What Makes a Company Socially Responsible?
By Daniel/ March 18, 2021
Socially responsible investing (SRI) is a rising idea among newer generations of investors. The motivator behind these actions is dual edged: they don’t only want to see financial returns; they’re interested in a company generating social and environmental returns as well. The process of social responsibility is complex despite revolving around the simple premise of ‘doing good’ in the world instead of solely netting profits. Being socially responsible at the company level is complicated because it is an ideal that needs to be integrated into every level of the business’ operations to actually have a noticeable impact. That can become especially difficult when considering cost-cutting alternatives: they can save time and money, but often come at the cost of being more wasteful and less eco-friendly. To get a better idea of how social responsibility is handled throughout different companies, this piece will focus on the efforts of the New Belgium Brewing Company and how they approach integrating socially and environmentally positive ideas into their day-to-day operations. If you’re interested in learning about what socially responsible investing is in greater detail, click here [can insert longer article link here] and be redirected to a page dedicated to the discussion of the ins and outs of SRI.
What is the New Belgium Brewing Company?
As the name suggests, the New Belgium Brewing Company (NBBC) is a beer brewing company that whose headquarters is located in Fort Colins, Colorado. They aren’t just another brewery though – along with making an assortment of carefully crafted beers, their claim to national and global fame comes through their commitment to leading a sustainable business. The mission as posted on their website is that they, “Believe business should be a force for good. That’s why we push forward solutions to the biggest social and environmental challenges of our time.” Researching companies and figuring out what their true goals are is a key part of being a socially responsible investor. There are some occasions where the message won’t quite match up with their mission statements. Digging deeper is the best way to ensure a company is genuine rather than simply trying to perform well in certain demographics. This is why New Belgium is being used as an example. Not only do they report to hold themselves under scrutiny, but they are constantly observed by the media and external forces which helps keep their actions in check.
What Social/Environmentally Sustainable Strategies to they Employ?
On the social end, they are largely personally invested in maintaining an equal, diverse staff at all times. Per the goals of Kim Jordan, the founder of New Belgium Brewing and a former social worker, there are extensive audits that take place concerning the hiring process, marketplace and media platforms. Additionally, the company itself has established a Justice, Equity, Diversity, and Inclusion training programs to educate and inform employees to the best of their abilities. They also frequently promote policy in regard to creating wealth equality, being an ally of the LGBTQ+ community, and other social welfare programs. On the environmental side, NBBC participates in several climate mitigation efforts. They have invested heavily into recycling, energy efficiency, and water management & efficiency. This has led to New Belgium to brew the first carbon-neutral beer, their Fat Tire Amber Ale. At this rate, they are currently on track to be a fully carbon-neutral business by 2030. This was achieved by installing onsite renewable energy sources through a small PV array and hopes to further invest in wind power.
How does this Benefit Them? Are there any Challenges?
The benefits for operating in this manner are generally financial, but they have led to a ripple effect on the brewing industry altogether. As it turns out, investing in onsite renewables, recycling efforts, and water/energy efficiency is an achievable goal and favorable for bottom lines for almost any company. New Belgium’s ‘experimental’ approach proved that social and environmental investments will not only generate financial returns, but social ones as well. Forging bonds with fellow humans and the environment are, unsurprisingly, great for brand recognition. The primary challenge regarding this approach is certainly the upfront cost for such initiatives. Smaller companies can easily implement some of these ideas at the beginning, though it is hard to be thorough. Some alternatives, like using plastics and cutting corners on production, are certainly cheaper. Fortunately, companies like New Belgium have recognized that the social and environmental costs of cutting these corners in the present will ultimately be much greater than the initial investment.