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What does it mean to be a socially responsible business?

Socially responsible businesses are businesses that take into account the financial, environmental and social impacts of decisions and actions [they are] involved in. A business whose practices lead to great environmental destruction or social inequity would not be seen as being socially responsible. And in an era where consumers are caring more about the consequences of their buying decisions it’s important for businesses to be good ‘citizens’ – to not take too much from and to give back to society.

socially responsible business

Characteristics of a Socially Responsible Business

Hoodwinking the consumer doesn’t work anymore ~ Daniel Baylis, Fast Company

So what does a socially responsible business look like? What do they do to earn this title? Daniel Baylis’s list on Fast Company is a good one. Let me paraphrase it:

1. Tell the Truth

Baylis writes: “Tell the truth. And if the truth is not pretty, tell it anyway…” Not telling the truth can easily turn into a PR disaster. Information is so readily available, so it will only be so long before the truth is uncovered by somebody else if you’re not willing to be transparent. The good, socially responsible ‘corporate citizen’ has nothing to hide and, in fact, uses their transparency as a point of difference.

Take a look at outdoor clothing company Patagonia for example – they take transparency to a whole new level.

Celebrate and be open about being good.

2. Identify Shared Values With Your Customer and the Community

This plays to the ‘social’ aspect of social responsibility. Be a good neighbour. Give back to the place that you inhabit. Don’t take too much. Understand and embrace mutual dependency.

Baylis shares a tagline from Canadian bank, Vancity: “When we make an impact on our community, it comes back to our members’ prosperity”. Vancity understands that it doesn’t operate in a vacuum.

3. Know Your Impact on the World

A socially responsible company understands the impacts it has on the environment it participates in. Take a company that makes widgets. Some of the components in the widget come from the mines of Namibia, say. A socially responsible company will understand the impact of its widgets on the people of Namibia and the broader world. Are the raw materials coming from where the supplier says they are coming from? Are the workers being paid fairly? Are the workers ensured a safe working environment? What are the impacts of the mine on the natural environment? What happens to the widget at the end of its lifecycle?

Then there are the positive impacts. What additional good can the product do? Here at Kindred Mentoring we will be donating 15% of pre-tax profits to Kiva. This money will go on and help grow businesses in the developing world.

Patagonia: Taking Social Responsibility to a Whole New Level

patagonia socially responsible

Patagonia, a high-end outdoor clothing brand, embraces the idea of being transparent to its customers. Through its The Footprint Chronicles initiative, consumers can view on a world map exactly where Patagonia source their raw materials, textiles are milled, and the end product is manufactured. And they go further by encouraging consumers not to buy their products at all. Their astonishingly upfront advertising copy reads:

The environmental cost of everything we make is astonishing. Consider the R2 Jacket… one of our best sellers. To make it required 135 liters of water, enough to meet the daily needs (three glasses a day) of 45 people. Its journey from its origin as 60% recycled polyester to our Reno warehouse generated nearly 20 pounds of carbon dioxide…


It goes on:

There is much to be done and plenty for us all to do. Don’t buy what you don’t need. Think twice before you buy anything” and lists the 4Rs – Reduce, Repair, Reuse, and Recycle. Clever publicity, indeed.

However, as Tim Nudd from AdWeek writes, “It comes off as a genuine attempt to get people to start thinking about sustainable consumption. It acknowledges the hypocrisy of trying to lead such an effort while also hurting the planet…” The sincerity of this campaign is in the fact that sales would have undoubtedly taken a hit. And Patagonia was ok with that.

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