not familiar with social impact?

Learn about it below!

WHAT IS
Social Impact?

Social Impact is the practice of incorporating environmental, economic and social governance into a company's business model. CSR can incorporate activities such as employee volunteerism, impact marketing, PR campaigns, philanthropy, and donating products or services.  

WHY DO

Societies today expect companies to engage in social issues the effect their stakeholders,  provide safe, healthy, and enjoyable workplaces for their employees, and help mitigate the effects of climate change.

Corporations have direct impacts on societal norms, the environment and the well-being of their staff. Sustainable social, environmental, and even governmental changes requires involvement from the private sector.

Social Impact?

There are different Social Impact models companies can implement:

Full integration

Some corporations integrate social impact directly into their mission statement. These companies will generally orient their operations and decision-making to be more socially-conscious, such as ensuring their supply chain is as sustainable as possible. One such company that implements this model is Patagonia. Patagonia's missions statement is: "Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis."

Medium integration

Other companies use their products, services, marketing or revenue to give back. Some of these companies will even create a related foundation or nonprofit to support social initiatives. Salesforce has donated over $250 million to education initiatives, and created the Philanthropy Cloud to enable companies and nonprofits to organize their philanthropic and social impact activities. 

Low integration

Philanthropy is considered one of  the earliest models of CSR, in which a company donates its revenue to nonprofit organizations or social campaigns. Currently, many regard philanthropy as separate from CSR, and look for companies to integrate medium or full integration models, with philanthropy as a subset of their social impact initiatives.

nonprofit as a service

Some organizations will even operate as nonprofits, offering products or services with the revenue used to fund social impact programs and the operation itself, and raise awareness for social issues. Humantix, a nonprofit ticketing platform, uses the money earned through booking fees to advance education opportunities for children in Australia.

The Social Impact Glossary

A company's commitment to  improving society through actions such as sustainable operations,  social and economic programs, philanthropy, and volunteering.

Corporate Social Responsibility (CSR) 

A company that integrates social impact into their mission statement and the totality of their organization.

Ex: Patagonia

Social 

Enterprise

A corporate giving model where for every product sold one is donated by the company.

Ex: Toms

Buy 1 Give 1 Model

Corporate Citizenship

A company that integrates social impact into their mission statement and the totality of their organization.

Human Social Responsibility 

Seen as the next era of CSR, HSR places a greater emphasis on a firm's human stakeholders - its employees and the societies it impacts.

Philanthropy

Actions in which a company donates a portion of its revenue to a nonprofit or social cause.

Impact Investing

Investment activities with the goal of creating a measurable positive social, environmental, and financial return.

Corporate Sustainability

A business approach that integrates environmental, social, and economic good practices. 

Build Back Better

First used by the UN to define a program utilizing disasters as an opportunity to create more resilient societies, is now commonly utilized in reference to designing more resilient social impact programs.

SRI

Socially Responsible Investing (SRI) are investment activities that have a positive social impact.

Employee Engagement

The level of connection, passion and loyalty an employee has to a workplace. 

Cause Marketing

Marketing that seeks to produce both profits and social good or awareness of a social issue.

Circular Economy

An economic system that prioritizes the continual utilization of resources and the reduction of waste.

Sustainable Finance

Investments or financial services that integrate environmental, social, and governance criteria to generate both financial returns and a positive social impact

ESG

An acronym that stand for "environmental, social, and governance". These are the 3 criteria that measures the social impact of investments or a company's activities.

Social Entrepreneurship

Designing business concepts that benefit a social cause.

The United Nations Sustainable Development Goals are 17 goals to create a more sustainable future to be met by 2030

SDGs

Matching Programs

Corporate programs where an employer matches donations made by its employees.

A company's commitment to facilitating a workplace with equal opportunities for people with a variety of backgrounds.

Diversity, Equity & Inclusion

Workplace Giving

Corporate programs designed to encourage employees to donate through matching programs or volunteering.

Social Impact Timeline

Bright Gradient
1713

"Sustainability" (nachhaltigkeit in German) was coined for the first time by Hans Carl von Carlowitz (the head of the Royal Mining Office of Saxony) , who formulated ideas for sustainable forestry in reaction to possible timber shortages and its impact on mining. 

1720

Jonathan Swift lends small amounts of money, known as Irish Trade Loans, to poor Irish tradespeople, setting the stage for the modern micro-credit loan.

Bright Gradient
1867

The Peabody Education Fund, established by George Peabody ("the father of modern philanthropy"), considered to be the first modern philanthropic foundation, provided money to advance access to education for impoverished Southerners after the Civil War.

1889

Wealthy businessman and philanthropist Andrew Carnegie published the Gospel of Wealth, encouraging wealthy people to support social causes.

In 1911, Carnegie founded the Carnegie Corporation of New York, funding education programs in the US, and currently, the world

Bright Gradient
1855+

In the late 1800s, John D. Rockefeller, the richest person in modern history became inspired by Carnegie and donated more than half a billion dollars to social issues.

In 1912, John D. Rockefeller Sr, his son John D. Rockefeller Jr, and Fredrick Taylor Gates founded the Rockefeller Foundation with the mission of providing global humanitarian aid.

1907

Margaret Olivia Sage found the Russell Sage Foundation focused on social inequality, immigration, and the labor market.

 

The same year the foundation funded the Pittsburgh Survey, the first systematic sociological examination of urban working conditions in the United States. 

Bright Gradient
1914

The  Cleveland Foundation, the world's first community foundation, is created by banker Fredrick Goff to address social problems in the city of Cleveland, including crime, education, and poverty.

1953

Howard Bowen publishes Social Responsibilities of Businessmen, a book relating the responsibility of corporations to society, and setting the foundation of corporate social responsibility.

 

Bowen is considered the "Father of CSR". 

Bright Gradient
1971

CSR truly began to take hold in the U.S. in the 1970s, when the concept of the “social contract” between business and society was declared by the Committee for Economic Development in 1971.