Dan’s Blog — January 24th

We hear about ‘Corporate Citizenship’ but what does it mean?  A simple definition is: A Company’s sense of responsibility towards community and environment.

Investopia states: “Corporate citizenship involves the social responsibility of businesses and the extent to which they meet legal, ethical and economic responsibilities, as established by shareholders. The goal is to produce higher standards of living and quality of life for the communities that surround them and still maintain profitability for stakeholders. The demand for socially responsible corporations continues to grow, encouraging investors, consumers and employees to use their individual power to negatively affect companies that do not share their values.”

Corporate Citizenship develops through five stages, elementary, engaged, innovative, integrated, and transforming.

Elementary:

Activities are basic and undefined – due mostly to lack of senior management being uninvolved.  Small businesses (SMB) linger here, able to comply with the basics, such as standard health, safety and environmental laws.  SMB’s lack the resources and time to develop greater community involvement.

Engaged:

Companies begin to promote employees and managers in community activities that go above the compliance to basic laws.  Senior management begins to develop policies for corporate standards for corporate citizenship.

Innovative:

Corporate citizenship polices are more robust as well corporate strategies and approaches are funded and active support from upper-level management is more fully engaged.  Corporate transparency develops at this stage as companies begin monitoring their involvement.

Integrated:

Citizenship activities are blended into the companies regular operations.  Activities are monitored and measured against goals and strategies.  Some companies set up formal training for community involvement for their employees and management teams.

Transformation:

As with all things business, this is the stage where corporate citizenship fuels sales growth and expansion into new markets.  Economic and social involvement, support and integration are a regular part of a company’s daily operations.

This sales growth is not a bad thing!  Sales growth dovetails into business growth which puts dollars into the economy.  As businesses grow, so too, does their ability to engage the community and become a respected corporate citizen.

There are many benefits to corporate citizenship, such benefits are:

  • Excellent employee relations by increasing company morale, participation, productivity and retention.  Companies are realizing that their employees ARE the community and employees look to their company to act as ambassadors throughout their city and/or town.  Corporate citizenship flows through its employees to local community charities such as Habit for Humanity, local food pantries and local training and workshops for high schools.
  • Improved customer relations by treating their customers ethically and listening to their wants needs and feedback.  Again, community encompasses a customers as well as employees.
  • Enhanced marketing occurs because customers are more receptive to ethical companies and their products.

There was a mantra a few years ago that I saw on bumper stickers and it makes one stop and ponder:
Think Globally, Act Locally.    –Great advice for both individuals and companies.

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