Social Impact Definition and Why It’s Good For Business

Our world is becoming increasingly connected, changing how we think, how we act and the way we buy. Consumers expect more from brands and businesses than ever before, and this continues to translate into a heightened responsibility for the collective good. 

Through social media, the 24-hour news cycle, instant messaging and ever-evolving online capabilities, brands are increasingly connected to their customers and the world around them. 

This interconnectedness is often seen as a force for good, helping connect people worldwide and creating greater senses of purpose and commonality. 

Increasingly, businesses and brands are starting to address this force for good and leveraging their influence and power to help make positive changes in their communities, either locally or globally.

Today, we’ll be discussing social impact for businesses and how a sense of corporate social responsibility is critical for businesses and our society.

What does it Mean to be a Social Impact Organization?

A social impact organization (or social impact business) is, in broad terms, an organization or company that goes above and beyond to continuously address a local or global need through sustained and consistent business practices and initiatives. 

A social impact business is a business that is built on the premise that corporate social responsibility should be valued and profits are not the sole motivating factor for a business owner’s decisions. 

Social impact businesses prioritize contributing profits, products or other resources to particular causes that align with their industry and business model. Social impact organizations make a continued effort to do work that is consciously, systemically and sustainably supporting a local community or global need.

Many businesses offer some social impact element in their business model. Still, a genuine social impact business or organization makes their corporate social responsibility an integral part of their business model, identity and marketing, not merely an add-on feature. 

 

Corporate social responsibility doesn’t just help the planet, it helps your bottom line, too. Learn more in Corporate Social Responsibility – Why CSR Benefits You.”

Why is Understanding Social Impact Important For Businesses?

social impact benefits

Understanding the scope of social impact is critical in creating a socially responsible business that can proudly share their good work. 

The social impact goes beyond donating profits to causes or charities; it embodies your organization’s ethos from beginning to end. 

When creating a social impact business, there are a number of necessary steps and considerations business owners must take, including:

Finding a cause that is focused and aligned with your brand

This can often be one of the most challenging elements of exercising corporate social responsibility: narrowing your focus and being comfortable in doing what you can. It seems everywhere we turn; there is a new cause or social justice issue that we’re ready to tackle. 

But unfortunately, a scattered focus spread between too many causes or charities will limit your business’ ability to do real, tangible good. While there may be a million and one causes worthy of your time and support, it is important to pick a cause that is aligned with your brand vision, mission and industry. 

Writing Narrowing down the focus of your brand is easy when you have a brand philosophy. Click here for 10 Brand Philosophy Examples to Align Your Company Culture.”

For example, if you are a grocery delivery company, it doesn’t make sense for your business to donate shoes to children. However, it does make sense for your business to donate to local food banks, school nutrition programs, or meals to local homeless shelters.

Focusing on sustainability and social responsibility throughout your organization

Another careful consideration for business owners when running a social impact company is to ensure that your business elements are aligned with your cause or mandate. This means thoroughly researching all third-party organizations associated with your business, including suppliers, delivery companies, retailers, buyers etc. 

A commitment to the social good should extend beyond just your employees and business. 

Those you do business with should be encompassed in that umbrella as well. 

This requires additional research and, sometimes, additional cost s to ensure you are only working with people and organizations that share your values and are conscious of the collective good. This can include things such as:

  • Environmental impact and sustainability
  • Workers rights, compensation and treatment
  • Organizations that do not support harmful social policies or legislation
  • Organizations that have a proven track record of diversity and inclusion

The list could go on and on based on the mandate of your business.

Incorporating this social good into your identity

Once you have developed your social impact cause and integrated it into your business model, it is time to build your brand identity. The power in social impact businesses is the ability to set themselves apart from competitors and similar businesses by being “more than a business.” 

This “more than just a bottom line” approach strongly resonates with many consumers and should be thoughtfully integrated into your brand identity and marketing. 

This is a key distinguishing factor between a social impact business and a business that intermittently does charitable work or donates to causes. A social impact business will ensure the presence of their mission to do good is thoroughly integrated into their branding, mission and who they are as a business.

Examples of Successful Social Impact Companies

To show you the potential of a social impact model, we’ve rounded up our three favourite businesses that make social enterprise and ethical business practices cool.

Ben & Jerry’s
ben and jerry's social impact
Ben and Jerry's don't just encourage social impact, they drive it forward themselves with company polices, inclusive hiring practices, and sustainable production. (https://www.benjerry.com/about-us)

Iconic ice cream company Ben and Jerry’s has a mandate of “grassroots activism and community organizing for social and environmental justice,” according to their public stakeholder statement. The brand has taken a strong stance on environmentalism and sustainability through in-depth research studies and amending its’ production protocols to invest in environmentally friendly processes. 

The company has advocated for eliminating genetically modified organisms (GMOs) from all of their products and hold their dairy farmers and distributors to high ethical standards. 

Ben and Jerry’s have created a niche market for themselves as a quality product that consumers will willingly pay more for in order to support their social impact projects. 

The Ben and Jerry’s corporation is a strong advocate for workers’ rights and pays their workers a livable wage and makes special considerations to hire employees from marginalized populations, including those recently released from prison.

Ten Tree
ten tree social entrepreneurship
As a Canadian clothing and apparel company, Ten Tree has made social entrepreneurship fashionable and wearable. (https://www.tentree.com/)

Ten Tree is a Canadian company that is dedicated to protecting the environment and creating sustainable manufacturing and business practices for their clothing line. 

All their clothes are made from sustainable materials using environmentally responsible manufacturing practices. The brand also commits itself to a number of projects designed to protect the environment. Their famous brand slogan and social impact mission is for “every item you purchase, Ten Tree commits to planting ten trees.”

Me to We
social impact company example
ME to WE is one of the first companies to offer lifestyle products with the objective of empowering social impact. (https://www.metowe.com/)

Although it’s the parent organization, WE Charity has come under controversy in recent months; the Canadian social impact business Me to We has strong roots in the creation of a social enterprise model and is often seen as an example to strive towards for other social impact businesses. 

Me to We is based on the idea that products and services can make a global impact by bringing the social enterprise to everyday consumer choices. All Me to We products are handmade by individuals in countries such as Kenya and Ecuador, and funds are channelled back into these communities. 

Me to We artisan products are certified fair trade and an educational tool to teach buyers about globalization and social enterprise impacts.

While these are some strong examples of organizations that have made social good their mandate from the very beginning, there are several examples of brands who effectively integrate corporate social responsibility into their existing business model, including Adidas, Nike, HelloFresh, WestJet, Disney and PetSmart.

Key Takeaways on Social Impact

Creating a business with a social impact can be a fulfilling and profitable journey. As our examples above have shown, creating a social impact business is a way to integrate the desire for social good into your brand identity and differentiate yourself from competitors or similar companies. 

However, a social impact business does not come without its’ challenges. Business owners are tasked with being ethically and morally responsible for all business elements to a detailed degree, and their reputation is largely staked on their mission to contribute to the collective good. 

No matter your cause, social justice issue or mandate, creating a social impact business is a heightened degree of responsibility and opportunity to go beyond just business.

Vincent Lee

Written By Vincent Lee

The Managing Editor at Advesa, Vincent is a mechanical keyboard enthusiast, a lover of cats, and a purveyor of fine roasted matcha teas. When not writing, he enjoys exercising and biking around his beautiful hometown of Vancouver. He is also a strong supporter of the oxford comma.