Corporate Social Responsibility: How the Private Sector Can Lead Social Change
Sustainable Directions would like to thank Elyse H. Lee for her contributions and insights into the dynamism of Corporate Social Responsibility. Elyse is a powerhouse for social good. Prior to her current role in corporate responsibility and global impact for FleishmanHillard, Elyse advocated for at-risk youth and human rights through tireless nonprofit work, political campaigns, legislative affairs, and as a Court Appointed Special Advocate. Elyse believes the private sector holds the power to push social agendas towards actual impact. And I completely agree. Check out her post below, and videos I've selected to highlight leaders in private sector engagement.
Post contributed by Elyse H. Lee. These days, when you mention Wall Street and 1-percenters, most people think greed, corruption, and the exploitation of hard working individuals. This is certainly the case as the subprime mortgage crisis in 2008 and the more recent Wells Fargo scandal indicate. To add fuel to the fire — while recent studies indicate that the income inequality gap is slowly closing, income gains for the wealthiest 1% are soaring at much higher rates than for middle class and low-income families.
It is undeniable that the private sector and corporate executives consist of most of the economy’s wealth, and with that — immense influence. Many associate that influence with crookedness. Yet that same capacity can be also channeled to foster broad, sweeping social change.
I knew I always wanted to pursue a career in “social impact,” and like most others, I initially associated this space with non-profits, philanthropic foundations, governments, and law. I have since recognized that the private sector deserves more recognition (and requires more accountability) in how they serve as a critical agent for social good.
In my work, we counsel corporations, venture capital firms, and social enterprises that utilize private sector approaches to solve some of the most pressing social issues of our time. This practice, formally described as Corporate Social Responsibility (CSR), allows corporations to account for value beyond “the bottom line,” and to enact responsible business practices and ultimately give back to the community.
These initiatives can range from Patagonia’s pact to ensure safe working conditions and fair living wages for factory workers, Levi Strauss & Co.’s initiative to establish global water standards for more sustainable clothing production, Omidyar Network’s mission to only invest in socially driven companies, Microsoft’s prerogative to comply with all United Nation’s international human rights standards in their work, and Airbnb’s pledge to provide subsidized housing for relief workers and match up to $1million in donations to Syrian refugees.
Whether it’s through charitable grants, impact investments, leadership, or company resources, many corporations are taking the lead to focus on the double bottom line: profits and social impact. Every day, I see the immense capacity the private sector has to take action in ways other sectors can’t match in scale or efficiency. And to my pleasant surprise, I’ve met some of the most compassionate, brilliant, and talented individuals in the private sector, particularly in San Francisco and Silicon Valley.
When I began navigating career options, I dabbled in each of the areas traditionally associated with social impact: I worked at a nonprofit startup that served at-risk youth, engaged in numerous political campaigns, interned in legislative affairs at a Congresswoman’s office in D.C., worked in a law office that defended death row inmates who couldn’t afford legal counsel, and was appointed as a Court Appointed Special Advocate to represent abused and neglected children in the foster system.
While I found each of these opportunities rewarding in their own unique ways, I didn’t feel I was making the broadest impact I could at the pace I felt satisfied with. Additionally, in the nonprofit and public sector world, I found that most of the work revolved around fundraising and grant-making, which left less time and focus for driving actual impact. On the other hand, corporations already have the resources and influence to operate more nimbly than their public sector counterparts.
I don’t think the private sector should nor have the capacity to replace traditional impact sectors. In fact, I’m a firm believer that the most effective societal solutions are formed through cross-sector partnerships and collaboration of both the private and public sectors. Yet, the private sector deserves more attention as a tool for social impact. The United Nations Global Impact is one example of how companies and governments are working together to foster a more sustainable and inclusive global community.
Some may think these initiatives are too good to be true and ask, “What’s in it for corporations to compel them to devote resources toward these initiatives?” While I do believe many executives truly do care about being mission driven, CSR is also a smart business decision as well. Not only does enacting CSR initiatives improve the reputation of these organizations and provide ample marketing and public relations content, studies have indicated that CSR initiatives can also increase profits for these organizations and for our society. In fact, one of our clients, REDF, a venture philanthropy that invests in social enterprises who provide jobs for the “hardest to employ,” found that every every $1 social enterprises spend, it returns $2.23 in benefits to society. Win-win.
Why does CSR matter for you? For starters, I encourage my peers interested in social impact to take a deeper look in the private sector. For consumers, I encourage more people to take the time to learn which corporations are practicing responsible and ethical business methods and actively choose to buy goods and services from these sustainable businesses. For advocates, I encourage more people to encourage the private sector to adopt CSR initiatives as the norm. It’s no longer enough for companies to hold “do no harm” as their standard. Instead, the market should be proactively working to exceed doing no harm, and use their influence to actively leave our world a better place.
Views are my own.