During a week when people are talking about the recent accidents in Bangladesh, and what that means for companies sourcing from the developing world, I have been thinking about another subject that has great social impact potential, Corporate Social Responsibility (CSR). CSR in the US came of age in the 90s when companies like Nike and the Gap were called out for using supply chains that had questionable sources, including sweatshops. Companies began to focus more on improving the image of their social impact, and CSR was one way they have tried to do that.
CSR comes from well-meaning companies, but is often of limited impact on society. Sure, you can recruit star employees who care about working for a company with “heart,” and customers might view you more favorably if you can show a social concern. But unless you are a social enterprise that incorporates social impact into your business model, your CSR program is probably not making the most of your company’s potential impact.