Corporate Social Responsibility to increase your bottom line. For a business to be sustained long-term (corporate social responsibility), a company needs to replace a single-financial bottom line with a more balanced triple-bottom line encompassing economic, social and environmental objectives into its business practices (also referred to as “people, planet, profit”). The corporate social responsibility approach outlines key areas of focus and guidance for its implementation which ultimately seek to achieve these three objectives.
A global study examining the relationship between corporate social responsibility and company stock valuation across three regions of the world over a 10 year period revealed that socially responsible firms in the United States, Europe and Asia outperformed their long-term financial performance expectations.
A meta-analysis of 52 studies yielding a total sample size of 33,878 observations suggested that corporate virtue in the form of social responsibility and, to a lesser extent, environmental responsibility is likely to pay off. The analysis found that corporate social performance and financial performance are generally positively related across a wide variety of industry and study contexts. It also confirmed that social performance helps firms to build a positive reputation and goodwill with their external stakeholders.
Read full paper here (United Nation).