How can companies utilise their power to create sustainable changes?
Many companies still view corporate social responsibility as a matter of providing funds and resources. However, providing resources does not necessarily resolve the issues in question long term.
Utilising the social norms:
In their book “Nudge”, Richard H. Thaler and Cass R. Sunstein explain that people are more likely to change their behaviour in order to match the behaviour of those around them (a.k.a. conform to “social norms”). Therefore, setting up operations that create new “social norms” can have a much greater impact than simply providing the necessary resources.
Nudging in action:
I recently met a businessman who has set up a company in a small, crime infested town. His vision was to arm the local community with tools to make a living without turning to crime. However, while the creation of jobs has improved the community, the greatest positive impact arose out of the fact that the local youth began conforming to alternative crime-free social “norms”. Unlike previous generations that grew up idolising the local gangs, they began admiring the success of the local workers. Imagine how differently this scenario could have turned out, if the businessman simply provided the tools for the trade, without overseeing the operation and incentivising the locals to adjust their behaviour?
Through understanding the principles of behavioural economics, companies have the power to make long term positive shifts in our society, rather than constantly paying for short term “socially responsible” quick fixes. Even for companies that view it as a marketing exercise, what could be more powerful than brands that improve the society through shifting behaviour?
Written by:
Lana Bruskina – Strategy and Insight Manager
For further information on THINK Global Research, please contact Kristy Ihle (Managing Director) at info@thinkglobalresearch.com.
