Corporate Social Responsibility in
Small and Medium Enterprises

Corporate Responsibility in SMEs is expressed in various practical actions
that are not necessarily difficult to implement or are too costly

Small and medium companies are often distinguished with high social responsibility. However, they are unaware how to convert the potential of responsibility into benefits for their businesses.

Corporate Social Responsibility in the SME Sector: Best Practices, Ministry of Employment and Economy of Finland, Centre for responsible business at the Turku school of Economics, 2009

Why is CSR relevant for small companies?

People often ask, whether corporate responsibility is only for large businesses, or if that could be important for small companies as well. Why small and medium companies with much smaller human and financial resources than large enterprises should assume more responsibilities? In fact, many small and medium businesses have naturally been implementing CSR initiatives throughout the years, though without referring to them as CSR and without properly communicating such activities.  

„In response to a survey conducted in UK in 2015, a half of the participating small enterprises stated they did not have CSR programs. However, it turned out that, in fact, they carried out many CSR related initiatives“.

Small and medium enterprises may not be aware of or be using the term “corporate responsibility”, but their relationship with employees, suppliers, partners and the community might be in compliance with high responsibility standards. For this size enterprises this process is more intuitive.

Correct planning and communication of corporate responsibility activities can help small and medium businesses to be distinguished from their peers, establish partnerships with foreign/global companies, attract investments and raise their local reputation. Therefore, it is important to bring positive outcomes of CSR and the ways of its implementation to the attention of small and medium size companies.


“Implementation of corporate responsibility is not an extremely difficult and highly costly task. Stage by stage adoption of social responsibility approaches, their gradual development and coordination with business interests will ultimately open new opportunities for small and medium companies and lead to improved performance”.

”Because many small and medium companies are naturally operating in a responsible way, integration of CSR into their activities does not mean these companies should transform their operations, but rather - they should maximally increase the effectiveness of their existing CSR practices. Thus, social responsibility is not an extra burden for the companies. In fact, it only means to do something you have already been doing in a better way and turn the existing reality into your competitive advantage”. 

Corporate Social Responsibility Toolkit for Small and Medium Companies, Tbilisi, 2018

Implementation of Corporate Social Responsibility in SMEs

Usually, social responsibility programs of small and medium enterprises cover one or more of the below listed areas:

  • Work conditions and employee relations;
  • Local community relations;
  • Marketplace: customers, suppliers, goods and services;
  • Environment protection.

It is not necessary for a company to spend similar efforts on each of the above-mentioned areas at a time. Prioritizing the issues and concentrating on the most relevant ones would be much more effective. After having the first success, it is always possible to add other new activities. 

Responsibility is expressed in various practical actions that are not necessarily difficult to implement or
are too costly.

If this is your first time dealing with a social responsibility issue, it is better to start from a smaller scale activity and draw your attention to such initiative that is in direct relation with your business operations, and which, you think, you are able to accomplish.

Later on, you can gradually expand the area of your responsible actions and make them more comprehensive and systematic. This is how most small and medium companies do – they do not stop at only one direction and prefer to adopt wider approaches. Thus, responsibility turns into an inseparable part of their business concept and activities.

Corporate social responsibility program will be successful, when:
  • It is in line with the company values and its main business activity;
  • It is supported and lead by the company management;
  • The company’s employees are involved with their ideas, creativeness and direct participation;
  • It is systematic and uninterrupted, is based on the company’s strengths and is aimed at gradual elimination of its weaknesses and drawbacks. 

Main Stages of CSR Cycle in Small and Medium Companies

Recall and discuss all those CSR initiatives that have already been implemented in your company; also discuss the company’s ethical values and principles, determine the issues that you plan to address and identify your strengths. 

First of all, simply identify your main stakeholders - think of all those groups or individuals that your business affects, or that affect your business success. All these groups and individuals are your “Stakeholders”. Discuss your company’s social responsibility with your stakeholders: what are their expectations? What type of cooperation is possible with them? 

Once you have assessed your business activity and identified those responsible initiatives and approaches you have turned out to be doing for quite a while, though without referring to them as CSR, and have established relations with your stakeholders, you need to decide what you would like to do – this will greatly depend on the type of your company’s activity. 

Think about following: what issues are important to you, as a responsible entrepreneur, and to your company? What do your employees, customers or your community members expect from you? Identify the areas to focus on and plan specific actions. 

Planning CSR activities should not be a complicated process. Start with selecting one or two areas you will focus on and make a simple objective that will be the most realistic for you to achieve. 

List CSR initiatives you will implement and continue working in the direction that will prove to be the most successful in the coming years as well. Your CSR strategy will gradually emerge from those priorities and respective actions.  

Measure the outcomes of your responsible activities and think of what you can improve. Periodic assessment of the outcomes will enable the company to timely identify new challenges and possibilities and react to them appropriately. 

Correct communication of corporate social responsibility initiatives and their outcomes is one of the basis for the company’s success. 

Disseminate information on the development of your corporate responsibility and your accomplishments. Let your employees, community, customers, and suppliers know that your company is a leader in social and environmental areas. This will raise trust towards you and improve your reputation. 

Each year, acknowledge your company’s CSR accomplishments and share useful experience with employees. Along with ensuring continuation of the process, this will also help raise your motivation and that of your employees.

Useful CSR Resources for
Small and Medium Companies

Best Practices