Grow Your Business by Growing Your Social License

 

Kids smilingSocial investments should be part of how a business operates to help society that enables it to make money

The Internet has put power back into the hands of consumers. With the advent of user-driven sites such as Facebook, YouTube and Twitter; people have learned that they can mobilize easily and quickly to advanced their interests.

Companies must learn to thrive within this shift in power. People can easily google a company’s social reputation and they can vote with their wallets. A dozen people opting to buy a competitor’s greener products is only going to get the middle finger treatment from big business. But when that same group of people starts connecting with similar-minded netizens through Twitter and Facebook, companies are forced to play nice. With Facebook, Twitter and blog sites, people are now the reporter, editor and publisher, in other words they are the judge, jury and executioner.

So what will people find when they look up your company’s social reputation? Here’s a tip, they won’t be going to your corporate website. That’s the last place they’ll go or believe. People will be checking the news, chat rooms, non-profit web sites, groups and their friends in social networking sites to find out what people are saying about your company.

Companies need their social license to continue to operate in the community where they do business. It allows them to enjoy the support of neighbors, goodwill towards employees and patronage of products. This is especially true in markets with various players and people have many options to choose from. Companies with a solid and long history of social responsibility tend to emerge from crises with barely a slap in the wrist, especially in the Philippines where people either have short memories, very forgiving or too busy surviving.

Social investments should be part of a company’s value and culture.  The marketing manager is appreciated at charity events but when the CEO makes it a point to talk to their host community, it signals to each employee that the company is taking social investments seriously at the highest levels.  Participation in social projects needs to be part of the employee evaluation. Management should lead by example. Workers’ morale soars when they understand that work contributes to the greater good.

Dole outs or one-time donations don’t cut it anymore. True social investments are sustainable and create long-term benefits. Unless you want to get stuck doing the same thing over and over again, the community should be able to continue the project when the company moves on to other areas. Social equity increases when members of the community, after training from project managers, are able to adopt the project and lift their quality of life as a result.

ROI from social investments need not only be misty slow-motion videos viewed by teary-eyed shareholders. Social investment can contribute to the bottom line. It can boost a company’s profitability.  Some companies are making social investments part of their operational excellence. Energy efficiency solutions that help lower power consumption and carbon emissions are now one of the key performance indicators (KPIs) of companies serious in helping the environment while keeping shareholders smiling.

Lately, there has been pressure on local companies to use recyclable materials for their packaging. Major fast food chains and big retailers are switching to recycled papers products or cheaper biodegradable plastics. These changes create goodwill from increasingly environment conscious customers and savings for the company.

Sourcing raw materials from the surrounding community helps the company with on-time, on-demand deliveries. They avoid truck bans and traffic in urban areas. Some firms train local farmers plant and grow crops that they will later supply to the companies at fair market prizes.  This helps limit the perennial problems of outsourcing and quality assurance that companies always face.

Other enterprises have formed technical livelihood training for local disadvantaged youths that will create a pool of certified welders, electricians, mechanics and other specialists for absorption into the firms. The employers are assured of quality skills and familiarity with systems having trained these technicians themselves.  They avoid long training cycles and earn appreciation from their host community.

Just like any other permit, Filipinos should make companies renew their social license each year. If companies can make glitzy annual reports to shareholders, why not an annual social investment report to their customers, or at the very least, to their host communities?  People have the right to know how much companies earned and how much was plowed back to society to make people’s lives better. Some communities take enormous risks playing hosts to facilities of big companies that are often stocked with dangerous chemicals, empty their wastes into local bodies of water, and discharge their smokestacks into the same air systems shared by neighbors.

Signs show that companies are becoming more responsible and earning their social license. Thanks to social networks, Filipinos can help speed up and sustain the process. Social networks make it easier to get involved. Filipinos have demonstrated that we are good at banding together to effect social and even political change on EDSA. This time we can do it on the information superhighway.

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