Social responsibility can boost the corporate balance sheet

Many companies are concerned with their image and, in particular, how their customers perceive them.

Many companies are concerned with their image and, in particular, how their customers perceive them.

Take for example drinks maker Diageo, which uses the slogan "drink responsibly" on its products, acknowledging the fact that excessive consumption can be harmful.

To the public, this paints a picture of a caring company, as opposed to a large corporation simply seeking to make money.

While this may seem rather naïve, the idea of corporate and social responsibility is something that's becoming more and more popular in modern society.

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Many firms, including the large multinationals, want to be seen to be doing their bit to offer a helping hand, whether it's raising money for international disasters or offering some sort of service within their local community.

Amway, a US-based manufacturer of health, beauty, home and personal care products, with offices in Dublin, has had a partnership with children's charity Unicef since 2001.

However, the importance of the relationship was brought to the fore when the Asian tsunami hit the Indonesian coast in December 2004, leaving hundreds of thousands of people without homes.

While many individuals and companies offered help in the aftermath of the tsunami, the fact that Amway already had a relationship with Unicef helped it respond immediately with financial aid.

The company also encouraged its staff and distributors to engage in fundraising activities, such as auctions and raffles, and in just three months, the company's European operations raised €322,361.

However, social responsibility doesn't just involve providing money to help in a crisis. It's a concept that describes how the operations of a firm impact on society at large, hence the relevance of Diageo's responsible drinking campaign.

Such promotions, and Amway's partnership with Unicef, are often used to boost a company's reputation as a socially responsible business.

According to Amway, its association with Unicef, known as One By One, has in fact attracted new customers. When making a purchase, consumers base their buying decisions on many tangible factors such as product appearance and quality, but some also take into account intangible factors such as a company's social awareness.

Some people who are impressed by social responsibility are more likely to buy from Amway than a competitor because of this connection.

A spokeswoman for the company says that a central part of the group's heritage is the idea of giving something back, exactly what the Unicef relationship enables.

"One By One is a key part of Amway's corporate identity," she says. "It's a great way of engaging distributors, customers, those we do business with and beyond, in what Amway is and how we do business."

Still, not everyone has the opportunity to get help handed to them so easily.

According to Rachel Collier, co-founder and chief executive of Young Social Innovators (YSI), a programme set up to develop social awareness and activism amongst young people, too many companies simply talk about social responsibility, but don't actually put their money where their mouth is.

She is also critical of the Government, saying that the education curriculum fails to teach students about the need to be socially aware and to take responsibility for their own actions.

As a result, she set up YSI with the aim of "firing young people's passion to change the world". As part of the programme, students are required to identify a social issue they feel they could help to change - the topics range from local to national issues and include areas such as homelessness, facilities for disabled people, cancer care provision and animal rights.

They then study the problem and through research and meetings with the people concerned and relevant organisations, identify ways of improving the issue.

"Young people are very perceptive and it's a great time to increase their awareness of what's going on around them," she says of the project that's currently aimed at transition year students.

"It also gives them the chance to come up with a solution to problems that concern them."

This year's YSI, which received entries from 3,500 students from 116 schools, who had undertaken 230 social action projects, has been showcased at CityWest this week.

"It is important that we all do out bit," says Collier, adding that if the idea of social responsibility is taught in schools, then there is more of a chance that the students will take it with them to their later lives and careers. "Everyone has this passion, but it needs a spark to set it off."