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Why we all need to start thinking big about CSR
“Philanthropy is the future of marketing; it’s the way brands are going to win.”
If Stephanie McMahon, the chief brand officer of entertainment business WWE, was looking to encapsulate everything that’s wrong with what corporate social responsibility (CSR) has become in a single tweet back in 2015, she nailed it.
The veneer has gone. Acting in a responsible way should be de rigeur simply because it is the right thing to do. But giant corporations are now apparently comfortable talking openly about how by appearing to do good, and to help the communities around them, they will be able to enjoy a competitive advantage over their rivals.
CSR boosts the bottom line
A study by KPMG found that a massive 93% of the world’s largest 250 firms now publish an annual CSR report. That so many huge businesses are engaged in actively highlighting the good work that they do says a lot. They are well aware of the potential benefits offered by taking a responsible approach, publicly at least.
According to a study by the US consulting firm Reputation Insight, our willingness to buy, recommend or even invest in a firm is driven 60% by our perception of the company itself, rather than the goods or services it offers.
And it’s the way that firm behaves, the decisions it makes and the knock on effect those decisions have on our communities that informs that perception. As Kasper Ulf Nielsen, executive partner at the Reputation Institute, said: “CSR speaks to who the company is, what it believes in and how it is doing business.”
It’s not just that people are more likely to use your services either - they are willing to pay more for it too, according to a global Nielson study in 2014.
The cynicism around CSR
While CSR has boosted the bottom line for many businesses, there is still a significant amount of cynicism around the subject. Is it ever anything more than a transparent push for better PR?
That there have been so many scandals involving large firms talking up their responsible approach, while indulging in less ethical activities, has only further damaged the case for CSR. Take Volkswagen and the emissions scandal - while it was enjoying huge sales due to its apparently environmentally-friendly vehicle design, it was simultaneously fiddling its emissions levels.
When a business giant’s rank hypocrisy is exposed so publicly, it doesn’t just damage the firm in question - it taints other businesses that highlight their CSR efforts too. If Volkswagen or BP are using CSR as a protective public relations shield, then it stands to reason other firms are too, right?
Getting it right matters to your staff
For all of the perhaps understandable cynicism around CSR, it would be wrong to write it off entirely. It’s not just consumers that put weight into dealing with responsible firms - employees do too. Making a genuine CSR effort will make a difference to your workforce.
For starters, there is the calibre of candidates you’ll attract. The Macquarie University Graduate School of Management conducts a biannual study into the attitudes of business students towards CSR, as part of a UN initiative on responsible management. More than 90% said they would be willing to sacrifice some of their salaries in order to work for a responsible employer. Incredibly 14% said they would be willing to give up as much as 40% of their salary in order to work for an employer that was openly socially responsible.
Demonstrating that you are behaving responsibly - and for the right reasons - is an excellent way to get quality candidates through the door in the first place.
But it’s also a great tool for keeping them engaged with your company.
A study a few years ago found that almost two-thirds of employees would feel significantly more engaged if their employer allowed charitable working, rising to 70% for those aged 20-30. Millennials are a more sceptical generation than those that came before them - trying to enter the working world in the aftermath of a financial crisis while dealing with thousands of pounds of university debt, will do that to you. But they are also the ones most likely to invest emotionally in quality CSR projects.
Involving your employees in CSR
A key to doing CSR properly is to get your employees to buy into your process, to feel like they are involved in the formulation as well as the execution of your CSR activities. You can’t have your employees feel like CSR is simply something that other people within the organisation do, following commands from the top of the organisation. Input from everyone in the business is crucial if you are to devise a genuine and effective CSR programme.
That means speaking to your staff about what really matters to them. What would they like to see the company do which would make a positive difference, whether large or small? If they feel that they are helping to steer the company’s CSR direction, they are more likely to commit to it. That can only boost the final result.
A nice example is Booking Cares, a programme launched by travel site Booking.com a couple of years ago following a series of employee surveys. It encourages the firm’s employees across the world to volunteer with local organisations to help sustainable tourism - that means ensuring local communities all benefit from tourism, as well as promoting and preserving the cultural heritage of those destinations.
It’s CSR that chimes with the everyday experiences of its staff - they see the less positive effects of tourism, and can identify better ways to support the local communities. They are driving the initiative and empowered to make a difference.
It’s more than a mission statement
Anyone can write a grand sounding CSR mission statement, talking about taking steps to effect change and make the world a better place. But if you are going to do CSR properly, there has to be a lot more to it than words.
For example, you can’t simply talk about wanting to help the environment without being able to point to exactly what you are doing. And it can’t simply be a ‘please don’t print this email: we all love trees’ message in your signature or the occasional recycling drive. It needs to be ingrained in the way your business operates on a day-to-day basis.
Employees and customers will quickly see through token efforts. If firms are going to do CSR properly, then they have to commit to it.
What about scale?
One problem that some people have with CSR is its sometimes limited scale. Claudia Costa, a language specialist at Booking.com, writing on the firm’s Booking Cares blog, encapsulates the issue nicely:
“Are we really changing things for the long-term? Beach or city clean-ups are a great way to show our commitment to local communities, cultural heritage days are so cool, and city runs are always good fun… But alas, waterfronts and streets become dirty once again, cultural events only take place a few days a year, and not much is left of marathons after we cross the finish line.”
This really highlights the need to take a more long-term approach to CSR. Inevitably smaller efforts are going to have a more limited impact. But by taking a more long-term approach, by viewing your CSR activities as something you will be doing for the next couple of decades rather than the next couple of years, you can identify areas where your efforts can result in more long-lasting, significant change.
Businesses are always encouraged to think big when it comes to commercial projects; it’s time that same attitude was prevalent when considering social enterprises too.