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How Being a Socially Responsible and Ethical Company Has its Benefits

Updated on October 20, 2015
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As a business owner, you have probably considered the role that social responsibility and ethics plays in your business venture. Hopefully, your pondering helped you realize that running a successful business means more than just big profits. With a properly structured socially responsible business, you truly can change an important facet of the world. Whether you want to tackle a major social issue or just improve your own environmental practices, running a socially responsible and ethical company has distinct benefits -- and some of them even show up in the bottom line.

More and more businesses are choosing to run an intentionally ethical business. Others aren't sure if they can because they only have a few employees and little revenue. The truth is, anyone can do some small part for social responsibility and do the right thing. What are the benefits to “doing the right thing”? Let's take a look at some of the most obvious ones.

Social responsibility in society

The main benefit to becoming a socially responsible company is that you are actually making a positive difference in the world. Just imagine if every company attempted to make ethical decision and be more socially responsible. This would result in a much better world. Even if you are only making a small difference, your efforts combined with the efforts of other ethical companies can help make big changes.

Differentiating business through social consciousness

Becoming a socially responsible business can help to distinguish your company from the competition. How you choose to practice social responsibility is up to you. There are many different ways to do so. You can partner with a nonprofit, offer benefits to your employees, go “green”, or simply be more conscientious in your decision-making process. Being more ethical will likely improve your customer service and possibly your relationships within the industry. These factors will help to ensure long-term success as well as earning you a reputation for ethical business practices.

Gaining credibility through responsible acts

Another benefit to becoming a socially responsible business is that your customers will recognize your company as trustworthy and morally responsible. This trust can be incredibly important when you are trying to build long-term relationships with your customers. Customers who see that a business is attempting to limit its impact on the environment or lend a hand to the needy will be more inclined to remain loyal customers of such a company. These customers will probably pass along their passion and loyalty to friends and family. Word of mouth can be a powerful advertising tool for you. This will help you build a solid customer base that will remain faithful for years to come.

Creating a loyal, happy labor base using good ethics

One way you can create an ethical company is to treat your employees with kindness and respect. This means that you should look after their welfare and do whatever you can to ensure their health and happiness. If your employees are happy with your company, they will be more efficient workers and be more likely to stay with your company. You can offer healthcare, on site gyms, or other support services. Quality employees are hard to find, so you will want to maintain your workforce if possible. Great employees will translate into happy customers and bigger profits.

Help inspire other businesses to greater levels of social responsibility

As a socially responsible business, you set a good example for other business who may be considering becoming more ethical. Over time, perhaps immoral business practices will be eliminated altogether. Your socially responsible business practices may cause other businesses to be pressured to be more ethical. Companies like TOMS shoes, Google, Starbucks and Intel are helping to pave the way for other socially responsible businesses.Less known -- but no less important -- businesses such as Better World Books form their entire business plan around social responsibility.

As you start to change your business practices and become more ethical, you will see that your hard work is all worth it. Nothing can compare to the feeling of knowing you are doing the right thing, and if the right thing helps your business improve profits, then it’s all the better.

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    • wheelinallover profile image

      Dennis Thorgesen 

      7 years ago from Beatrice, Nebraska U.S.

      I know how you feel. I am the same way. This house has been a place to call home for people who needed it and I hope that continues for as long as I live.

      Although I have lived alone sometimes for years at a time because of accessibility problems I find it is not really comfortable for me. That coupled with the fact that there really are people out there in need I am glad my home is now a safe haven for them. Good luck with your dream I hope it doesn't take long to fulfill.

    • wychic profile imageAUTHOR

      Rebecca Mikulin 

      7 years ago from Sheridan, Wyoming

      Yes, we definitely know that financial provisions aren't sufficient in and of themselves. We have a normal food budget for four people (two adults, two young children) and THAT doubles when my 17-year-old stepson comes to visit ;). Hopefully by the time we're in a position to do it I will have a lot more in recurring income, and the acreage we hope to move to will provide some food and income as well. For me, just knowing that someone needs a loving, supportive home is enough for me -- I want to be that home!

    • wheelinallover profile image

      Dennis Thorgesen 

      7 years ago from Beatrice, Nebraska U.S.

      I look forward to reading your hub when it's finished. I have been following your for a while which is how I found this hub.

      Foster care can be rewarding but don't expect that you will get enough money to meet all of a teenagers needs. It's costing a friend of mine double her normal food budget to have her teenage grandson for the summer. Her normal food budget feeds two.

    • wychic profile imageAUTHOR

      Rebecca Mikulin 

      7 years ago from Sheridan, Wyoming

      Hmmm...I'll see what I can do about drilling down to more specifics in a hub -- or series of hubs -- my brain is already sifting through the possibilities ;). Luckily the keywords are the part I can really do, I'm a marketing person :D.

