Corporate social responsibility (CSR) in sustainable supply chains

Corporate social responsibility (CSR) has shifted how organisations conduct business and source products. Understanding the impact of CSR and using sustainable business practices can help businesses achieve their goals and drive positive change in the world. 

What is corporate social responsibility (CSR)? 

CSR is an organisation’s commitment to supporting people, communities, and the environment. Companies with CSR policies in place make themselves accountable to their shareholders and the public for the impact they have on the world. Consequently, CSR is also a strategic approach to doing business that can have a lasting positive impact on all stakeholders involved. 

How to measure CSR in your supply chain 

There are four different types of Corporate Social Responsibility: environmental, ethical, philanthropic and economic responsibility. A good way to start measuring your CSR is by looking at each type separately 

1. Environmental responsibility

One of the most frequently associated terms with sustainability. Environmental responsibility CSR includes taking steps to minimize waste and pollution while also working towards an environmentally friendly future for all. 

Your company can get started, firstly by setting standards to reduce the environmental impact of the extraction of raw materials. Secondly, tracking the impact on the environment using data points to gather information about air emissions and water waste helping you identify major risk areas. Lastly, implementing a holistic approach to sustainable solutions can also have cross-departmental benefits and maximise a positive impact on both the environment and people.

2. Ethical responsibility

An aspect of sustainability that is often overlooked. Ethical responsibility CSR is concerned with how an organisation operates treating workers fairly, sourcing products responsibly and treating all stakeholders with respect.

There are five areas organisations should prioritise to prevent social risk when looking at ethical responsibility. These include forced labour, child labour, discrimination, freedom of association and health, safety and hygiene.  

3. Philanthropic responsibility

This part of CSR is important when looking at an organisation’s vision and purpose. Companies with strong philanthropic CSR aim to contribute to society at large and make the world a better place.  In practice, organisations that have a philanthropic responsibility as a priority tend to support charitable initiatives or create their own.

To get started your organisation can start making contributions to charities that run projects in line with the company’s purpose. Alternatively, your company can encourage employees to volunteer or work in partnerships with smaller not-for-profit organisations to amplify their efforts.

4. Economic responsibility

A business must have the financial resources to support any other initiatives. Having the areas above at its core will then drive financial decisions that contribute to profitability, the environment, people and society.  An example of economic responsibility could be paying decent living wages to employers at company sites and in remote production sites. The financial success of the business then reflects on fair wages and responsible sourcing practices.  

Benefits of corporate social responsibility practices

Organisations that embrace CSR can reap several benefits which include: 

  • Raise brand awareness and improve reputation by attracting new investors and consumers 
  • Increase employee engagement by leading a purpose-driven organisation 
  • Create a competitive advantage by addressing potential risks ahead of time and building a resilient supply chain 
  • Drive positive impact for workers and communities 
  • Prevent financial risk by meeting legislation on workers’ rights across all business operations

How Sedex can help 

Sedex offers a variety of tools and expert advice that help organisations like yours get closer to their corporate social responsibility goals. Using technology and data, Sedex can help you build a more sustainable supply chain to drive positive change and business success.  

  • Sedex advance allows you to store, share and report on supply chain information and manage supplier performance on health and safety, due diligence and CSR goals. 
  • Use a Self-Assessment Questionnaire (SAQ) to gather data about activities and working conditions across your supplier sites. 
  • Our risk assessment tool helps you identify social and environmental risks across your supply chain and compare inherent risks in relevant countries and sectors. 
  • Our Consulting team can design a holistic supply chain management plan that focuses on your business priorities and delivers tangible change for you and your key stakeholders. 

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