Expectations about the role of business in society are changing dramatically. The environmental impact of business is of great importance to many corporate stakeholders. But today, many more purely social concerns are strongly surfacing, and CEOs are paying close attention.
A Bain & Company survey of nearly 300 global CEOs found that 85% of business leaders consider social issues to be an “urgent” concern for their companies. When asked about the primary role of business, 60% said it was either “producing positive outcomes for society” or “balancing the needs of all stakeholders.”
“Companies that are at the forefront of addressing social issues related to diversity, equity, and inclusion (DEI) and practice socially responsible supply chains link social initiatives directly to their business strategy.” We found a way,” said Sarah Minnelli. She is an associate partner at Bain & Company Middle East. “This not only introduces a risk mitigation approach, but also creates new possibilities and creates value for all involved. We recognize that there is a direct correlation between.” One of the most influential stakeholder groups responsible for change is customers. Customers have revealed that they are concerned about the social impact of their brand and product choices. According to Bain research, half of consumers around the world are more likely to buy from a brand that is committed to combating racism, and more than half are more likely to buy from a brand that is committed to human rights. is the answer. By region, 82% of consumers in Europe, the Middle East, and Africa are more likely to recommend a brand after learning that it supports a social cause; 86% say it is very important for businesses to contribute to the betterment of society. In the US, one-third of Gen Z consumers say they will boycott brands with poor labor practices. Executives surveyed by Bain said social performance drives business outcomes in a variety of ways. Executives of companies that are leading on social issues self-assess that their revenue and EBIT growth rates are higher than their peers that lag on social issues. They also perceived their companies to be doing better in attracting customers, talent, and funding.
“When it comes to addressing social issues, the challenge for many executives is understanding exactly how to translate action on these issues into economically sustainable business performance,” said Bain Partner, Global Director Jenny Davis Pecudo said. Practicing sustainability and responsibility. “The ‘S’ in ESG is made up of a wide range of issues and differs from organization to organization. First, he recommends focusing on his four key stakeholder groups: communities, customers, employees, and suppliers, and identifying actions that address social issues for these groups and deliver results for your business. . ”
Bain’s research examines four areas of opportunity to link social action to economically sustainable business performance.
Improving the social and economic conditions of local communities. The communities in which companies operate have become increasingly important stakeholders for businesses. Some companies are looking at these stakeholders through a social lens and finding ways to significantly improve conditions in their communities in ways that improve business performance.
Identify new sources of customer value. Applying a social lens to your customers and markets can reveal opportunities to create value for entirely new customer segments, including underserved markets.
Investing in current and future employees. Given the challenges companies currently face in attracting and retaining the right talent, investing in employee learning and development will help companies move from being “talent acquirers” to “talent acquirers.” You can move on to becoming a creator.
Strengthen supply chain resilience by building relationships with socially responsible suppliers. By examining their supply chains through a social lens, companies can work effectively with suppliers to ensure fair and equitable practices, while increasing end-to-end supply chain resilience. .
Source: Press release, Zawya