      That would be so awesome to be able to offer space in the house to those who need it. Having been in an abusive situation myself, I know what a profound impact just one person can make when they show they care. There is a woman here to whom I will be eternally indebted, because without her I would not have had a roof -- and at one time, she had up to six teenagers living with her in her one-bedroom house (3/4 of a trailer house) while we sought more permanent accommodations.

      My husband and I have discussed the possibility of being approved for foster care once we get into a permanent house (current rental won't allow more than four people); he went into the system as a pre-teen, and went through a lot of bad homes before he was adopted. We have the kind of background and resources that could be really beneficial to older kids in foster care, but I'm afraid we still have a long way to go to make it a reality. For now, I'll just have to be satisfied with being able to offer a couch and a roof to anyone with an immediate need :).

      You're right, there is so much more to life than money -- money is what allows you to get the results in life, it isn't the desired result in and of itself.

    • wheelinallover profile image

      Dennis Thorgesen 

      7 years ago from Beatrice, Nebraska U.S.

      You really should consider writing a hub including the information you have in your comments. I don't know how you would keyword it to reach the right audience. Everyone of your ideas would work worldwide and people need to know even your simplest idea would work.

      We changed every light bulb in the house other than the tube lighting in the kitchen and garage to energy savers.

      In case you didn't know our house is kind of a business also. We take in people who come out of abusive marriages or other abusive situations. We have had 12 people living here at once. I can't tell you how many times I have heard "we need more room".

      So far it's been mothers with children so some of the population don't take up as much room. We are not paid by anyone for taking these people in. It is all done by word of mouth. We can't handle more than 12.

      We guide them towards the help they need to recover and work with the children on a daily basis. I can't tell you how good it feels to see a woman realize she has worth or a child finally come out of the shell they have built up around themselves.

      These people are the reason we are not in profit, but I wouldn't change things. Some things are more important than money.

    • wychic profile imageAUTHOR

      Rebecca Mikulin 

      7 years ago from Sheridan, Wyoming

      Awesome! I'd love to be able to help start-ups, but even in the limited consultation capacity I have with existing businesses here (part-time -- it's a town of 15,000 people, and sadly most of the business owners don't realize they need to change their plan until it's too late) I have been able to thoroughly convince even the most internal-centered owners about the value of certain changes. Heck, even something like changing to light bulbs that use less energy or putting better insulation in their building is indirectly socially responsible, and it's not hard to convince them of value if they like their bottom line too.

      I think adding social responsibility into the business plan is such a great way to go about it; it's a differentiating factor for the business, could pave the way for start-up grants, great PR, you name it :D.

      One of my early inspirations for thinking more along socially-responsible lines was in high school -- our local FFA chapter collected donations from local businesses, then used that money to buy pine saplings in the local species to replant areas that had been damaged by construction or mudslides. Not only was it great for the environment and for the kids doing it, but one of the biggest contributors was an outdoor sports store, so it was great for them too because the community was able to see that they were actively participating in the health of our mountains.

    • wheelinallover profile image

      Dennis Thorgesen 

      7 years ago from Beatrice, Nebraska U.S.

      Thank you for your response this will fit well with part of our business. That would be the part I deal with. LOL

      I am working with people currently who are starting up off line businesses including helping them put together their business plans, if I can get them to accept social responsibility into their business plan that would be a great start. I think I will add it to the templates we use now.

    • wychic profile imageAUTHOR

      Rebecca Mikulin 

      7 years ago from Sheridan, Wyoming

      Agreed, it certainly can go too far :). I've actually had people who have asked how they can be socially responsible when they don't want to be a non-profit. Speaking to local business owners (in Wyoming, very conservative in many aspects and not terribly environmentally-conscious on the whole), most of them thought they could not do anything socially responsible. We've discussed everything from encouraging employees to sort their trash into designated bins for recycling, to offering discounts if customers ride their bicycles and bring their helmets in.

      What many businesses have reported back is that once they've implemented one small socially responsible change, they tend to be more motivated to try another. Employees often start offering their own ideas for further responsibility.

      A local pediatrician implemented one idea I offered, which helps her patients and the environment at the same time -- she refers her patients to the local volunteer-run food co-op for low-priced, organic produce that is delivered in bulk once a week and sourced as close to home as possible. While this may seem like a small thing, the co-op now delivers about 300 baskets of produce (and many add-on cases of produce and whole grain, honey-based bread) to this small community every week. It has significantly changed the way a huge percentage of the town eats.

      These small things are very encouraging, and make me wonder what would happen if each and every business implemented even one small socially responsible change per year. Thanks for stopping by :).

    • wheelinallover profile image

      Dennis Thorgesen 

      7 years ago from Beatrice, Nebraska U.S.

      wychic Socially responsible business can at times be taken too far. My corporation is basically being run as a non profit because too much of the income is going to help people in need.

      The way I look at it is for every person who no longer has to live in fear or goes to bed with a full stomach instead of an empty one I have profited. Thank goodness my staff feel the same way. You are right even a little social responsibility from every company would make a big change in the world overall.

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