Many businesses and startups are now shifting their frameworks and operations to create a social impact. Other organizations were founded on the basis of creating a social impact as their guiding mission. The outcome in both scenarios is good news for society as a whole – but are companies getting it right?
In general terms, having a ‘social impact’ can mean a multitude of things, ranging from promoting gender inclusive workplaces, to having a carbon positive footprint. It can also entail a business utilizing an innovative thinking approach to resolve societal issues. It could mean being a sustainable business for some, and operating as a purely social enterprise for others. What does and should it mean for your business?
Simply put, businesses do not need to be operating as social enterprises to make a difference and create a positive impact. The positive influence on society can range from enhancing social capital as part of its operational framework, the practices across its supply chain, or the types of goods and services provided in the market and how they are made.
So how do you get started?
Understand why social impact is important
Whilst creating a social impact is not a legal requirement in Lebanon or in most countries across the MENA region, society and different stakeholder groups can benefit greatly from companies operating more ethically and responsibly.
Having a social impact can be of great value when it comes to a company’s Millennial generation customers, who are search for ethical and responsible companies to work with or buy from. Consumers are becoming more inclined to choose brands that are ethical and responsible in their practices, tackling social issues that are important to them.
Businesses with a social impact can also attract top talent, as candidates can be more motivated to working with companies that do good. This could range from working with companies whose mission and vision they support, or one that is dedicated to a social cause that matters to them.
It can also go a long way when raising funds, as a growing number of investors are on the lookout for companies that have a social impact, along with financial returns. In addition, gender-lens investing is gaining traction, which means that investors are keen to invest in companies that are dedicated to female empowerment. This could range from a company tackling issues that women and younger females face globally, or are committed to promote women’s leadership and inclusive practices across the organization.
Ask the right questions, to get honest answers
The first step is to assess where the company or startup stands today. What are its guiding principles and goals? Do its employment policies, environment practices and community programs contribute to positive and sustainable change? And depending on the answer, can it be doing better? This step requires a lengthy and honest deep dive into the core of the organization.
Set the intention and start small
Setting out with the intention to change the world through social impact initiatives can be overwhelming and will most likely result in a few failed attempts. Start small and in areas that you are confident your company or team can create an impact.
Choose initiatives that are true to your brand or company, and are directly aligned with your mission. Social impact efforts are most effective when they utilize the core skills of the organization or directly aligned with the company’s expertise.
How do you measure social impact?
Measuring social impact can be tricky and should be based on the metrics that have been outlined. Companies that are not social enterprises, can assess the number of people benefiting from their initiatives and in what ways. It could include stakeholder mapping and the impact the organization has had on different groups and geographic areas. It could be measured from a sustainability perspective, when it comes to operations or products. Whichever measurement tools are used, reporting on social impact can go a long way, with different stakeholder groups.
As the world continues to transform, and numerous challenges tied to inequalities in the workplace, the pandemic’s repercussions, climate change and social injustices emerge, operating ethically and responsibly should be on every company agenda. Resolving social challenges with impact-driven initiatives can go a long way, and create a ripple effect, encouraging others to follow.