Social responsibility is an ethics theory that tries to balance the relationship between “good business” and “good for society” concepts.
Corporate Social Responsibility or CSR has been defined by Lord Holme and Richard Watts in The World Business Council for Sustainable Development’s 2000 publication ‘Making Good Business Sense’ as “…the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as the local community and society at large”.
Many companies are now measuring “the triple bottom line” to determine how socially responsible they are. According to a 2009 article in The Economist, “The phrase ‘the triple bottom line’ was first coined in 1994 by John Elkington, the founder of a British consultancy called SustainAbility. His argument was that companies should be preparing three different (and quite separate) bottom lines.
One is the traditional measure of corporate profit—the ‘bottom line’ of the profit and loss statement. The second is the bottom line of a company’s ‘people account’—a measure in some shape or form of how socially responsible an organization has been throughout its operations.
The third is the bottom line of the company’s ‘planet’ account—a measure of how environmentally responsible it has been. The triple bottom line (TBL) thus consists of three Ps: profit, people and planet. It aims to measure the financial, social and environmental performance of the corporation over a period of time. Only a company that produces a TBL is taking account of the full cost involved in doing business.”
Oregon businesses who embrace measuring social responsibility have the option to register as a benefit company. A benefit company is defined as “…companies that aim to make a positive impact on society and the environment in addition to earning a profit. Some 30 states and the District of Columbia have enacted similar legislation for business corporations only. Oregon’s law includes corporations and limited liability companies.”
Social responsibility has always been important but until recently was not measured by many businesses. Small business owners generally encourage social responsibility through the policies and procedures they incorporate in their business model. To determine if your company is being socially responsible look at how you treat people – employees, customers, suppliers and stakeholders; how you treat the environment – reduce, reuse, recycle; and how profitable your company is financially.
This article was taken from here.