Have you ever wondered how small and medium-sized enterprises (SMEs) stand in terms of CSR and sustainability in the Czech Republic? We decided to find out and conducted a survey that focused on business activity in this area. We investigated what is the awareness of CSR among those companies, whether they engage in socially responsible activities and how intensively, and what benefits CSR brings them. We also wanted to know the barriers that companies perceive when introducing CSR principles into corporate culture.
According to small companies, CSR means responsible approach to the communities in which the company operates, both at the social and environmental levels. The company should strive to actively improve its surrounding communities, cares for its employees (including work safety) and at the same time lead them to a responsible behaviour.
CSR activities of smaller companies include e.g.
- ecologic production,
- responsible purchase,
- support for local communities,
- engaging in activities improving the environment and the life of the community, society, employees and the company itself, incl. mutual relations.
It is a strategic process of company management, which involves building relationships with partners with an emphasis on responsible behaviour in the company and the environment in which it operates and which it also influences. As part of the strategy, it is important to remember that this is about transparency, social and economic issues and environmental protection.
Research conducted by 50 Czech SMEs during autumn of 2019 showed that as many as 75% of all respondents work with CSR in practice. Seventeen percent are aware of CSR and eight percent know CSR "only" based on the social behaviour of other companies.
At the same time, three quarters of respondents answered positively whether they knew the principles of CSR. Others have at least some idea of them. Research shows that being a socially responsible company means that the company is actively involved in areas that focus on stakeholder needs, the environment and innovation and responsible business.
The main themes in the social field are:
- human rights,
- eliminating discrimination and promoting diversity (equal opportunities),
- care for employees (their professional development, education, work-life balance) and customers,
- support for local community.
Examples include active support of the non-profit sector, donation and fundraising, support for volunteering among employees, education and training of young people (e.g. teaching at the University of Economics, where the know-how of the company is transferred within two subjects), or employment of people with disabilities. It also includes fight against corruption.
Companies recognize that they must be environmentally responsible and that it is desirable that they do business sustainably. The necessary activities include:
- preventive measures to mitigate negative environmental impacts, such as waste separation,
- protection and careful management of natural resources,
- promoting eco-innovation and new technologies, such as electric cars.
CSR should definitely be planned strategically and its implementation should be given special attention. Companies report that social responsibility involves the voluntary integration of social and environmental approaches into the day-to-day business. For example, recycling is a matter of course for all, there is no discrimination in employee selection procedures, all employees know that it is necessary to use resources sparingly, human rights are among the priorities of the company, etc.
Almost everyone (92%) said they apply CSR principles in their company. Those who do not would like to implement them.
Reasons for social responsibility
We were interested in what led companies to take up corporate social responsibility. Most often it was a natural development and also, the interest of employees had a great influence. Social responsibility in some companies is part of the PR strategy.
The least decisions on implementation of CSR were influenced by legislation, the interest of investors and shareholders. On the contrary, external impulses had a big influence, including:
- customer interest,
- competitive advantage,
- improving name and reputation.
Last but not least, the value management system plays an important role as well as the personal set-up and values of people who promote CSR in the company.
What are the benefits?
An important point of the research was the benefits of CSR for companies. In a way, according to companies, this should be natural – the company and its employees return to the communities what it has put in them. A personal value attitude which involves helping others can also play a role, and this leads to a better feeling at work. This can be a good motivation for employees, which has an impact on employee productivity and employee loyalty. CSR can bring the company a long-term competitive advantage – permanent workers, interest in employment in the company, good reputation, which usually leads to growth of orders.
Responsibility towards the environment and people and a responsible approach to entrepreneurship have a positive impact on:
- corporate culture,
- environment,
- building a better future for society as a whole.
Time can be an obstacle
Lack of time is considered as the biggest barrier in introducing CSR into corporate culture. Other frequent barriers are lack of information on CSR strategy and bureaucratic burden. The costs and lack of general information, conceptual thinking about CSR and personal engagement have some influence.
So, what is the result…
SMEs realize that CSR plays an important role in their business, they know or at least are aware of the principles of social responsibility and try to work with them. At the same time, they are aware of barriers that complicate or prevent the implementation of CSR activities.
It is positive that work on CSR is considered a natural business development and that employees themselves have a great influence on CSR. Research suggests that companies perceive CSR not only as “charity”, but also know the benefits it brings. These include positive reputation, employee loyalty and motivation, competitive advantage, as well as minimisation of negative environmental impacts and maximisation of benefits for the company. Employees usually want to feel good about their work and return the community what they have gained during their business.
Now what?
SMEs need to realize that new opportunities and business benefits are part of CSR. When CSR is a full-fledged part of company's strategy and time and money is invested into it, it will bear fruit in competitiveness, employee loyalty and reputation. CSR is not just for big companies. At least the basic principles work in all companies across their sizes and industries.
The research also shows that it is necessary to emphasize the education of the Czech business environment in the field of CSR. Investors and shareholders themselves should perceive social responsibility as one of the decision-making aspects in choosing a company to invest in.
CSR should become a natural part of the company regardless of its size.