The terms philanthropy and CSR or to use it’s full name, Corporate Social Responsibility are often used interchangeably, but they are not the same thing. Although philanthropy may be a part of the CSR strategies of a business, there is much more to CSR than simply philanthropic gestures.

Many companies partake in acts of philanthropy, this is often in the form of a charitable donation, perhaps donating a percentage of profits to a charitable concern. It’s a simple act, that while making those at the top of business feel like they are doing some good, it doesn’t really have a huge impact on the business. Many employees, and the wider community may not even know that this act of philanthropy has happened.

Corporate Social Responsibility has much wider coverage and a greater impact. CSR looks at the company as a whole, and encourages business to take responsibility for their impact on the environment, their employees, the local community and beyond. While acts of CSR are generally considered to be good, to be caring and thoughtful, there can be a lot of advantages to a business when putting in place a far-reaching and well thought out CSR campaign.

Being a socially responsible corporation puts that business in a good light. These days, the ethical and environmental actions of a business is increasingly important to consumers. Customers can feel so strongly about the ethics of a company that they will boycott a business that they have previously been customers of, avoiding a product they desire and need because they don’t agree with the way in which the company runs their business. This may be the exploitation of employees, or being wasteful with natural resources. You will probably have seen in the news, if a large business is found to be using low paid foreign labour, with bad working conditions, it makes for shocking headlines. Likewise, if it is discovered that a business is sourcing wood from a non-renewable source, or pumping toxic waste into our rivers, the public will be up in arms. The impact on the businesses involved can be dramatic. A good reputation built over decades can be lost overnight with a negative news story, and that can often result in a loss of income.

On the flip side, being ethically responsible, and ensuring the public know you care for your employees and the environment, puts a business in a positive light. While you can’t build a business purely on good ethics, it will help to great an overall positive view of your company in the eyes of the consumer.

While a business may have a place in a global market, it will always have to deal with the local community too. This will often be where most of the staff are sourced from, and any large business will impact on a community both environmentally and socially. The bigger the negative impact, the more effort a company needs to go to, to reassure the community that their heart is in the right place, that they are prepared to do what it takes to minimise any negative effects of their business on the local area. For example, if you own a factory that is pumping out gases into the air from large billowing chimneys, it would be very sensible to liaise with the local community to allay any fears that these gases are toxic and perhaps start a tree planting project to enhance the beauty of the area. There is definitely an aspect to CSR that involves keeping people on side!

Treating staff, and the local community well, reflects very well on a business and can bring its own rewards. Happy staff who feel looked after are more likely to be loyal to the business, to work hard and recommend the business as good employer.

Lincoln Martin is pioneering a “social impact” business model, called Client+Agency+NGO Partnership (#CANpartner). To learn more on CSR, philanthropic marketing projects and how to give back to the community, write to ems@lincolnmartin.com.