Commitments Need Execution
Making promises or commitments is a good way for businesses to set realistic and measurable goals. These can help the public and other stakeholders witness the GREAT progress they are making. However, these commitments are only possible if organizations execute them.
CSR V. CSV
Corporate Social Responsibility (CSR) is a form of international private business self-regulation which aims to positively impact and contribute to societal goals by engaging in or supporting ethically oriented practices. Often companies achieve this by Creating Social value (CSV); this is done by listening to and respecting the needs of consumers and other stakeholders involved in the process. Creating Shared Value also means developing long-term solutions to societal and environmental issues that help maximize profit and optimize the business.
A GREAT EXAMPLE
Thirty years ago, coffee growers were most prone to exploitation in underdeveloped countries. Knowing this, illy, an Italian coffee company, committed to creating a safe sector for workers in these regions to be treated fairly. Not only did it work to produce great coffee beans and ensure the company is paying premium prices, but it also cooperated closely with suppliers. This is to create and maintain a sustainable supply chain by collaborating with suppliers to perfect the growth process and ensure that quality is retained.
STRENGTHENING THE STAKEHOLDER NETWORK
Instead of purchasing the beans for the lowest price, illy decided to work directly with the suppliers. The coffee chain then started investing in improving its environment. It supported rural schools, promoting good waste management and correct water treatment, as water is one of the key ingredients in transforming cherries into beans. By analyzing all stakeholders involved, it successfully improved the quality of life of their suppliers, enabling the production of a higher grade of products while creating social value (CSV). These factors allowed illy to set higher prices and increase its profit.
Working to create social value and committing to corporate social responsibility is a GREAT way for an organization to impact the environment and society as a whole positively. The key takeaway from the example illy sets is that commitment must have the execution to create change. Investing in suppliers is one way to improve any organization's product and profit and the societal and economic situation of countless lives in the process.
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