Social responsibility has been a major topic of discussion amongst corporate communities and leaders for the past decade or so, at least. Social responsibility is a new-age thought process toward the operations of a for-profit business. In traditional operations, the most important aspect of any organization is the bottom line.
The bottom line refers to, of course, the profits and revenues that the company is bringing in. However, constantly prioritizing the amount of money the company makes quickly created a culture in which nothing but the bottom line mattered.
These operational philosophies quickly became scrutinized and lost popularity with the majority of stakeholders who weren’t necessarily seeing any benefits from the profits being made. In turn, it became more and more common to add in other priorities besides the profit-line.
For instance, the environmental crisis affects virtually the entire world, and many organizations have started to take this into account when evaluating their operations. Tracking their environmental impact, finding ways to reduce that within operations themselves, but then also going above and beyond that and championing environmental causes and initiatives outside of their own organization.
Other societal priorities became important, too, and quickly the bottom line was overshadowed by the triple bottom line which accounts for profits, environmental sustainability, and social responsibility.
“The obvious reason to apply the triple bottom line is to have a greater positive impact on the world. Instead of focusing on paper profit, companies can quantifiably determine how the business is favorably changing the world and the people it engages with.”
– Will Kenton, VP of Content, Investopedia –
1. Setting up Foundations
One of the most popular ways that a CEO can work on giving back to the community is through the setting up and operating of a foundation. Foundations are not-for-profit organizations that often aim to do good in the world in some capacity or another. There are a variety of reasons that setting up a foundation is a good way for CEOs to give back.
First and foremost, it allows fundraising at a larger scale which can do more good for the cause or initiative than a single person’s donations. Not only that, but there are also a variety of tax-benefits that the overarching organization can make use of which makes the setting up of a foundation an excellent strategy on the business side of things as well.
The benefits of setting up a foundation extend even further than that, as it can also help build a more positive brand reputation amongst consumers. This can potentially attract even more customers to your brand who share similar values to the initiative of the foundation.
“Setting up a foundation is a great call for a CEO who wants to contribute to society. The most effective foundations are those that are created with vision, intent, and passion. So it helps if there’s a cause that already speaks to you.”
– Nabiha Akhtar, CEO and Founder, Lil Deenies –
Setting up a foundation, though, does have some drawbacks. It can be time-consuming and there is a lot of planning that needs to happen before the foundation can be officially opened. If you’re not ready to fund a not-for-profit foundation, don’t worry; there are still other ways you can contribute to the community around you as a CEO.
“There are a bunch of small business owners and entrepreneurs who want to do their part and contribute to the community around them. They might not have the means to open a full foundation, but they can still help in plenty of other ways.”
– Lionel Mora, CEO, Neoplants –
2. Personal Charitable Donations
One of the easiest ways that a CEO can contribute to the community and the causes that speak to them the most is through personal charitable donations. This is a great way for CEOs to continually give to organizations that are actively working to better our world. With the giving power that is attached to CEOs, these organizations can accelerate their efforts, and do even more good for a greater number of people.
“We love to see local CEOs at our charity events and on our list of donors. It just makes you feel like the people who are building these work-force communities also care about the community in which the workforce lives.”
– Juan Pablo Cappello, Co-Founder and CEO, Nue Life –
Personal charitable donations can also come with tax-write-offs which is another incentive for CEOs to make sizable contributions on a regular basis. However, one of the other reasons that personal charitable giving is a good strategy for CEOs is because it offers them the ability to spread out their donations and give to more than a single cause. Once again, this can help build their own personal reputation as a philanthropist, which can help win over the clout of both existing and new consumers.
“Philanthropic CEOs typically gain more recognition and buzz worthy news than their non-philanthropic counterparts. A wise CEO can use this positive publicity to their advantage and turn it into a value-add. But at the end of the day, it really should be about doing good.”
– Ryan Delk, CEO, Primer –
3. Empowering the Community
A lot of philanthropic activity is seen from an individualized stand point. However, there is so much power in numbers. The more people involved in a cause, the more likely it will get funding, attention, and realistic momentum forward. Understanding this, CEOs can make use of their network in the community in order to bolster giving efforts.
“Sometimes as a CEO it’s not just about giving, it’s also about encouraging, promoting, and championing that cause. Because people innately look up to you when you’re in that position, so you have the option to use that influence for the greater good if you so choose.”
– John Sarson, CEO, American Crypto Academy –
Knowing that you can influence a number of others to get involved and help with the same cause is extremely valuable and can really be a game-changer for the organizations that you choose to direct your support and the support of your network as well.
“We’ll never forget when a local CEO simply started promoting one of our events. We didn’t even ask them to, they just started doing it on their own. Suddenly donations were flying in like crazy. It brought us all to tears, honestly.”
– Sumeer Kaur, CEO, Lashkaraa–
4. Dedication to a Cause
When it comes down to picking the giving strategies and how exactly you’re going to pursue philanthropic efforts as a CEO, it’s really important to pick a cause. This way, you don’t have to feel unsure about where to donate, or how you want to direct your philanthropic energy.
You could choose forest preservation, for example, and focus all your giving efforts on the preservation of natural land. Or, on the other hand, you could focus on the preservation of certain sea life that is crucial to the overarching ecosystem of which we’re all a part.
“Having a cause in your mind’s eye can be really beneficial. It just helps you direct your efforts toward a single goal instead of worrying about trying to do it all yourself. This way, your efforts will be pointed, and could actually contribute to real solutions.”
– Ryan Rottman, Co-Founder and CEO, OSDB –
There are a ton of different charities and not-for-profit organizations that are more than well worthwhile supporting. From humanitarian organizations to environmental conservation organizations, and everything in between. If you’re in a position to donate regularly, pick a cause and start getting to work.
“If you have the means, there’s no reason not to make a donation. I mean, the system is even set up to incentivize people to make a donation. There are so many organizations out there doing so much good and many of them could benefit from your contribution, no matter how large or small.”
– Chris Bridges, CEO, VITAL –
5. The Patagonia Story
The Patagonia story is a favorite for many. Patagonia was founded by a mountain climber whose only mission at the time was to save the face of the mountains he was climbing. As such, he created his own gear and began selling it on the side of the trail. This continually grew until it became the outdoor retailer that we’re all familiar with.
“It’s really amazing, when you think about it, some of the best business people of our generation didn’t even set out to be a business person. They started with a cause-based-mission and things just expanded from there.”
– Kirin Sinha, CEO, Illumix –
After spending decades to the top of the outdoor retailer space, the Patagonia owner decided it was time to move on, and began working on a succession plan. What people didn’t know at the time is that this would be one of the most unique and amazing succession plans that would come about in history.
The Patagonia owner literally made history by selling the entire company, and all of its future profits to a trust and a not-for-profit organization that is intended to maintain the integrity of Patagonias original goal; the preservation of the planet.
“I was in shock when I heard the news about Patagonia. It was such an amazing way for him to secure the future of his company in his own vision. He didn’t want the planet to get overshadowed by profits.”
– John Berry, CEO and Managing Partner, Berry Law –
Final Thoughts on CEO Social Responsibility
As a CEO you have a position of influence and power in your community. It’s only right to use this for the greater good, and to choose a variety of philanthropic avenues through which you can contribute to the community, the environment, and the betterment of the world as a whole.
“Large businesses aren’t the only ones benefiting from creating a corporate social responsibility platform. Many small and mid-sized companies have found creative ways to adopt a socially responsible approach to positively impact others in ways that go beyond jobs or service creation.”
– Olivia Cooper, Author, GreenApple –
