Why startups should embrace CSR initiatives from day one
Mark Grimes, co-founder of Startup Radio Network, a live-streaming and podcast network offering a variety of shows focusing on entrepreneurship and startups. Startup Radio Network supports women entrepreneurs in developing countries by providing 10% of gross revenue through the Kiva microfinance platform
While governments bicker about climate change, gun control and other social issues, corporations are taking action. Last year, the U.S. saw an increase in corporate social responsibility (CSR) efforts, with annual profits surpassing tens of billions of dollars. However, this increase in generosity, as positive as it may be, isn’t reciprocated by startups.
In the flurry of building a product, signing on investors, and all that other stress that comes with launching a startup, CSR is almost always left on the sideline. The majority of startups will spend years dedicating time and effort to succeeding as a company before they even consider avenues in which they could give back and engage in social change. But are they missing out on an invaluable opportunity?
CSR should not be limited to global giants, nor should startups have to wait for a hundred million dollar exit to start giving back. CSR initiatives can be implemented in ways that don’t rely on corporate foundations or involve huge donations. In fact, as more consumers and employees look to align themselves with philanthropic brands, startups could benefit from putting purpose before profit.
So, as a startup founder, here are some tips to help you get started:
Match company with cause
First things first: Find a non-profit that relates to your industry. A startup in the publishing business, for example, could plant a small seedling in their name for each book that is published. Strategically collaborating with an organization parallel to your brand or business will not only better support the organization’s cause, but also serve as a suitable marketing strategy. Building an appropriate partnership in the early days will also help your audience better understand your values as you grow, making them more inclined to engage.
Knowing your client base and what social issues they are passionate about is another important consideration when picking a CSR path. If your consumers are mostly women, then it would make sense for you to work with non-profits or social projects promoting women’s rights. This goes for your employees, too. Employee turnover is common in startups, so boost employee morale by giving them the chance to get involved in a non-profit they believe in. A recent study found that millennials see a company’s commitment to social and environmental responsibility as a key factor in their employment decisions. Seventy-five percent of millennials even say they would take a pay cut to work for a responsible company. Ensuring your target audience and your employees share a mutual interest in your chosen cause will inspire your team and keep customers coming back.
Commiting to certain projects and charities can massively help attract and retain conscientious customers who share the same view. The day Melania Trump wore a jacket that read “I really don’t care do u?” while visiting detained immigrant children in Texas, women’s clothing company Wildfang took the opportunity to turn negative social media around the event into a positive cause. They created their own jacket with the words “I really care, don’t u?” written on the back, and stated they would donate 100 percent of the proceeds to RAICES, a non-profit providing legal support to immigrants. Customers from around the world flocked to their site and within hours Wildfang had raised $250,000 for the organization.
Make your efforts public
Although companies should of course launch CSR initiatives for the right reasons – to give back and make a change – scaling startups can really benefit from prioritizing social responsibility and being public about it.
Instilling a CSR model within a company is almost expected these days, and can be a means of drawing in customers. Sixty-six of consumers are in fact willing to spend more on a product if it comes from a socially responsible company. This statistic is even higher among Millennials – 81 percent of whom expect companies to publicly declare their corporate citizenship. It is therefore crucial that startups publicly broadcast their CSR efforts.
Using social media, community channels and newsletters to keep your consumer base up to date with the results of your social projects can be an effective growth strategy. Being transparent is fundamental to CSR and company success. Include a signature file in all staff email correspondence which permits recipients to transparently see your company’s progress in its CSR endeavors. Set goals and targets can also be displayed here to keep customers in the loop and connected to your startup.
Celebrating your startup’s social impact through press releases and pitches can also help drive interest and improve visibility. Not only does this publicity give clients something to be receptive about, but it can also help you stand out. After all, people are more taken with social good stories than the launch of a new product.
Dive right in
Building a CSR presence from day one may seem daunting for a startup struggling to cement itself in its industry. However, forging outside connections and partnerships is, after all, the foundation for any company.
VCs, Angel investors and philanthropists are increasingly paying special attention towards startups who are giving back. Diving head first into social responsibility efforts could therefore open doors to working with accelerators and funds committed to supporting social enterprises. The Social Impact Accelerator (SIA) in Europe and The Social Enterprise Alliance in the U.S. are just two examples.
Remember, CSR is not confined to money donations. Even the smallest of startups can implement efforts such as an employee volunteer day, or by holding workshops in-line with their industry for immigrants. At Startup Radio Network, we began hosting pitch events for minority groups to. In the past we have organized a Whiteboard Pitching for Portland based LGBTQQ startup founders, and earlier this year we teamed up with Women Led, a nonprofit creating a community of women leaders who are building profitable and sustainable businesses that will positively impact the economy, to organize an open conference.
So, rather than wait years for your startup to reach its golden potential, establish CSR initiatives from day one. As well as playing your part in implementing and promoting social change, these steps towards social responsibility will boost company culture, attract clients and scale your startup. And hey, even if it all blows up in your face, at least those first years won’t have gone to waste.