What Is CSR? Understanding Corporate Social Responsibility

These days, many consumers are willing to pay more for products from a business that runs projects supporting worthwhile social causes. Businesses see this as a strategy that targets consumers' buying psychology, and Corporate Social Responsibility is the term used for these activities. So what is CSR and what role does it play in business operations? Let's Mona Media find out in this article!

What is CSR?

Corporate Social Responsibility, or CSR, can be understood as a company's social responsibility. It is a term used in business and in law for companies that commit to operating while keeping to professional ethics and acting in good conscience. Put another way, when a business practices CSR, besides earning profit it must also make sure its operations do not harm the core values of society. It also pays attention to protecting the environment and serving society and the community.

Why do businesses need to practice CSR?

Strengthen your competitive edge

In business, building a good image in customers' eyes is extremely important. By taking part in social responsibility, you build the image of an upright business, which goes a long way toward winning customers. Once customers welcome and support you, your standing in the market will be stronger and more secure against competitors. That lets your company grow and earn more profit. See more: How to identify your business’s competitive advantage

Attract investment capital

Once a business has a reputation, investors naturally come to propose partnerships and investment. Everyone wants a long-term partnership with a business that has both heart and vision.

Minimize legal incidents

Social responsibility is also tied to business law and social norms. If you follow the state's CSR regulations fully and seriously, your business does not have to worry about legal trouble.

Types of CSR that businesses need to carry out

Environmental protection activities

The first responsibility that businesses of every size must care about and work on is protecting the environment. The living environment decides whether society can survive and develop. No matter how successful a business is, if it takes no steps to protect the environment, it will first be boycotted by local people. Depending on how much harm it causes, it can also be penalized under the law. The first responsibility businesses must care about and work on is protecting the environment. Depending on the nature of your business, you can plan environmental activities that are suitable and practical. A large business, or one whose workers are closely tied to the environment, can launch tree-planting and seedling campaigns. A small or medium business can start a movement to save electricity, water and paper right in the office, or encourage each employee to keep a green plant on their desk.

Charity activities

Depending on the business's circumstances, you can run suitable charity activities. For example, you can raise funds and donate cash to organizations that care for children or elderly people living alone. Another common approach is to ask employees to donate old clothes, belongings or household items, to be passed on through an intermediary or sent directly to remote areas.

Community activities

Today, many organizations hold events such as marathons and cycling races to raise funds or spread useful information to society. A business can take part in two ways: sponsor the event or send members to join. The community rates this highly, because it promotes the brand and also motivates employees to take part in activities that keep them healthy.

Activities for employees

The core of a business is its people. If the working environment and the way it is managed and run bring real benefits to employees, they are more likely to stay and give their best to the company. To do that, a business must keep working hours, overtime and extra pay in line with regulations. It should have a clear, transparent pay and bonus policy and, if it can, add other welfare programs such as scholarships for employees' children or gym and yoga memberships.

Apply social responsibility standards

Although more businesses are paying attention to CSR activities, most of them are done ad hoc and in isolation, so it takes a lot of time from the idea to the execution. They also struggle to carry good messages beyond the business in a short time. That is why businesses can adopt social responsibility standards. Each set of standards helps a business see what it needs to do, how to do it and for whom, so it can put together strategies that fit its conditions and character.

How to build and market CSR for high performance

Share meaningful knowledge, skills and messages

To truly connect your business with society, use the useful knowledge of your own field to share with consumers. For example, nutrition companies can show how to read information on labels or how to choose products suited to different people. Healthcare businesses can share health care guides and exercises. This is also a useful way to deliver meaningful messages to customers and build stronger trust in the business.

Ensure good policies and benefits for employees

As mentioned above, people are always the core of a business. When you actively develop policies to take care of your employees, you build solidarity and a good company culture, and you also win society's goodwill toward the business.

Prepare a sustainability report (CSR Report)

A sustainability report (CSR Report) should be taken seriously and published every year, like a company's economic and financial reports. Large corporations around the world treat CSR as part of their success. Their reports are widely read and followed by society, which spreads their influence and pushes forward creative business thinking that contributes to the community and society.

Some examples of CSR in Vietnam

Honda and the “I love Vietnam” campaign

One typical CSR example in Vietnam is the “I Love Vietnam” campaign that Honda has run very effectively since 2003. The campaign aims at safe driving. Honda has made a series of videos broadcast on television and received a lot of positive feedback. In 2021, Honda also developed a second season of its traffic-safety program for children aged 3 to 5.

Vinamilk and the “Vươn cao Việt Nam” fund

The well-known dairy company Vinamilk has also made significant CSR contributions. First is the “Vươn cao Việt Nam” milk fund, founded in 2018. It is a community program with a clear and meaningful focus on children. Vinamilk has delivered more than 37 million glasses of milk to more than 460,000 children across Vietnam, from Ha Giang to Ca Mau. The company has also launched other campaigns, such as “One Million Green Trees” and “A million glasses of milk with love, a million happy smiles” at the end of 2020, along with many smaller events and programs.

Grab and the “Sài Gòn ơi, đừng bỏ bữa” campaign

At the end of July 2021, as the Covid pandemic surged and hit Ho Chi Minh City hard, Grab worked with the Bông Sen charity fund on a program called “Sài Gòn ơi, đừng bỏ bữa” (Saigon, don't skip your meals). The program gave free meals to people in difficult circumstances and low-income workers in locked-down areas. In its first phase, Grab handed out 11,500 free meals, easing the burden for many people. That is some basic information about what is CSR. We hope this article helps you understand the term better and encourages businesses to take their social responsibility seriously.