In a time of protests over climate change and growing awareness about the importance of sustainable business practices, many construction companies face mounting pressure to demonstrate their social responsibility to local communities and society as a whole.
This is the impetus behind corporate social responsibility (CSR) — a means for organisations to show their commitment to “doing the right thing.” In recent years, CSR has gone from being “nice-to-have” to an essential strategy.
For instance, a 2019 report by insurance firm Aflac shows that 77% of consumers are motivated to buy products and services from companies committed to making the world better. Additionally, 25% of consumers and 22% of investors will completely avoid companies that embrace ethically questionable business practices.
Large organisations have naturally taken notice. It’s estimated 90% of companies on the S&P 500 index published a CSR report in 2019 — a massive increase from 20% of companies that did the same in 2011.
What you can expect in this article:
What Exactly Is Corporate Social Responsibility?
Depending on who you ask, CSR can be a set of principles, a management concept or even a business model. Whatever the case, the overarching goal of most CSR initiatives is the same: to hold the company socially accountable to its employees, customers and the public.
CSR is a form of self-regulation willingly undertaken by companies that want to improve their reputation within their community. The idea is that by taking responsibility for your construction firm’s impact on society — whether it’s through the environment or the livelihoods of people — you can:
- Bolster your brand’s image
- Resonate with customers that share your values
- Boost employee morale by demonstrating your values and principles
- Attract top talent (case in point: 62% of millennials want to work for organisations that positively impact the world).
Common CSR Strategies
There are no hard and fast rules when it comes to CSR. It all boils down to what makes the most sense and feels the most natural for your construction organisation and stakeholders.
Still, most CSR programmes tend to focus on four key areas:
Embracing sustainable and environmentally friendly initiatives is perhaps the most popular area for modern CSR programmes. The basic idea is to improve your practices to lower your impact on the environment, whether it’s by reducing your carbon footprint or sending less waste to the landfill.
For example, construction companies can take the environmental angle and commit to using more environmentally friendly materials (e.g. cigarette butt bricks), on-site water treatment plants for waste reduction and renewable energy sources.
Construction companies ahead of the curve are already seeing the benefits of their sustainable practices. In one study, 75% of firms report that sustainability improved their resource usage, while 62% said their project quality had improved.
2. Ethical Practices
Many commercial activities are technically legal but widely considered to be unethical. These include underpaying workers, doing nothing to promote work-life balance and inequitable hiring practices.
Construction companies can emphasise their ethical standards by committing to labour practices that comply with the law and hiring underrepresented groups in the construction industry, such as people of colour, women and members of the LGBT community.
Philanthropic activities are arguably the oldest form of CSR. During the industrial age, tycoons like George Peabody endowed libraries and museums in the US and funded housing for the poor in London.
Today, philanthropic CSR activities typically revolve around the social causes an organisation believes in, such as fighting climate change or caring for the elderly. Some construction firms also have their own foundations and charities, allowing them to take a bigger role in raising awareness.
4. Economic Responsibility
Every business has an economic responsibility to its customers, partner suppliers and investors. Integrating CSR into your economic responsibilities introduces ethical considerations that encourage you to go beyond maximising profits. For example, construction companies can choose to work with local suppliers of raw materials to stimulate the local economy.
Going beyond Paying Lip Service
One of the common criticisms of CSR initiatives is that it’s simply another commercial concept — worse, one that pays lip service to social causes and problems all in the name of the bottom line.
Admittedly, there’s some truth to this; too many companies claim to be sustainable for CSR purposes but don’t pay their employees living wages, for example.
If you’re going to launch a CSR initiative, your construction firm needs to commit to your CSR goals and to doing good in general. In other words, social responsibility should encompass everything you do and stand for.
You can also use accreditation systems to show your stakeholders that you’re taking your CSR goals seriously. Third-party assessment services like CHAS can verify that you provide safe working conditions to employees, have fair hiring practices and support local communities.
Potential clients will also see your accreditation as a seal of approval, helping you win tenders and develop new business relationships.