CSR in business has been more vital than ever in today’s political and social climate. The world has undeniably been in a contentious state when it comes to policy issues regarding areas such as environmental protection, homelessness, diversity, and other social problems. While governments have generally been slow to mobilize on tangible solutions, corporations have been getting increasingly involved in taking action through corporate social responsibility (CSR.)
The concept of CSR has risen in popularity in recent times: As a society, we ask for businesses to no longer see profit-seeking as their only goal. We ask that they consider all stakeholders involved, not just the shareholders. Now, virtually every large company is expected to make some efforts in the area. However, one type of company has been notably lagging in the upward trend of CSR spending: Startups.
Of course, this is rather understandable and intuitive. The beginning years of a company are often flooded with creating a product, securing seed investments and investors, and just the overall craziness of kickstarting a business. Startup founders are certainly well aware that it may take several years before the company ever starts to see a profit. In the presence of such stresses, it hardly makes sense to consider giving back to the community and leading social change already. But could this be a missed opportunity?
A common flawed assumption is that CSR in business is always an expensive undertaking, and therefore, only large global companies should be expected to take it on. However, the reality is that there are multiple ways to successfully execute CSR business initiatives without sizable donations or foundation money. Depending on the product category your new company is serving, aligning with a higher purpose could ultimately attract more customers (and higher-quality customer relationships.)
If you’re a startup founder wondering how to take your company into the world of CSR, here are some tips to get you going.
- Match Your Company with a Cause
This is intuitive enough: choose a non-profit or initiative that connects to your industry on some level. For example, if you’re building an app for language learning, you might donate to a non-profit that strives for equitable education. This type of partnership is beneficial for both parties: The non-profit furthers their cause, and your startup can use it as a meaningful marketing strategy. When customers see who you partner with, they can grasp a deeper understanding of what your company’s values are.
It’s especially important to pick an issue that resonates with your customer base. If your company attracts environmentally-conscious customers, you’ll want to direct your CSR efforts towards parallel ideas such as tree planting or clean water initiatives. Continuing with the idea of stakeholders, you should also consider your startup’s employees. What are they passionate about? Find out, and give them opportunities to get involved in non-profits that they believe in.
This helps to alleviate the high turnover rate that is typical to see in startups, and it increases employee morale. Particularly amongst the millennial generation, working for a socially responsible company is starting to take a higher precedence over large salaries from neutral or unethical companies.
- Publicize CSR Efforts
Of course, CSR should be done for the right reasons: Your company wants to give back to the community and further social change. However, the fact is that scaling startups are on fragile financial ground. The bottom line needs to be met so that the company can survive, or there can be no CSR efforts at all. Therefore, when choosing to engage in CSR, startups should make it their priority and tell the public about it.
As discussed earlier, millennials are increasingly gravitating towards companies that are transparent and open about their CSR. Now that social responsibility is seen as a “given” amongst companies, it can be used as a primary way to attract customers.
Going public is simple -- Your company simply needs to be genuinely invested in its chosen cause, and the rest will follow from there. There are multiple channels that you can use to update consumers on your projects, such as social media, community forums, and newsletters. The key is to remain as transparent as possible and allow people to view your company’s progress. Setting goals and targets is another strategy that allows your company to have quantifiability, which is highly valuable.
When your startup has begun to achieve notable social impact, you can celebrate it through pitches and press releases. Often, this is the differentiating factor amongst similar companies -- People are usually more attracted to stories of positive community impact as opposed to new product launches.
- Dive in and Commit
When you’re leading a startup that’s trying to establish itself in the industry, commanding a meaningful CSR presence seems like a tall order. However, it’s important to remember that any and all outside connections and partnerships often make up the most valuable foundation for a company.
CSR can help you to secure that first “big investment.” Similarly to employees and consumers, investors (such as VCs, angel investors, and philanthropists) are increasingly considering corporate citizenship as a factor to consider. Startups that “give back” are generally more memorable and intrinsically pleasing to investors that may be considering multiple candidates at a time.
Again, money is not necessarily required to give back to your community! Arranging events such as employee volunteer days or workshops that align with your chosen cause can be far more valuable than just large financial donations.
Consider all of the benefits that CSR has to offer -- besides enriching company culture and attracting customers and investments, the fact is that community involvement is never a bad thing. Rather than waiting for your company to grow and start realizing profits, start thinking about your CSR path now.
With MassLight, you can focus on enriching your company’s social purpose while we handle the role of technical founder. In our build-for-equity program, we deliver sophisticated software tailored to your startup’s unique needs -- a solid technical foundation enables you to pursue your social impact goals. Contact us today to learn more, or to pitch us your startup concept!