The world’s most innovative leaders know that social businesses are more profitable businesses
Consumers around the world, from Vancouver and Toronto to Shanghai and New York, believe that a company’s social role goes beyond simply meeting legal requirements, complying with ethical standards, creating jobs and paying taxes. Research shows that consumers everywhere expect companies to act as social leaders, using their business expertise to lead social change.
Over the next few weeks, I will be writing about how the world’s most innovative companies are using social value strategies not only to address poverty and other social problems, but also to gain competitive business advantages, improve workplace relations and grow profits. These articles will focus on the four core corporate strategies that I explore in more detail in my Social Value Business Guide. Learn why social businesses are more profitable businesses, and how your company can adopt Community Hiring, Living Wage, Social Buying and Social Innovation strategies to become a change agent in the local community and a leader in the global marketplace. Companies that do will be playing their part to accelerate the Global Goals set by the UN.
The global labour market is becoming more competitive, creating a serious challenge for employers seeking to hire the talented and productive workers they need to drive their businesses forward. In an effort to confront this growing challenge, the world’s most innovative companies are adopting social value business strategies aimed at minimizing risk to their workforces and gaining a competitive advantage in the world marketplace.
Whereas traditional businesses perceive poverty and other social issues as extraneous problems unconnected to their day-to-day operations, today’s leading companies adapt their business models to cultivate vibrant and resilient communities, which improves their corporate reputations, reduces supply chain costs, increases revenues and widens profit margins. The savviest companies build social value right into their HR hiring practices. Understanding that long-term financial prosperity depends on sustaining a productive and cohesive workforce, these businesses choose to hire strategically from the distinctive social, economic and cultural groups living in their local communities – an innovative practice that strengthens their corporate profiles and reduces their recruitment and human resource costs.
Local hiring of this kind is changing the way transformational companies support and engage the people who make and purchase their products. These companies realize that local labour markets offer opportunities to hire workers who are motivated to excel in the workplace but who have been excluded from the traditional labour market because of disabilities, lack of experience, language barriers, and other cultural and socio-economic impediments.
Aboriginal people, people living with disabilities, new Canadians, people recovering from addictions and other disadvantaged people seeking to enter or re-enter the workforce can offer transformational companies a competitive advantage in the tightening labour market. The reason for this is simple. People from these groups can exhibit better work performance and a deeper commitment to their jobs and companies than other workers. Human Resources professionals are wise to recruit people from these distinctive social groups.
Research demonstrates that in addition to making a direct contribution to poverty reduction and social inclusion, companies that hire people with employment barriers gain a number of direct business benefits, including lower recruitment costs, reduced staff turnover, enhanced brand reputation and increased productivity.
Creating inclusive workplaces with a diverse workforce enables companies to mirror their communities, better connecting them to the customers who buy their products. Integrating social values with business goals through Community Hiring creates cascading ‘win-win’ opportunities for social value companies and the people living in their communities. While employees benefit from decent jobs and an improved standard of living – advancing economic prosperity and stabilizing the community – the companies that employ these people gain valuable local expertise and insights into new markets, creating innovative ideas that can lead to more inclusive design opportunities.
People’s expectations are changing. The long-held belief that businesses stand apart from their communities, their social role limited to providing jobs and making charitable donations, no longer applies in today’s marketplace. The world’s most innovative and transformational businesses understand that their role in society has evolved. For this reason I encourage Chief People Officers seeking to create and sustain a dynamic labour force to read my Community Hiring Guide, which outlines the steps necessary to design and implement an effective and profitable Community Hiring strategy that benefits both employers and the workers and customers who live in their local communities. You’ll also find several helpful employer’s toolkits and illustrative case studies.
In the coming weeks, I will be writing more articles that examine how transformational companies around the world are creating social and financial value by adopting equitable human resource strategies, implementing community benefit procurement processes and pursuing social innovation strategies. I welcome your insights and comments.
