What are the Social Objectives of Business?
Businesses operate within society. Society gives so much to business in terms of human resources, and physical and natural resources. So, businesses set up some social objectives to create a positive impact on society. These objectives may include environmental protection initiatives to charitable donations to increase energy efficiency. These are some social objectives of businesses:
Environmental protection
Environmental protection ranks top on the list of social objectives of businesses. Most of the companies are investing in green initiatives like tree plantation drives, increasing energy efficiency, and cleanup drives. The goal of the companies is to reduce their carbon footprint by using renewable resources. These sustainable business practices improve the brand image of the company and help to attract new investors and customers.
Supplying quality products
Businesses sell products and services to the customers who are a part of the society. Thus, it’s the major social objective of the business to provide better quality products at a reasonable price. It is the corporate social responsibility of businesses to keep away from behaviours like hoarding, black marketing, and manipulative advertisement.
Employment generation
Businesses are responsible for generating employment in the community where they operate. It is their social objective to provide chances to the local people residing there. It boosts the economy of the local community and nation as well.
Employee diversity
Employee diversity is an important social objective of businesses. Companies are putting a lot of effort into hiring people from different backgrounds to create an inclusive and diverse workplace. Diverse workplaces are extremely productive as different people bring new ideas and concepts with them. Employees are an asset to the business. Thus, giving fair remuneration to the employees and looking after their well-being is critical.
Charitable contributions
Companies support charitable causes that create a positive effect on society. They either donate to organisations, non-profits, or charitable trusts working towards social causes like education, hunger, poverty, etc. or donate goods and services to those in need.
Social contribution
Businesses can also aim to give back to the local community around them. They can do this by donating to the local charities or working for the local causes. They can offer internships, apprenticeships, or jobs to the local people. This improves the quality of life of the people.
What are the things society provides to a business?
There is a strong connection between business and society. As society needs business for goods, products, and services, business needs society for a range of things. Here are some things that society provides for businesses to operate:
- Resources: Society provides natural resources to businesses for its successful operations. Resources like land, trees, water, oil, gases, energy, raw materials, and many other resources are used by the businesses.
- Labour: The local community where the businesses are established and operate provides a labour force. Local people work in their plants, factories, and offices and ensure the smooth functioning of their operations.
- Consumers: Businesses sell their products and services to the people of the society. These people are their consumers and help them earn profit.
- Legal and regulatory framework: People select the government, and it frames the legal and regulatory framework for the businesses. This framework helps businesses to operate in a fair and transparent atmosphere.
What are the reasons to have social objectives?
Businesses play a crucial role in society, so they should work for the welfare of society. This concept is called corporate social responsibility. It is defined as a concept where businesses should not only focus on maximising their profits but also consider their impact on the environment and society. Here are some reasons why social objectives are important:
- Community improvement: Social objectives help the companies to work for the welfare of the local community, creating a positive impact. It increases the standard of living of the people around the businesses.
- Building brand image: Many customers and investors are attracted to environmentally friendly brands. Social objectives of business helps them to create a brand image. A good brand image helps the firms to develop strong relationships with the customers and investors.
- Attract and retain talent: Modern employees are striving more for work-life balance and positive work culture. Companies can demonstrate their social objectives as an attribute to attract potential hires. The tag of a socially responsible company can help them retain the best talents.
- Increases reputation and popularity: Working for social causes increases the popularity and reputation of the company. It indicates stakeholders, partners, and investors that the company is on the right path. This can lead to increased sales, investment, and collaboration opportunities.
Benefits of social objectives of business
Social objectives of businesses benefit society, the local community, the environment, and the businesses in the long term. These are the goals of the companies that focus on the well-being of the local people, customers, and employees. Here are some benefits of the social objectives:
- Increased engagement and productivity: Setting up social objectives gives employees a sense of purpose and motivates them. They feel satisfied with contributing to social causes. It helps to increase employee engagement, ultimately increasing the productivity.
- Attracting customers, investors, and employees: Companies working on social objectives display that they are making a difference in society. This aids in improving their reputation and attracts customers, investors, and top talent in the job market.
- Increased loyalty: Customers are likely to be more loyal to companies that have social objectives. This makes customers feel that they are contributing to saving the environment by using the products of these companies. So, they support socially responsible businesses.
- Saving cost: In the long term, social initiatives like increasing energy efficiency and using renewable resources reduce the cost. This helps to save companies money and also reduce their carbon footprint.
Examples of social objectives of business
There are many types of social objectives that businesses can set. Here are some examples of social objectives of business:
- Companies can donate: They can give cash or resources to non-profit organisations or charities working for social causes. It can both help to improve the lives of those in need and serve as a sign of the company’s commitment to social responsibility.
- Less utilisation of natural resources: Minimising the use of natural resources can be accomplished by cutting back on energy and waste production, as well as recycling the water used or rainwater harvesting.
- Use of renewable resources: Investing in renewable resources like solar panels. Electricity produced from solar panels can be used to light office buildings as well as run data centers.
- Offer Education: Companies may also decide to give their staff members access to educational resources. It can take the shape of giving staff members awards or scholarships, or it could involve delivering training and development programs.
What is the difference between ESG and CSR?
ESG and CSR are linked to the social responsibility of the company. Corporate Social Responsibility (CSR) qualitatively measures the social responsibility being taken up by businesses. On the other hand, environmental, social, and governance (ESG) helps to quantify such social efforts. Investors use ESG criteria to screen potential investments.
How can small companies be more socially responsible?
Every small initiative towards society can have a positive impact on the community. Small companies or startups may not be able to make donations. They can start by organising small fundraising events, encouraging volunteering, tree plantation drives, education programs for employees, or even joining other companies with similar mentality.
Social objectives can help businesses in two ways to become successful. The first one is creating a positive impact on society, and the second is gaining profits in the long run. It helps companies to build relationships, attract and retain talent, and improve their reputation. Choosing the right social objectives according to the interests and mission of the company can prove fruitful for businesses to achieve their goals.
