Monumental challenges, such as climate change, social injustice, and poverty, are inspiring people worldwide to take action and find ways to better their communities and society at large. As efforts to solve these issues have grown over time, so has the role businesses play in driving social change.
According to Harvard Business School Professor Rebecca Henderson, who teaches the online course Sustainable Business Strategy, companies are starting to realize the importance of thinking long-term and considering the social impact of their products and services.
“This realization is arriving not a moment too soon,” Henderson writes in the Harvard Business Review. “The world badly needs a more sustainable form of capitalism if we’re going to build a more inclusive, prosperous society and avoid catastrophic climate change.”
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DOWNLOAD NOWWhat Does Social Impact Mean?
Before setting out to drive change, it’s important to understand what the term “social impact” means. Positive social impact refers to how businesses and individuals take action to address issues facing their communities.
To bring about social change, business leaders must identify the core values that motivate them to act. Those values are often focused on issues such as climate change, poverty, and other pressing social and environmental challenges impacting society. With values informing their decision-making and strategy, purpose-driven leaders can feel empowered to make a difference.
Working toward positive social change can mutually benefit businesses and the communities they operate within. Consulting firm Deloitte outlined six drivers of business value that directly relate to social impact: brand differentiation, talent attraction and retention, innovation, operational efficiency, risk mitigation, and capital access and market valuation.
For business leaders seeking to make a difference, now is the time to act. Here are four accessible ways companies can be more purpose-driven and positively impact society.
Related: How Can Purpose Impact Business Performance?
Business Strategies for Social Change
1. Engage In and Promote Ethical Business Practices
To effect change externally, companies must first look internally and ensure that a commitment to social responsibility is embedded in their business operations.
In the online course Business and Climate Change, craft beer leader New Belgium Brewing shares how it integrated ethical and environmental considerations into its business model.
"We did our first climate assessment in the late '90s and determined that, within our operations, our number one source of greenhouse gas emissions was our coal-powered electricity,” says New Belgium Brewing’s Chief Environmental, Social, and Governance Officer Katie Wallace in Business and Climate Change.
In an effort to introduce renewable energy, New Belgium’s employees voted unanimously to give up their profit sharing that year to bring wind power to their community and create the first wind-powered brewery.
New Belgium's focus on sustainability is also evident through its engagement in policy advocacy. For example, it co-founded the Glass Recycling Coalition to improve recycling practices nationwide and founded the Brewers Association Sustainability Subcommittee.
By promoting these practices in its own operations, New Belgium not only enhances its brand reputation but also sets a benchmark for ethical practices in the brewing industry. For instance, Sierra Nevada Brewing Company has also implemented several sustainability efforts, such as using solar panels and microturbine technology at its Mills River location in North Carolina.
These are prime examples of how working for the greater good starts with leading by example. Companies seeking to do the same should consider reforming their business practices to be more ethical in their sourcing and production processes and develop business strategies for social impact.
2. Form Strategic Partnerships with Nonprofit Organizations
Influencing systemic change is no easy task. It requires a deep understanding of society's problems and a steadfast determination to overcome them.
Strategically partnering with nonprofit organizations that directly tackle the world’s most pressing challenges can be an effective way for companies to boost their social impact.
An example is the partnership between Peet’s Coffee and Technoserve, a nonprofit that helps people in developing countries lift themselves out of poverty by building competitive farms, businesses, and industries. Together, the organizations spearhead the Farmer Assistance Program, an initiative that trains smallholder farmers to produce high-quality coffee.
Through the collaboration, farmers in countries like Ethiopia, Guatemala, and Rwanda have been equipped with business skills and knowledge of environmental sustainability best practices, enabling them to improve their lives and communities.
This joint effort illustrates the great strides that can be made when for-profit and not-for-profit firms combine their resources to work for the greater good.
Related: What Does "Sustainability" Mean in Business?
3. Encourage Employees to Volunteer
Being a purpose-driven firm requires an adherence to social responsibility that goes deeper than the organizational level. Employees need to share in the company’s vision for change and feel their contributions are meaningful.
Encouraging employees to volunteer is a practical way to involve staff in social impact initiatives and boost morale. In a recent Deloitte survey (pdf), 74 percent of workers said they believe volunteerism provides an improved sense of purpose.
At organic food producer Clif Bar, volunteering is an integral part of the company’s business model. Through the CLIF CORPS program, employees are encouraged to dedicate their time to issues and organizations that are important to them—and during work hours.
In 2017, Clif Bar achieved a major milestone when it reached 100,000 hours of community service—the equivalent of paying 48 employees to volunteer full-time for one year.
By fostering a culture that inspires employees to give back, companies can empower their workforce to engage with issues that matter to them and instill a sense of shared purpose.
4. Inspire Action with Corporate Platforms
Beyond implementing programs and initiatives to address global problems, using platforms like blogs and social media channels as advocacy tools can be a powerful way for businesses to push for change.
Outdoor clothing manufacturer Patagonia is one example of an organization that uses its far-reaching corporate voice to raise awareness of the challenges facing society, most notably surrounding climate change.
On its blog, The Cleanest Line, Patagonia recently advocated for protecting the Arctic National Wildlife Refuge from development and has previously voiced its support for such events as the People’s Climate March.
In addition, the company launched Patagonia Action Works in 2017, an online platform that connects people to nearby environmental activism opportunities. Since the tool’s inception, it’s been used to support grassroots campaigns to defend wild buffalo in Montana and preserve Oregon’s high desert, among other efforts.
Patagonia’s work to combat climate change represents the type of influence companies can have when they resourcefully use their communication platforms to inspire collective action.
Taking a Values-Driven Approach to Business
Large-scale change doesn’t happen overnight. Solving the world’s major social and environmental problems takes time and effort. But through a purpose-driven approach to business, companies can help create a more just and sustainable future.
Companies that prioritize social responsibility and environmental stewardship not only promote greater corporate sustainability but also enhance their competitive advantage.
By focusing on these long-term goals instead of simply profits, businesses can build enduring value and stronger relationships with their consumers, employees, regulators, and investors.
Adopting a values-driven approach also encourages innovation, opening up new opportunities for products and services that meet today's urgent needs while preserving resources for future generations. These innovations often result in operational efficiencies that reduce costs, enhance outputs, and minimize environmental impacts. Additionally, this strategic focus helps businesses anticipate and adapt to global regulatory trends and consumer demands, which increasingly favor sustainable and ethical practices.
Do you want to help your organization drive system-level change? Explore our online business in society courses, including Sustainable Business Strategy and Business and Climate Change. Not sure which course is the right fit? Download our free flowchart.
This post was updated on June 3, 2024. It was originally published on January 24, 2019.
