Four Ways Corporations Can Achieve Authentic Social Impact

By carefully identifying the right initiative and partners, and living by stated values, companies can move beyond marketing to achieving authentic social impact. (Illustration by iStock/Adyna)

A new age of consumerism that prioritizes data security, low environmental impact, and ethical behavior from the private sector is at hand. More and more employees and executives are making it clear that corporate commitment to social impact is non-negotiable. The Business Roundtable, a nonprofit association of American CEOs, for example, issued a statement last year arguing that the purpose of a corporation is to promote “an economy that serves all Americans.” Google employees protested “for the future of tech” in response to the firing of two co-workers who took issue with the ethics of certain company contracts and affiliations. And though it may still be just a rumble, the business community is beginning to take up climate-related policy change and advocacy initiatives in the wake of a 2019 United Nations report, which suggests that we have only until 2030 to stem global warming before it becomes irreversible.

On the consumer end, a study from June 2018 showed that 86 percent of Americans believe companies should take a stand on social issues, and a December 2019 survey found that 55 percent stopped using a product or service due to the company’s stance on a politicized issue. There’s also evidence that the call for corporate accountability will become status quo among younger demographics entering consumer leadership positions. One study, for example, found that 41 percent of millennial investors research a company’s role in improving society and the environment before deciding whether or not to invest.

To be successful in this new context, companies need to move beyond simply saying the right things to doing the right things. They need to create opportunities for action across all organizational levels, from the most junior positions to the board of directors, that will deliver social impact for real. Here are four ways to begin:

1. Find the Right Initiative

First, companies should identify a social impact initiative that aligns with an existing business interest. If an organization can find a cause that aligns with what the company already does, it will be better-positioned to gain community trust and make a long-term impact.

For instance, the technology manufacturer Cisco Canada uses its proprietary, two-way, video-conferencing tool to provide virtual education and mental wellness programming. Cisco designed the initiative to give remote indigenous populations across Canada access to resources they otherwise couldn’t access from their classrooms and homes. According to Cisco, 81 percent of students who attended virtual sessions from the Canadian territory of Nunavut reported feeling like they learned more than they would have in a traditional classroom setting.

Other companies are implementing more-sustainable practices by making changes to their products. Flooring products manufacturer Interface, for example, committed to sustainability years ago by shaking up the petroleum-intensive carpet industry. Over the last three decades, its development of new products has reduced the company’s waste-to-landfill by 91 percent, water usage by 88 percent, and greenhouse gas emissions by 96 percent.

These companies have accepted the business case for social responsibility and put real resources behind their commitments. As a result, their pro-social initiatives are fundamental to company operations, not just “nice to have,” and thereby avoid the risk of eventual employee and customer backlash. They also help show that a company is committed to doing something tangible to address an issue, not just talking about it

2. Assess Your Abundance

Companies should also think critically about what they can bring to the table beyond just writing a check. Certainly, the charitable sector relies on donations and money matters, but there are lots of other, less-considered ways to actively support social impact. Done well, dedicating personnel, supply chains, networks, and operations to causes can generate meaningful social impact, and build even more public goodwill and trust.

The Charles Schwab Pro Bono Challenge, for example, leverages company talent through skills-based volunteering. It connects employees to nonprofits to address specific business challenges, such as developing a comprehensive marketing plan for an organization that’s trying to elevate its profile and boost fundraising but lacks the necessary time and expertise in-house. An estimated 75 percent of nonprofits participate in the program for multiple years, and the total number of hours is significant. In 2018, for example, Schwab employees consulted with 60 nonprofits to deliver an estimated $490,000 in value.

A good example of a company engaging its supply chain for good is Walmart’s Project Gigaton. The project incentivizes suppliers to invest in sustainability measures, such as moving to on-site renewable energy, to help Walmart meet a meaningful goal: to reduce indirect greenhouse gas emissions across various supply chains by one gigaton within a decade. So far, Project Gigaton has delivered 93 million metric tons of supplier emission reductions. It’s also leading by example by currently getting 25 percent of its global energy from renewable sources.

Meanwhile, the retailer Lowe’s established a Clean Water Challenge that invited citizen scientists to build an affordable water purification system using materials found in its home improvement stores, leveraging its core product line to add societal value. Lowe’s teamed up with Singularity University, Socialab, and the International Water and Health Alliance to judge the challenge, and a winning team created a real, world-ready system capable of pasteurizing potable water that could scale to deliver 10,000 gallons of clean water per year at 1 cent per gallon.

All three programs, while focused on different subject areas and markets, take advantage of what companies hold in abundance, and continue to deliver value to global communities and the companies themselves.

3. Find and Build Partnerships

Cross-sector partnerships are nothing new, but companies stand to gain still more from them. Multi-sector partnerships can both support companies’ existing work and open doors to something new, and investment in research and nonprofit philanthropy can help expand the reach and impact of all three sectors. Connecting with academics, nonprofits, and other field experts can also boost a company’s credibility and show that it’s taking corporate social responsibility (CSR) seriously, not just marketing. To do this authentically and well, companies must truly value experts in the space, particularly those with lived experience.

In 2018, beverage company PepsiCo began partnering with six global development nonprofits to tackle water scarcity in areas where it operates. The effort builds on an established initiative PepsiCo launched in 2006 to ensure that underserved communities have access to fresh water for agriculture and food. This arrangement allows PepsiCo to engage global personnel and infrastructure already operating under the company’s CSR umbrella toward a larger goal—providing access to enough fresh water to meet the community agriculture, food, and public health needs of 25 million people by 2025.

Sometimes partnerships that help people and contribute positively to society can arise in unexpected ways; even fierce competitors can work together. McDonald’s and Starbucks, for example, announced a joint commitment in 2018 to design a fully recyclable, compostable coffee cup as part of a project called NextGen Consortium. So far, the initiative has inspired 480 environmentally friendly, single-use cup designs, 12 of which have undergone trial manufacturing and received approval to move toward distribution in select stores.

These projects illustrate how collaborating with across sectors and even counterintuitive partners can lead to fresh thinking and innovation.

4. Live Your Company Values

Today’s executives also need to showcase humanity by intertwining their personal values and stories into a corporate context. In fact, executives shouldn’t be afraid to assume the role of representing the company's character through their individual ideology when it makes sense. More and more consumers and investors are actively looking for like-minded or socially responsible CEOs and C-suite executives that “live” the values their businesses claim to hold dear.

In one recent example, Maple Leaf Foods President and CEO Michael McCain publicly expressed outrage at a series of political actions he felt unnecessarily escalated US-Iran tensions. These actions, he believes, contributed to the tragic crash of flight PS752, in which the family of one of his employees died. In making a public statement, McCain risked backlash from social media and shareholders, but he also stood for an issue beyond the bottom line. A subsequent article pointed out that while the economic value of McCain’s stance may never be known, his comments set a new bar for fellow executives to balance corporate risk with standing up for what they believe in. Combined with becoming the first major carbon-neutral food company in the world and working to tackle food insecurity in Canada, the company is living by its values for real. 

Higher standards for corporate social responsibility efforts aren’t going away, and nor should they. To meet with the increasing expectations of management, employees, and consumers, companies need to authentically commit to creating social change, make real business investments, form cross-sector partnerships, and be willing to take a stand. Slogans and one-off publicity stunts aren’t enough. To build a truly better future, industry leaders must invest in impact—and hold themselves accountable for achieving it.

Read more stories by Allyson Hewitt.