I initially started this blog to recognise the importance of the community that organisations work in and the need for businesses to respect and give back to that community. While this is important and still remains important, this part of the stakeholder equation is now far broader than just the immediate community and the traditional economic role of operating efficiently, offering employment and selling goods or services’.

Our concept of Corporate Citizenship now includes large programs that advance the interests of both the company and its communities. It involves the impact of the total operational activities of the company. So how does a corporately responsible organisation strive to make a profit, obey the law, be ethical, and be a good corporate citizen?

I contend that the decision to be a Good Corporate Citizen should not only be based on the imperatives of the business and the requirement of growth, but on what we as individuals think is right and proper. Examples of this might be requiring diversity in our workforce, ensuring that our products & services do no harm & add the value that our customers were seeking and expecting, that we do contribute to our community in an appropriate way, that we take accountability across the whole of the supply chain, that we act ethically and that we embrace our employees as a very important part of our business. Further, as for safety in the workplace, this decision to be a good corporate citizen has to become a way of doing business. It must be imbedded into “What we do and how we do it.” Success as a good corporate citizen will be when a business sees no decision to be made or choice to take. That the business clearly aligns with the goals of Good Corporate Citizenship.

So why is this so important? Certainly large corporations today are grappling with the issue of being a good corporate citizen. The consequences of poor decisions made by supply chain partners in far away Bangladesh in 2013 certainly had ramification in Australia. There are many examples of poor decisions, but many more of great Corporate Citizenship. As for large corporations, corporate responsibility is equally important to the SME sector. This sector employs 70% of the Australian working population. The decisions these businesses make and the consequences of their actions can impact not only the people they employ, but also the surrounding community, the extended supply chain, the reputation of their customers and ultimately their business viability. This is a large responsibility vested in the owners/managers of all small and medium sized businesses. Good decisions can make an iconic brand and give a business a competitive advantage, poor decisions can be catastrophic.

So what stops organisations from embracing their responsibilities as a good corporate citizen? Generally this is the perceived cost vs benefit equation. In business there are always costs to consider. However, the benefits, I believe far outweigh the costs. The benefits fall into two categories; those which are non negotiable and those that give businesses an opportunity to develop their competitive advantages

The non-negotiable benefits are:

    • Corporate financial performance
    • Reducing cost & risk
    • Preserving a license to operate

The second category benefits are:

    • Social investment, which strengthens legitimacy and reputation
    • Setting consumer behaviour and perhaps even determining trends
    • Human resources; an employer of choice with engaged employees
    • Innovation and a problem solver
    • Synergies that benefit all stakeholders

 Not all businesses have an equal ability to use their resources to develop the second group of benefits. Each business has to work out how they will contribute to the betterment of the community they work in.

As a small but salient example, I am reminded of an act of kindness by a green grocer store owner and his wife who helped a group of 5, 6 & 7 year old school kids across a busy highway (the main road between Melbourne & Sydney) each evening as we made our way home from school. There was no obligation on their part. This was not their job (we now have crossing supervisors!). They probably thought nothing of this gesture, but all these years later I see this act, as an example of how these people were showing their corporate citizenship within their businesses capability.

What can we do today that contributes to our community and improves the livelihood for all who have a stake in our businesses success?