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Social impact explained

Social Impact explained
Three volunteers handing out water and food
© RMIT 2023

Before discussing why we think social impact matters, we invite you to reflect on why social impact matters to you and, if relevant, to your organisation.

While the private sector (businesses, humanitarian organisations and sustainable enterprises) contributes to sustainable development by providing goods and services, financing social and economic investments through taxes, and creating innovative solutions to help tackle development challenges, there is increasing recognition that more can be done to provide positive social impact. Social impact means any significant or positive changes that solve (or at least address) sustainability, social injustice and development hurdles. Businesses or organisations achieve these goals through deliberate projects or programmes, through sound governance and through reorienting the DNA of the organisation. It might be a local or global effort to tackle challenges like climate change, water shortages, gender inequity, poverty, unemployment, or any other problem communities are facing.

Incorporating the pursuit of positive social impact into the organsiational mission will better position the organisation for success in both the long and short term. Social inequities, social unrest or environmental degradation can damage the long-term prosperity of the business or organisation, as well as the communities. Organisations that understand this challenge and take impactful action are a step ahead.

Having social impact not only provides the satisfaction of contributing to a more sustainable and just world—it provides a compelling story that connects with employees, customers, investors and the community on a more meaningful level. It allows the organisation to engage with a range of stakeholders about what matters to them. More and more, employees want to work for organisations that are doing good, and there is a great deal of evidence that achieving social impact increases employee morale and commitment. Furthermore, galvanising your power as a organisation to do good may motivate others in the sector. Your leadership can inspire other businesses and organisations to consider how they too can create sustainable solutions to the world’s big problems.

Benefits of social impact for businesses:

Increased brand reputation builds customer loyalty icon Increased brand reputation builds customer loyalty
Increased employee engagement improves morale icon Increased employee engagement improves morale
Positive impact in local communities builds trust icon Positive impact in local communities builds trust
Improved supply chain management promotes sustainability icon Improved supply chain management promotes sustainability
Businesses get to have real and consequential impact icon Businesses get to have real and consequential impact

Now it’s your turn

Why does social impact matter to you? Share your thoughts in the comments.

© RMIT 2023
This article is from the free online

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