Many entrepreneurs start a company because of a unique idea for a new product or service, a disruptive solution to a current problem, or simply because they like building brands. Some entrepreneurs also start companies to help communities, to foster change, or to support a social cause close to their heart. In the best-case scenario, a company should not only add beneficial goods or services to the marketplace but should also benefit a community or communities through activism or social impact.
Building a component of corporate social responsibility into a company is not just a “nice” thing to do – it can actually be a driving force for business, too. Brands built for social good resonate strongly with the millennial and Gen Z populations, which together account for up to $343 billion in purchasing power. According to statistics, 87 percent of Americans are willing to buy from or boycott companies based on corporate values and 81 percent believe companies should make a public commitment to corporate citizenship. With the majority of consumers demanding corporate social responsibility, it’s important that new brands to the marketplace listen and take action in order to capture the attention of potential shoppers – and help others along the way.
Entrepreneurs looking to start a company or organization that gives back should start by diving deep into the issues that matter to them, says Rachel Dodson, founder and CEO of Penh Lenh, a Cambodian-based jewelry company that reinvests all product sales into its mission to provide education, vocational training, and advanced career opportunities for the at-risk female artisans it employs.
“Get to know the people or cause that you are wanting to help through your business,” Dodson advises. “Ask questions to find out what will truly make an impact. Then, write down your goal, purpose and/or passion for the business…deep down, what drives you to want to start your business?”
Dodson started Penh Lenh after a visit to Cambodia where she learned first-hand about some of the problems faced by local women, such as sex trafficking or lack of financial independence. She left her job at an NYC modeling agency to create the jewelry brand with the goal of empowering women through education and job opportunities.
From experience, she knows that it’s not always an easy balance between running a business and living out the brand’s mission, no matter how resolute the founder is about making a social impact. The good news is, a company’s purpose can be incredibly centering for business owners when times get hectic.
“I guarantee there will be a time in the future when you are so busy, stressed or overwhelmed that you might lose sight of your social purpose,” she says. “Just pull out that piece of paper and remind yourself of your purpose and your passion.”
For existing brands without a social impact statement, it still possible to begin to incorporate activism into daily operations or long-term goals. The process is similar to how new entrepreneurs find their social mission: identify a passion that aligns with the brand, research how to best make a positive change, and always keep the greater good in mind.
However, there are some instances where activism can hurt a brand – usually when the cause or campaign is created for ulterior motives other than truly giving back. Consumers can identify when brands are being inauthentic. For example, the infamous and controversial Pepsi ad with Kendall Jenner was a seemingly well-intentioned campaign from the brand but caused outrage as audiences did not think it was emotionally genuine.
While both large companies and entrepreneurs alike should do their due diligence before jumping into activism, Dodson believes that all companies must incorporate social responsibility into their business in some way or another. If not directly benefiting a community of people in need, brands can also look to become more sustainable or eco-friendly through their social impact mission.
“We have to take care of one another and our planet,” states Dodson. “And I believe that even on the most basic levels, companies should be held to a higher standard in terms of environmental responsibility as well as how they treat their employees.”
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