Corporate social responsibility, more commonly referred to as CSR, has exploded in recent years—and now consumers, employees, and employers are putting their money where their mouths are. If your business needed an excuse to be a good steward, now you have one. Once, businesses could flourish with lowball prices and a killer product—regardless of their morals, materials, or labor. Now, the world's citizens demand more: fairness, equality, environmentally-friendly and ethical labor, economically responsible behaviors, and beyond. What power do consumers have, though? All the control. They decide which companies live, thrive, and die—from a transatlantic student boycott that forced Fruit of the Loom to reopen a factory to millions of consumers supporting a relatively unremarkable (and expensive) TOMS shoe for its mission statement alone. CSR is no longer a nice-to-have brand afterthought. In this era, CSR comes first, profits second. Below, we'll dive into the details of CSR and why your small business should embrace the concept. What Is Corporate Social Responsibility? Corporate social responsibility describes a business's initiatives to improve the world in one way or another. This responsibility ranges from reducing carbon emissions to alleviating poverty in developing countries to being more environmentally friendly. 50 years ago, economist Milton Friedman said "There is one and only one social responsibility of business—to use its resources and engage in activities designed to increase its profits.” However, this idea has evolved in the 21st century. Last year, 181 CEOs endorsed a more up-to-date statement on the purpose of business: "Businesses play a vital role in the economy by creating jobs, fostering innovation, and providing essential goods and services. Businesses make and sell consumer products; manufacture equipment and vehicles; support the national defense; grow and produce food; provide health care; generate and deliver energy; and offer financial, communications and other services that underpin economic growth. While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders." The statement defines stakeholders as customers, employees, suppliers, communities, and shareholders—each of these being equally important. CSR is refocusing the why behind the reason most entrepreneurs started a business: \tTo provide goods and services to customers—ultimately making their lives better, whether that's through a hot dog, haircut, or yoga session \tTo pursue a passion, not just the accumulation of wealth \tTo make a difference by creating a new path rather than following in the footsteps of others \tTo make the world a better place While these aren't the only reasons you started your small business, they're likely significant influences on what keeps you hustling day after day. The Benefits of Corporate Social Responsibility Making the world a better place and improving lives are reasons enough for most to prioritize CSR, but there's a host of other benefits, too: Gain and Retain Customers An Edelman study found that 64% of consumers will "choose, switch, avoid, or boycott a brand based on its stand on societal issues." Another study found that 89% of consumers are likely to switch to a brand associated with a good cause. If you want to acquire and keep loyal customers, you're going to need to deliver more than just a top-notch product—you're going to need to do some good as well. Bump Up Your Prices Why do TOMS shoes sell for upwards of $50? It's not for the inexpensive canvas and minimalist outsole—it's because 66% of consumers are willing to pay a premium for more sustainable goods. Doing good and giving back doesn't come cheap, but most of your consumers will compensate for your good intentions by paying more for your products. Boost Your Bottom Line Not every CSR initiative will get recognized in the newspaper or garner customer loyalty—and that's okay. Some sustainability practices will boost your bottom line even if no one ever notices. Converting to energy-efficient appliances and LED light bulbs will require an initial investment, but you'll reap the financial rewards down the road. Attract Top Talent A study found that nearly 50% of respondents from this Fast Company study would take a pay cut to work for an environmentally responsible company. Almost 70% of respondents said a strong sustainability plan would affect their decision to stay with a business long term—and 30% said they'd left a job due to the company's lack of a sustainability plan. The best employees want to work for morally and environmentally responsible businesses. If that's not you, they'll move on. Now, More Than Ever, Is the Time to Embrace CSR " COVID-19 pandemic has laid bare the profound interconnectedness between businesses and the broader world in which they operate…Employees, customers, and stakeholders expect a CEO to articulate where the company stands on critical issues," says Kevin Sneader and his McKinsey Quarterly co-authors on the role of CEOs in this unprecedented moment. Don't wait until next year to embrace CSR. Your business, employees, customers, and community are all connected: the decisions you make at work affect everything and everyone around you. The world needs empathetic decision-makers and influencers right now, and you (no matter how small your business is) are in that position of power. The debate about the right business to start and how to grow your company will always rage on, but one thing remains certain: committing to a more socially responsible business will never be wrong. Not yesterday, not today, and definitely not tomorrow. Start Making a Real Difference Businesses rise and fall, but the impact they make on the world lasts forever. What legacy will your business leave? Will it be one of sustainability and equality, or will it solely be one of profits and wealth? The decision is yours. What do you want to be remembered for? Fortunately, CSR has clear financial and business benefits, so you don't have to play tug-of-war between profitability and moral integrity—the two are growing more hand-in-hand every day. If you make CSR your business's top priority, you'll rise or fall with zero regrets.