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Corporate social responsibility (CSR) has grown to be one of the standard business practices of this day and age. Despite its presence in academic literature for more than 50 years, there is still a lot of ambiguity regarding its definition. At its broadest, CSR is concerned with what is – or should be – the relationship between businesses, individual citizens, and national governments. More locally, it is defined as the relationship between a business and the local society in which it is based. A corporation being viewed as part of society is not a new concept.
With suppliers, employees, customers – and, indeed society more broadly – placing greater importance on CSR, many executives have started viewing this as a creative opportunity to fundamentally strengthen their company while also playing a vital role in society. As Marc Spizzirri will tell you, purpose-driven businesses boast greater development. It is evident that this is an opportunity the supermarkets in the UK recognize, as the so-called ‘big four’ - Asda, Tesco, Morrisons, and Sainsbury’s – post yearly CRS reports. As it is now widely accepted that being ‘good’ is sound business, we aim to quantify how accurate this is by assessing how much of an impact CSR truly has on business performance at Asda, Tesco, Morrisons, and Sainsbury’s. This is something that companies in the U.S. can use as inspiration for their own CSR approach.
In recent years, the supermarket sector in the United Kingdom has become increasingly competitive. The industry is also the largest private sector employer in Britain. Key statistics also give an indication of the impact supermarkets have on society. For example, it is reported that supermarkets throw away a combined 300,000 tonnes of food waste per annum. The International Institute of Environment and Development (IIED) also warned that farming incomes in the UK are at the lowest they have been for 60 years. This is widely attributed to the fact that supermarket domination has led to a disregard for the need of farmers. Others also accuse supermarkets of creating unnecessary carbon emissions through sourcing most of their products abroad.
In an attempt to combat the negative criticism, supermarkets are taking active steps to be more socially responsible. Developing CSR strategies has become vital for large corporations like Tesco, Morrisons, Asda, and Sainsbury’s, as the general public is becoming increasingly concerned over their activities. All four supermarkets now publish CSR reports, which outline their extensive efforts to have a positive impact on society. In their most recent report, Morrison’s covered their efforts to reduce carbon footprint, prevent waste, source responsibly, satisfy all stakeholders, and operate with integrity with regards to their supply chain, as well as being neighborly, helping to encourage a better standard of living, and being an employer of choice.
But how do these efforts impact their bottom-line? Do they have a negative or positive effect on profits? We can see that businesses that are purpose-driven are significantly more profitable, and their staff retention levels are higher too.
