Corporate responsibility - What can you do?

Making money is, and will always be, the number one aim of any business or franchise. However, relentlessly chasing profits to the detriment of society, the environment and others around you is no longer ignored by consumers as, arguably, it once was. Gareth Samuel reports on the increasing importance of conscientious corporate responsibility in 21st Century franchising.

Franchising has a well-documented history with corporate responsibility strategy improvements and misdemeanours. At the turn of the century, fast food franchises specifically came under fire as media allegations linked them to the Western obesity crisis generally. McDonald’s in particular adapted its corporate responsibility programme and began to offer healthier menu options, including a new Deli Sandwich range and salads. McDonald’s now has a comprehensive corporate responsibility strategy that shows awareness of wider issues that affect its customers, irrespective of profit. With policies including 85 per cent recycled packaging for its products and £360 million annual investment into UK agriculture, McDonald’s has developed a positive public image and is as popular now in Britain as ever.

Corporate responsibility is directly linked to public image, which is the difference between success and failure in current UK markets. It is therefore vital to identify gaps in operational procedure that present a business or franchise to the public in a bad light – particularly in the current media-saturated climate. But responsibility is not just about identifying ways to make your business look good in the public eye, it can be the lifeblood of the franchise location too.

For years, Esquires Coffee House took pride in the methodology used to open new locations, through meticulous market research to ensure a new franchise owner would be successful. Managing Director, Peter Kirton, told The Franchise Magazine: “We encourage our franchise owners to become part of the community and to do a lot of social activities in their area. Some of our franchise owners have embraced this more than others, but generally they all understand the Esquires philosophy is to become a social hub for the community.”

Community spirit is an excellent place to start in terms of corporate responsibility, because it is mutually beneficial and will likely lead to long-term success. Esquires is a perfect example of a business dedicated to putting customer happiness and long-term growth first – an operational procedure that has paid dividends for the business.

In franchising, corporate responsibility must be enforced by both the franchisor and the franchise owner alike. Centralised company policies, like TruGreen’s dedication to reducing pesticide use on lawns wherever possible, have to be implemented by the franchise owner too or they are, in effect, empty promises. Franchising is also a perfect platform to implement a range of societal and ecologically friendly corporate measures, as there also exists an opportunity for franchise owners, individually, to bring in new measures. SUBWAY, the world’s largest franchise network, has recently introduced ‘Eco-Restaurants’ to the American market and allows franchise owners to choose the environmental policies they would like to bring in themselves – these include low -flow faucets, energy saving appliances, motion sensor lights, solar panels and more. The franchise has recognised that environmental awareness in modern business is vital for both public image and cost-effectiveness.

The 1980’s was a decade strewn with corporate supremacy and profiteering most ignorant – it was, for many businesses, the glory days.

Now, due to the much-talked-about recession and economic instability, making profit is a great deal harder for most companies and the only way to see long term success is to operate conscientiously. The Internet has transformed almost every living person into a potential whistle-blower through social media. No longer can businesses conveniently bend the truth to suit their own means when pitching to customers, or present figures that are simply unviable when consumers can do their own research from their desktop. This development inevitably means that operating ethically is key to maintaining integrity and therefore success.

Franchises that are thriving and that are likely to be successful in the future are often ones that have sought not to fool the public through menial gestures of agenda-driven goodwill and PR, but ones that have pledged time and money into ethical practices and corporate generosity.

So how do you go about designing and implementing a viable yet effective corporate responsibility strategy? According to Dina Gerdeman of Harvard Business School, a corporate responsibility strategy should have two outcomes – “To create a positive social or moral impact and to enhance a brand’s reputation.” This means evaluating your business and seeing where you can improve in terms of environmental compatibility and customer focus. McDonald’s’ analytical approach to packaging has improved its public image. Esquires community spirit inspires customer loyalty – emulating either of these socially responsible brands is a good place to start for franchises.

Every business has a responsibility to work towards making the world it draws profit from a better place. A comprehensive strategy may cost money in the short-term, but the societal endearment and customer loyalty gained is likely to ensure socially responsible franchises are the future of British business.