A Corporate Social Responsibility Program: Investing in Impact
For years, organizations considered investing in a corporate social responsibility program a low-priority business strategy. Companies might have made a one-off financial investment or hosted a fundraiser, but rarely was philanthropy a robust and ongoing strategic effort. This is because leaders were reluctant to commit holistically to investing in impact, perhaps because they didn’t feel they had the resources to build a successful and scalable initiative or the capability to measure the results.
However, with new regulations around transparency and consumers gaining more visibility into companies’ sustainability and ethical practices (or lack thereof), scrutiny has become greater and expectations higher. Now, businesses have too much to lose by not developing a corporate social responsibility program. It’s a necessary competitive advantage to attract and maintain consumers.
Fortunately, the evolving business landscape and the advancement of technology and information-sharing have made doing good more doable than ever. The three biggest factors impacting social impact programs are consumer and workforce demand, industry regulations and guidelines, and technology and reporting.
Factor One: Consumer and Workforce Demand
When given the option, consumers, millennials and Gen Z’ers most of all, direct their loyalty and buying power toward brands that demonstrate shared values around social action. They want to see results and their patronage is contingent on it. The concept of corporate social responsibility appeals to these customers, and in a survey of 30,000 consumers, nearly 75% of respondents ages 19-34 said they would pay more for sustainable products. Some business owners may think remaining neutral on social issues is the safest approach, but in reality consumers and employees want brands to take a stance–over half of millennials surveyed said they’re more likely to buy products from companies with an activist CEO and 44% of millennial employees would feel more loyalty toward their CEO for taking a stand on a contentious issue (versus 19% who would not).
Factor Two: Industry Regulations and Guidelines
While there is no legislation enforcing corporate social responsibility programs, more regulations are emerging to increase transparency around business practices, such as reporting conflict minerals in products and workforce diversity statistics. There are also rewards for charitable organizations, such as tax benefits. Global guiding principles, resources, and best practices offer assistance and recommendations, such as The Ten Principles of the UN Global Compact crafted by the United Nations, which outlines how businesses can operate more sustainably and responsibly in terms of human rights, labor, the environment, and anti-corruption. Since the practice of corporate social responsibility by definition is largely voluntary, companies have a great deal of freedom in creating a corporate social responsibility initiative that best meets their own goals and standards and the unique needs of their community.
Factor Three: Technology and Reporting
Business leaders often have a misperception that ROI and social impact are too difficult to prove. This doesn’t have to be the case; especially today, as the ROI and social impact of a corporate social responsibility program are only getting easier to measure with progressive technology platforms and program management software that can streamline the advantages of corporate social responsibility by generating meaningful data and insights. Companies can leverage advanced digital tools to efficiently track and measure data and impact like never before and use social media to showcase the results to the community and encourage employees and consumers to share, as well.
Now is the time to develop an impactful and measurable initiative for social, economic, or environmental good – the market is ripe for it.
Next in this Investing in Impact Series, learn about Best Practices for Incorporating CSR into your Business.
To learn more about CSR, visit: www.Everfi.com/CSR