhance a company’s brand image. As we’ve seen, modern consumers are often more likely to support organizations they see as socially responsible. What’s more, in many countries such as the US, corporate charity can be tax-deductible, so there’s also a purely financial imperative to business strategies for social impact.
Business ideas with social impact
Having the intent is one thing. But how can businesses align their corporate objectives with their desire to integrate social impact in their everyday activities? Success in this area starts with genuine commitment to the process. Any organization that treats social impact initiatives as a layer of protection—as Forbes puts it, “like a cellphone case” for the firm’s reputation—rather than as an integral element of corporate strategy, is bound to fail in its endeavors.
Forbes also points out that many successful ESG/CSR initiatives are quickly imitated or even outright copied by competitors. Analysis of their own processes, objectives and culture could help companies identify social impact business initiatives that are unique to them, harder to emulate, and wouldn’t necessarily even work at another company.
Incentivizing social impact
It’s one thing to encourage employees to buy into a culture of social responsibility. But it’s quite another to actually build incentives that reward positive social impact into remuneration policies. Large companies in sectors that are typically pollutive and heavily regulated, such as oil and gas, have linked executive incentives to carbon emissions, for example.
Meanwhile, some of the biggest names in tech now tie executive compensation to workforce diversity targets. This is not only a powerful social impact metric; it’s clearly demonstrated as benefiting every business through the innovative thinking, new ways of problem-solving and creativity inherent in a diverse workforce.
Arming people with the right skills
Potential employers failing to share their values has been described as a “dealbreaker” for modern young talent. Many of the best minds simply will not work for a company that conflicts with their ideals. That means that not only are organizations upskilling their own staff with the competencies, knowledge and experience to drive social change, but that potential employees are also preparing their professional pathways with these skills from the start.
Seeing business as a powerful tool for positive change, aspiring future leaders are proactively seeking education that imparts a comprehensive understanding of social impact and provides the networking opportunities, connections and practical experiences they’ll need to succeed.
The Master in Business for Social Impact & Sustainability from IENYC is the ideal program for anybody looking for a hands-on learning experience delivered by leading academics and practitioners in the field. Strategically located in New York City and including personalized coaching, workshops and networking events, the program is designed to prepare tomorrow’s leaders to use business for social impact. Check out the program here.