Social Impact and It’s Value for Your Business Par :Alana Walker and Stephanie Wilson January 26, 2024 Estimated reading time: 5 minutes. A business's primary concern is its bottom line. To function effectively, pay employees fairly and with good benefits, and continue to offer services, it's only natural that a company needs to make a profit. However, the best companies do so with a social conscience. Whether hopping into the social sphere once financially stable or putting social issues at the heart of their business models, these businesses seek to have a measurable effect on society, from employee health to community building. What is social impact for businesses? The concept of social impact in the business world is the idea that companies have a social responsibility to contribute positively to society and the global community and not just make money. It emphasizes the effects of a business's activities on various stakeholders and the broader community. Luckily, we have an in-house expert on the subject, Stephanie Wilson. We asked her the essential questions business owners need to know when starting or growing a social impact initiative. What is an example of a social impact in business? 1. Stakeholder well-being. Not just investors, taking care of stakeholders means looking after employees' needs, too. 2. Environmental sustainability. Donations to environmental organizations? Good. Refining company practices and functions with respect to the environment? Great. 3. Philanthropy and charitable giving. This is obvious, but when we say philanthropy, we don't just mean donating money for a sizable tax break. Charitable giving needs to be done in a spirit of authenticity and with a good reason behind why your business encourages a particular organization. 4. Innovation for social good. We're big fans of this one. Some businesses may invest in building tools or fighting unjust systems to help the greater good. Others can partner with organizations and governments to think of creative ways to invest in the community. How can businesses implement social impact? When it comes to implementing a social impact problem, Wilson, with her 15 years of experience in the field, lays out five key hallmarks of a successful social impact program and what businesses should aim for when setting up a program. Alignment with Core Business Values and Objectives The program should align with the company's mission, values, and strategic objectives, ensuring authenticity and long-term commitment. If you're a mobile fitness tracking app, partnering with community organizations encouraging people to get outside could be a good step. You could also donate sports equipment to kids in defavourized neighbourhoods. A financial planning company might find a way to teach financial literacy to students, single parents, etc. Stakeholder Engagement Involving the community in the development and execution of the program fosters greater engagement and impact. This could mean partnering with organizations that do on-the-ground work and know the needs of the terrain. Another example would be surveying investors to see what they would like your company to do. Clear Goals and Objectives Setting specific goals helps in guiding the program and assessing its effectiveness. What do you want to accomplish in 6 weeks? 6 months? A year? How much impact can you expect with the resources you currently have? Partnerships and Collaboration (similar to stakeholder engagement) Collaborating with nonprofits, community organizations, governments, post-secondary institutions, and other businesses amplifies the impact and brings additional expertise and resources. Transparency and Accountability Regularly reporting the program's progress and outcomes to stakeholders builds trust and credibility. This can be done through press releases, newsletters, and radio or television. Explore how Lighthouse Labs' corporate training programs can enhance your company's social impact. How do you integrate social impact as a core part of business? For this one, we went straight to Wilson. Establish Key Performance Indicators (KPIs) Identify metrics that align with the initiative's goals, such as the number of people helped, benefits, outcomes, and impact on individuals, communities, or employers. Use of impact assessment tools Tools like Logic Models quantify the social and economic value created by the program. Regular monitoring and evaluation Continuously track progress against KPIs and adjust strategies as needed. Stakeholder feedback Gather feedback from beneficiaries and other stakeholders to gauge the program's effectiveness and impact. You may have seen… Some popular social impact initiatives of major companies are LEGO partnering with the World Wildlife Fund (WWF) to use more sustainable materials in their toys, the New York Times has funded various GoFundMe campaigns, and Patagonia who use recycled plastics in their fleeces and has donated over $100 million to grassroots environmental organizations since 1985. Discover Lighthouse Labs' innovative approaches to integrating social impact in business. Contact us for more details. Challenges Including any sort of new program in your business will come with challenges. Some are unforeseeable and you'll need to put on your best innovative-solutions-hat to solve them. For the rest, Wilson shares some of the most common difficulties and how to overcome them. Aligning business and social goals You can't ignore the bottom line and want to avoid an initiative putting you over the edge. Overcome this challenge by integrating social objectives into the business strategy and making them part of the company culture. Difficulty measuring impact Address this by establishing clear metrics and utilizing robust data collection and analysis methods. Ensuring sustainability Ensure long-term funding and resource allocation, and design programs that can become self-sustaining over time. Keep tabs on budgets and design the corporate strategy so that the program makes its own money. Engaging stakeholders Overcome apathy or resistance by actively involving stakeholders in planning and decision-making. Ask employees what they think or investors what issues they have at heart and how they'd like to contribute. Scalability Start with pilot programs to test and refine the model before scaling up. The benefits of social impact on businesses Engaging in social impact goes beyond having a positive bottom line. Initiatives that better the world can help build customer trust, employee engagement, and brand reputation. When consumers see companies with a solid social impact strategy, they are more likely to support your business as they may share your company's demonstrated values. You attract more talent to your company as you build a positive brand image, especially when showing that you prioritize current employees' needs. As for Lighthouse Labs, Wilson shares how the company has impacted the larger community. "Social impact initiatives have been at the centre of Lighthouse Labs since the beginning. Four years ago, a separate department was created to expand these initiatives and establish them as a priority for the organization. Through this department, Lighthouse Labs collaborates with employers, industry associations and nonprofits to ensure equitable access to skills training, wrap-around support and employment for all. Lighthouse Labs has developed a holistic partnership delivery model to help ensure the success of barrier-facing individuals throughout their training and (re-)entry into the workforce. Our proven ability to deliver workforce development projects has provided 3,000+ individuals, notably those from under-represented groups and marginalized communities, with the training, mentorship, career preparation and hands-on experience required to secure sustainable careers across a range of sectors. We currently lead our partners on 17 impact initiatives across Canada ranging in size and scope of up to $22M." Wilson shares that last year alone, Lighthouse Labs worked with 400 community organizations across Canada to directly benefit communities nationwide, teaching soft and technical skills training. All in all, wandering into the world of social impact can seem intimidating, but it is well worth it. Having a long-term vision with measurable outcomes and scalability will poise your business for success. Join Lighthouse Labs in making a difference – learn about our partnership opportunities for social impact initiatives.