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Surprise: Small Businesses are not just small corporations

Modern Small Businesses are not miniature versions of big business or large corporate organisations. And using the 'C word' in small business never gets you very far in the right direction.

Trying to apply the dysfunctional processes and slow responding mindsets of corporates to a Modern Small Business doesn’t work.

So how relevant is Corporate Social Responsibility (CSR) to Small Businesses?

In this article

We don’t use the ‘C word' here

Small Business is traditionally closer to the community than big business, enjoying better relationships and stronger connections with their customers. Already acutely aware of the impact their work has on the lives of its staff and customers, CSR programs have little meaning for a Small Business.

For Small Business perhaps the phrase Business Social Responsibility (BSR) is more relevant.

So when did corporates get responsible?

Well, the jury is still out on the subject, but the CSR programs grew out of the discussions in the 1950’s lead by Howard Bowen about how a business can continue its purpose of creating wealth while being in harmony with society and the environment. The argument is, that running a business generally brings both benefits and costs to the community and the environment.

Costs might include the impact upon the environment and the community such as indiscriminate pollution, deforestation, and using sweatshop labour in developing countries to produce goods in less than safe work environments.

CSR programs help offset some of the indirect costs suffered by the community and its environment and compensate for some of the negative aspects of bigger businesses in the world.

Small business and BSR

Small Business understands that successful personal relationships are a key marker of success and they usually enjoy better relationships with their stakeholders and the local community than big business. Their staff are usually known personally by the business owners and while it’s not uncommon for corporates to refer to their staff as ‘family’, it’s arguably more authentic when used in the Small Business context.

The result can often be Small Business employees are treated better than those in large companies and enjoy higher flexibility in their work arrangements.

You don’t have to be a saint to do something good.

So where does your Small Business stand on giving back meaningfully to the community?

First, ask yourself and then query customers.

Perhaps it starts with fair trade coffee

The Fair Trade movement and the rise of Fair Trade certified coffee as a distinguishable premium product identifier provides useful insights into the conscious consumer.

The success of the Fair Trade community and their ability to certify a supply chain from grower to consumer and deliver a premium brand experience is driven by the support of the conscious consumer movement. These are the self-identified individuals who are looking to save the world one purchase at a time, and who want to see their family have a positive impact on the world too.

These are the same consumers who are directing their superannuation funds to invest in socially responsible investments (SRI’s). This represents $629.5AU billion dollars in the Australian market and $6.57US trillion dollars in the American investment market.

Winning the hearts and minds (and wallets) of the consumer

While BSR may not interest some Small Businesses, the millennial generation workforce of talented socially concerned workers is interested.

Maybe you’re looking to harness the growing groundswell of the conscious consumer. Perhaps you’re needing to attract and retain top talent. Either way, the business of doing good business is now becoming a key marker of choice in the hearts and minds of the informed, connected consumer.

The opportunity is in the 65%

Ongoing customer research states today’s consumers can be divided into three mains groups

  • 10% are passionate, green and will go out of their way to find suitable purchases to support their belief, passion, and expression
  • 25% are totally uninterested, but
  • 65% are willing to care if they find easy ways to do that

When it comes to attracting and retaining talented workers, the 2015 Nielson Global CSR report highlighted consumers expectations:

  • 67% prefer to work for a socially responsible company
  • 52% check the product packaging to ensure sustainable impact
  • 52% made at least one purchase last month from a socially responsible company
  • 49% volunteer and or donate to organisations engaged in social and environmental programs

Even if sustainability isn’t part of your Small Business origin story, you can benefit from environmentally friendly and socially conscious practices. Whether you believe businesses have a responsibility to give back to the community from where you draw your customers or not, your customer’s mindset may force you to rethink your position.

Remember, you don't have to be a saint to do something good.

The last word

Using your business for good, whether it’s motivated by enlightened self-interest or the wish to harness the groundswell of conscious consumers and attract and retain talented purpose seeking staff – regardless of your motivation, doing good with your business is still good business.

Drew Browne Modern Small Business thought-provocateur
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