What Is a Social Audit?

What Is a Social Audit?

Let me explain what a social audit is: it's a formal review of a company's endeavors, procedures, and code of conduct regarding social responsibility and the company's impact on society. Essentially, you're looking at an assessment of how well the company is achieving its goals or benchmarks for social responsibility.

Key Takeaways

Here's what you need to know right away: a social audit is that formal review of a company's efforts in social responsibility and its societal impact. It's about checking if the company hits its social responsibility targets. And ideally, companies like yours aim to balance profitability with social responsibility.

Understanding a Social Audit

You should understand that companies ideally strike a balance between making profits and being socially responsible. A social audit is your internal examination of how your business affects society. It helps you determine if you're meeting your objectives, which might include measurable goals and benchmarks. This audit lets you see if your actions are positively or negatively received, and it ties directly to your company's overall public image.

In today's era of corporate social responsibility, you're expected to deliver value to consumers and shareholders while meeting environmental and social standards. Social audits can help you create, improve, and maintain a positive public relations image. For many companies, good public perception fosters a positive image and reduces negative impacts on earnings from bad press.

Items Examined in a Social Audit

The scope of a social audit can vary widely, including social and public responsibility as well as employee treatment. You might examine environmental impact from operations, transparency in reporting issues affecting the public or environment, accounting and financial transparency, community development and financial contributions, charitable giving, volunteer activity of employees, energy use or impact on footprint, work environment including safety, freedom from harassment, and equal opportunity, worker pay and benefits, nondiscriminatory practices, and diversity.

There's no standard for what's included in a social audit. Since they're optional, you can choose to release results publicly or keep them internal. This flexibility means you can expand or contract the scope based on your goals—maybe focusing on a single town or scaling up to a global level.

Example of a Social Audit

Take Salesforce.com, a Fortune 500 company and major player in enterprise software. In its social audit, the company has pushed to use 100% renewable energy globally. They publish findings in an annual Stakeholder Impact Report on their website. For instance, in 2017, they reported progress toward this goal, and according to their site, they were one of the first cloud companies to commit to full renewable energy for data centers. You can see graphs in their reports showing where they stand.

Use of Social Audit Findings

Since social audits are voluntary, releasing findings to the public is also up to you. Positive results might get shared, while negative ones could stay internal to identify improvements for the next audit.

For example, if your audit shows inadequate community involvement in charitable activities, you could set initiatives with measurable goals to boost that. Monitor and analyze them in the next audit. By striving to meet and exceed social responsibility benchmarks, you can improve public perception over time. In short, social audits help you achieve a balance between profits and ethics.