GUEST BLOG: Building a community around your business with CSR

By Sana Khan, commercial contracts attorney at Arista Networks

In part two of a seven-part series Sana Khan explains how companies can provide novel incentives to boost employee loyalty and job satisfaction.

The concept of building a community around a business was quite widespread during the Industrial Revolution, when big corporations in Britain and the US built houses, shops and other amenities around their place of business and provided them to their employees – often at a discount or for free – in return for their relocation and services to their business. Thus, the owners of the large organisations were able to create a sense of community around their main business operations.

For examples look to Port Sunlight near Liverpool, founded by William Lever in 1888 and named after the brand of soap made there, or the town of Pullman on the outskirts of Chicago, founded by railroad car manufacturer George Pullman, in the same decade. The owners of these businesses hoped that by providing a self-sufficient community around their business they would be able to deal with the unrest other cities had with their working class, and essentially built a thriving community with a more satisfied labour force – which helped both the newly established community and the business to grow.

Given the recent global financial crisis, this is something that larger organisations can look into again as many communities have either decreased in population or have lost people to emigration in search of better employment.

One thing to keep in mind in terms of risk management is to ensure that your organisation has clear terms and conditions upon which free or discounted accommodation and other amenities are provided

A large organisation, in theory, has significant pull towards attracting investment back into a community, and one way of using vast, empty housing estates would be to relocate or open a branch in an area that is lacking in employment, population and resources.

This way a business can build its own community of loyal employees by providing them with existing housing at a discount or for free as part of their relocation or remuneration package, and other amenities such as shops and childcare would soon follow. Where there is employment there is money to be spent in a community.

A BETTER FUTURE

There are also commercial benefits such as tax incentives and lower rent for organisations relocating to such places.

It is important to note that this CSR initiative can be used in any country. It could also be used as a method of improving developing and underdeveloped countries’ communities, assisting their governments in keeping qualified and intelligent citizens within their state and preventing a brain dead/brain drain society – i.e. a society in which most of the professional and qualified individuals have migrated elsewhere in search of a better future.

In terms of potential risk implications, as with many of the activities of larger organisations such an initiative brings larger legal and commercial implications. One thing to keep in mind in terms of risk management is to ensure that your organisation has clear terms and conditions upon which free or discounted accommodation and other amenities are provided. This is necessary because you do not want to constantly explain how the process works to potential and current employees.

Further, there needs to be clarity as to what your organisation expects in return for the package offered. It may also limit the expectations that employees might have, as these can quickly get out of hand.

Part one: Thinking about CSR in a new light
Part three: CSR, the environment and your business
Part four: How workplace CSR can help human rights
Part five: Crowdsourcing your CSR ideas
Part six: Bringing technology to places that need it most
Part seven: CSR, entrepreneurship and medical aid