Today, many companies are going beyond earning a profit and have started making other values part of their top priorities. This trend of corporate social responsibility means that companies are trying to do some good in the world, in addition to making money. When companies dedicate time and resources to these social, environmental and economic causes, they are making corporate social investments. There are many different ways that companies invest in these causes.
What Is Corporate Social Investment?
Corporate social investment is a form of corporate social responsibility, which is a company's overarching approach or strategy for improving social, environmental and economic well-being. Through corporate social responsibility, a corporation may have multiple different tactics for achieving this strategy, including by making corporate social investments.
Corporate social investment occurs when businesses use money or resources for projects that improve the world around them, without there necessarily being a direct financial benefit to the company. A company's investment in social causes may take the form of money, gifts in kind, employee time or other resources. For example, a company may start a foundation to give out a scholarship or encourage its employees to take on pro bono work. A company might also donate supplies directly to people in need. A company may offer employees paid time off to volunteer at a local charity.
Why Are Companies Doing This?
There are a few different reasons why companies may choose to invest resources in social, environmental or economic causes. For starters, their efforts may generate positive publicity and news coverage, which can help them attract new customers. Each year, there are highly publicized lists that rank the most socially responsible companies in the United States. Companies may also invite members of the news media to events or volunteer outings, which can lead to positive news stories.
Pay and benefits are not enough for some employees, and many people are now choosing to work for companies that align with their social values. Therefore, some companies may be engaging in corporate social investment to attract and hire the best talent. Because corporate social responsibility has become a popular business trend, some firms may also be undertaking social initiatives to stay on par with their competitors.
Social responsibility may also be embedded in a company's mission from the get-go, particularly among startups. There is a new label for these types of socially conscious companies: B Corporations. Companies that earn a certification from the B Corporation parent organization are required to meet certain standards related to their social and environmental performance.
What Does Corporate Social Investment Look Like?
There are many different examples of corporate social investment from modern companies. The company Warby Parker, for example, donates money and eyeglasses to people in need around the world through its "Buy a Pair, Give a Pair" program. Duracell donates free batteries to families in need after hurricanes, tornadoes and floods through its PowerForward program. Microsoft's time-matching program donates $25 for every hour of the time its employees spend volunteering. Google matches employee donations to nonprofits and organizes an annual volunteer day each summer. Colgate-Palmolive gives free dental screenings and oral health education to millions of children around the world.