Can you describe how socially responsible your business is (in comparison to others)? Could you define your level of social responsibility?
Most likely not.
Why? You probably don't have a reference point or know any social responsibility levels.
In this article, I introduce a historical classification for Corporate Social Responsibility levels to provide historical context. Then I propose a new way to consider your Small Business Social Responsibility level as defined within my Small Actions Framework (SAF).
Pyramid of Corporate Social Responsibility
If you search for “level of social responsibility” online, most results will direct you to a paper published by Archie Carroll in 1991, “Pyramid of Corporate Social Responsibility.” It's one of my favorite historical concepts or theories for Corporate Social Responsibility that established a pyramid of four precise levels of responsibility for corporations wanting to be good global citizens.
- Level 1 – Economic Responsibilities = Be profitable. The foundation upon which all others rest.
- Level 2 – Legal Responsibilities = Obey the law. Law is society's codification of right and wrong. Play by the rules of the game.
- Level 3 – Ethical Responsibilities = Be ethical. Obligation to do what is right, just, and fair. Avoid harm.
- Level 4 – Philanthropic Responsibilities = Be a good corporate citizen. Contribute resources to the community; improve quality of life.
This categorization puts the need for a business to be profitable FIRST and then adds increasing levels of responsibilities. These are often also referred to as types of social responsibility.
Carroll's second and third levels are now standard expectations for businesses. People simply expect companies to be legal and ethical. However, most of the activities people refer to now within “Corporate Social Responsibility” activities fall only into Level 4.
Levels of Small Business Social Responsibility
In previous blogs, I've talked about how the general principles and intention of Corporate Social Responsibility apply to Small Businesses. However, I also said I don't believe that the APPROACH to Corporate Social Responsibility is the best for small businesses.
Small Business Owners rarely have the resources, or the need, to implement large programs. Therefore, I created the Small Actions Framework (SAF) to provide an alternative and more manageable approach for Small Business Owners.
As part of the SAF, I also created four Small Business Social Responsibility levels based on a Small Business Owner's interest, awareness, and activity regarding social responsibility.
The SAF, and the four levels, were designed to be flexible and scalable to best fit the needs and resources of each small business. Each level has slightly different guidelines and tools to help implement social responsibility efforts.
Level 1 – Passive Small Business Social Responsibility
Level 1 of the SAF is “Passive Social Business Social Responsibility.” At this level, a Small Business Owner may be doing social good already. However, they are unfamiliar with the concept and how they can make it easier and more effective, or they are intentionally not sharing their efforts because of limiting beliefs.
At the very least, Small Actions Greater Good aims to move every business from Level 1 (Passive) to Level 2 (Reactive). The transition point from Level 1 to Level 2 happens when a Small Business Owner becomes more aware of social responsibility and accepts that it's OK to benefit from doing good.
Level 2 – Reactive Small Business Social Responsibility
Level 2 of the SAF is “Reactive Small Business Social Responsibility.” At this level, a Small Business Owner is aware of social responsibility, understands and accepts how it could benefit their business, and is interested in doing good. However, they don't have the time or resources to plan specific efforts.
The goal of businesses in Level 2 is to embrace a Social Responsibility Mindset and try to incorporate social responsibility into their business decisions whenever presented with an opportunity.
For example, the owner of a Reactive Business may be ordering new supplies for the office. While keeping social responsibility in mind, they select recycled paper instead of non-recycled paper. For Level 2 it's about making socially responsible choices when or if an opportunity arises. The choices are made primarily in reaction to other business decisions; they are not planned in advance.
The transition point from Level 2 to Level 3 happens when a Small Business Owner commits to and has the resources to plan social responsibility actions in advance. The efforts do not need to be a lot – it's simply a choice to plan instead of reacting.
Level 3 – Intentional Small Business Social Responsibility
Level 3 of the SAF is “Intentional Small Business Social Responsibility.” At this level, a Small Business Owner is aware of Social Responsibility, understands and accepts how it could benefit their business, is interested in doing good, AND has the resources and desire to plan the efforts.
Planning ensures that the efforts are as efficient as possible and produce the most benefits to the business.
The goal of businesses in Level 3 is to do as much effective social good as their time and resources allow through consistent planning.
The transition point from Level 3 to Level 4 happens when a Small Business Owner makes a more significant commitment to incorporate social responsibility as an integral component of their business and commits to developing a strategic approach.
Level 4 – Strategic Small Business Social Responsibility
Level 4 of the SAF is “Strategic Small Business Social Responsibility.” At this level, a Small Business Owner has fully embraced social responsibility and wants to incorporate it as an ongoing, routine, and integral part of their business. At this level, social responsibility becomes a strategic component within the business, and efforts typically occur at a programmatic level (i.e., multiple projects occurring in coordination with a larger purpose).
The goal of businesses in Level 4 is to do as much effective social good as possible that is intimately connected to the purpose and mission of their business and woven into their overall strategic planning process.
There are two categories of Strategic Social Responsibility:
- Holistic Strategic Approach – A business focuses on improving its social responsibility efforts across all four categories (1 – Business Integrity, 2 – Health, Safety, and Wellness, 3 – Environmental Impact, and 4 – Community Engagement)
- Cornerstone Strategic Approach – A business focuses on actions that specifically connect to its mission, purpose, or values.
Businesses often oscillate between Level 2 and Level 3 as their resources permit. However, once a business moves to Level 4, they rarely drop back down to Level 2 or 3 because the commitment to social responsibility becomes a woven part of their business.
What Level of Social Responsibility Applies to Your Business?
Based on the descriptions here, what level are you?
If you don't know the answer for sure, or you think you know your level and you want to learn more but aren't sure where to start, I have you covered.
You can take a quick free assessment that will determine your level of social responsibility AND give you recommendations on what you may want to do next.
Start the Free Social Responsibility Assessment
About This Content
This article is part 8 of an 8-part series that introduces foundational concepts about Small Business Social Responsibility, Small Actions Greater Good, and the Small Actions Framework. Links to these articles are provided below.
- What is Small Business Social Responsibility?
- What is the Small Actions Framework? (A Unique Social Responsibility Approach for Small Businesses)
- How Can You Do Good as a Small Business? (Categories of Social Responsibility)
- Why Should Businesses Be Socially Responsible? (Or More Specifically Small Businesses)
- What Are the Potential Benefits of Social Responsibility?
- What’s Holding You Back? (Social Responsibility in Small Business)
- Doing Good is Good Business (IF You Do It Effectively)
- (This Article) Levels of Social Responsibility (How Socially Responsible is Your Small Business?)
As an alternative to reading each of the blogs separately, you sign up for a free 8-part email series, An Introduction to Social Responsibility for Small Business Owners, which includes most of the content from these 8 blogs.