One question I am often asked is: How is Corporate Social Responsibility (CSR) different from Social Impact?
Understanding this distinction is crucial to avoid one of the most common pitfalls in effective social impact measurement (more on this in the next blog!).
What is Corporate Social Responsibility (CSR)?
Corporate Social Responsibility (CSR) refers to the practices and policies that companies adopt to create a positive impact on society. At its core, CSR focuses on a company’s voluntary actions aimed at improving its environmental and social footprint.
CSR initiatives typically include:
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- Philanthropy: This might involve financial contributions to food banks or other charitable organizations.
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- Community Engagement: Activities such as volunteering to read to children or distributing food packages to underserved communities.
These efforts reflect a company’s commitment to acting responsibly and ethically, but they often concentrate on individual acts of kindness rather than systemic change.
What About Social Impact?
In contrast, Social Impact encompasses the broader consequences—both positive and negative—of an organization’s activities, policies, or initiatives. It looks beyond the immediate actions to evaluate how these actions affect the well-being of individuals and communities. In fact, it’s impossible to separate social impact with the people and community that it operates in.
Social impact can be observed in various areas, including:
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- Worker Compensation: How fair wages and benefits are distributed among employees.
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- Supply Chain Partnerships: The ethical considerations in sourcing materials and engaging suppliers.
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- Local Community Support: The overall effect of a company’s presence in a community, including job creation and infrastructure development.
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- Hiring Practices: How inclusive and equitable a company’s recruitment strategies are.
The table below that summarizes above key differences between CSR and Social Impact:
By distinguishing between CSR and social impact, we can better assess the effectiveness of our initiatives. While CSR focuses on individual efforts to contribute positively to society, social impact examines the broader implications of those actions.
By Pia Wong, Founder & CEO, Purpose Impact Action
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