CSR- Why It Should Be A Part Of Your Restaurant Business

CSR- restaurant business

With an annual growth rate of 7.2%, F&B is one of the fastest-growing service sectors in the world. According to Statista, Global F&B sector generated a revenue of US$65,495 million in the year 2019. Restaurants and F&B brands across the globe are trying their best to make multiple folds of profits each year. Along with making all that money, restaurant business or any profit-making institute for that matter has a Corporate Social Responsibility (CSR) associated with their brand. CSR suggests that ideally, a company should also think about giving back to the society in one or the other way! 

Corporate Social Responsibility refers to the legal actions and operational changes that any business should ideally make to benefit society. There are many ways how a restaurant can serve society by giving a little extra attention to the way they function. For instance, KFC, a quick-service restaurant chain, focuses on waste management, conservation of water and training of their staff to ensure they give back to the environment. There are many other such practices that a restaurant can pick up to play their role in conserving resources or giving awareness to a section of society. 

Why CSR:

Researchers found that globally more than 77 percent of consumers prefer to buy from socially responsible companies. Even in the restaurant sector, consumers are willing to pay 5-10 per cent more because of the brand’s commitment to the community. 

Adding to the study, KT Prasad, Country Sales Director, Zendesk says “Brands in India have long since understood the importance of maintaining a responsible image as a company to sustain in the ever cluttered and competitive marketplace.”

How Companies Are Catering To CSR

Catering to their CSR, KFC tries its best to reduce pollution through their operations. The packaging bags are made of 100% recycled paper; all the napkins and serviettes used are all recycled. Each outlet of the brand has thermostats installed to take care of the Carbon emission. 

Another example of an Indian hospitality brand taking their CSR pretty seriously is the Indian Hotels Company Ltd. (IHCL). Before even CSR spending was made mandatory under the Companies Act, 2013, the brand has been working to serve communities. They support over 60 traditional silk weavers and social impact organizations through the Taj Value Chain. Along with that, the company also supports three heritage sites and enables indirect employment for over 100 artisans in the country. 

Global coffee chains like Starbucks also take CSR pretty seriously. The brand intends to scale up its donation program called FoodShare over the next five years. This targets to around 50 millions meals by 2021. The Coffee chain has been investing extensively on research and quality assurance to develop a method to provide fresh ready to eat food to the needy. 

In addition to feeding the needy, Starbucks also plans to minimize the company’s environmental footprint by using less plastic.

“Our hope is by taking this step, other companies will see the possibility for their participation and together we will make great strides in combating hunger,” says Cliff Burrows, group president, Starbucks, USA. 

Abiding By The Law

Back in 2014, India became the first country in the world to make Corporate Social Responsibility a mandate, through an amendment to the Companies Act, 2013. Since then, it is mandatory for restaurants and other businesses to invest in some of the other social activity. They could invest in education, donate to the needy, raise issues like gender inequality, hunger, and so on. 

According to the amendment, it is now mandatory for companies with a turnover of INR 1000 crores or a market value of INR 500 crores to spend 2 percent of their average profits of last three years on CSR. Before this law, the clause for CSR was only voluntary for companies. 

What you can do to Take Care Of CSR At Your Restaurant 

In a conversation with Rajesh Kumar, restaurant consultant and founder of Gourmet Sage, on how to integrate sustainability in a restaurant business model, he suggests various tips that a restaurateur can pick on. Here are some of them!

  1. Minimal wastage- produce how much is required!
  2. Use energy efficiently! 
  3. Go green on food- Use GMO-free products for cooking. 
  4. Staff training to ensure minimal wastage. 
  5. Donate food to the needy. 
  6. Support education. 
  7. Focus on the 3 R’s- Reduce, Reuse and Recycle. 
  8. Donate used equipment or decor. 
  9. Support your locals- artists and community members.

All in all, a brand’s corporate social responsibility is the company’s accountability to the economic and social sectors of society. Since millennials are willing to contribute in solving multiple social issues like hunger, and climate change, planning activities under CSR has become a mandate for Indian restaurant brands. It becomes a win-win situation when the customers don’t mind paying the extra 5-10%.

 

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