Why Focusing on CSR Is Your company’s Biggest Win for 2022
STORY INLINE POST
Social responsibility is more important today than ever before. Globally, businesses have an obligation to develop realistic and positive long-term goals for their people and for humanity at large. Social responsibility empowers employees to use the corporate resources at their disposal to do good. Formal corporate social responsibility programs can improve employee morale and increase workplace efficiency. Being a socially responsible company can also bolster a company's reputation and build its brand.
Companies that prioritize purpose perform better than others. This is according to a report showing that 58 percent of organizations that have a strong and clear sense of purpose experienced 10 percent or more growth during the last three years.
Why is focusing on CSR going to be a win for companies? The report reveals that purpose-driven companies make more money, have more engaged employees and more loyal customers, and are even better at innovation and transformational change.
First Win: Brand Perception
Customers have become more cognizant of issues such as climate change, pollution, income inequality, healthcare availability, unfair labor practices, racial discrimination, and gender inequality.
Seventy percent of Americans believe it’s either “somewhat” or “very important” for companies to make the world a better place. In a highly competitive contemporary market, brands must exceed customer expectations to make them memorable and improve the brand’s perception in the minds of customers. CSR not only builds the credibility of a company but also facilitates the formation of close, trust-based relationships with customers.
Second Win: Customer Retention
Acquiring a new customer can cost five times more than retaining an existing one. Brand loyalty is all about emotional connection. It is the long-term key to business success because satisfied customers not only buy services and products again but also recommend the company to others.
Customer loyalty is achieved in two ways: through offering a unique customer experience and humanizing your brand through CSR initiatives. A robust CSR strategy contributes toward building a good reputation with all stakeholders, which, in turn, helps develop trust and loyalty. This is especially significant as millennials – who place a premium on social responsibility – take over an increasing share of spending power in the global market. In fact, 77 percent of consumers are motivated to purchase from companies committed to making the world a better place.
Third Win: Attracting and Retaining Employees
In the global war for talent, CSR is a must for attracting and retaining employees and is directly related to employee engagement. Younger employees in particular are seeking to be part of something “bigger,” where they can help to make a difference and where business is not just about making profits. Recent research reveals that nearly 70 percent of employees say they wouldn’t work for a company that didn’t have a strong purpose.
They want to be inspired, to feel good about their employment choice, and to join an organization that is aligned with their values. This means they will actively look for potential employers that support causes they are passionate about and that share their viewpoints on the importance of giving back.
A strong CSR strategy can help cement the values that workers relate to. It shows that a company cares about people internally and externally to their business. It also helps to convey the impression of a positive, proactive working environment in which employees can thrive and where they can feel comfortable.
Fourth Win: Increases Business Opportunities
Sustainable CSR initiatives have been shown to positively affect the business bottom line. A strategy that talks to solid corporate values attracts both investors and clients who are aligned with those values. This helps them to believe that they are playing their part in making the world a better place.
In addition, a meaningful CSR policy also demonstrates that the business is accountable to all stakeholders and is less likely to engage in morally questionable behavior or misconduct that could result in financial loss and risk to investors. As this report shows, 61 percent of investors consider CSR as a sign of ethical behavior that reduces investment risk.
Fifth win: Support for Local and Global Communities
While the wins discussed above are extremely attractive for organizations, the key reason that CSR programs exist is to give people the leverage and the platform they need to make a difference in local and global communities.
If we view companies as communities of like-minded, talented people working toward a broader vision, then a business can make a genuinely significant and positive impact on important global issues that are all of our responsibility.
Shoe company TOMS was an excellent example of how a product-led CSR initiative could support global communities. Established in 2006 with the social mission of matching every pair of shoes purchased with a pair of new shoes for a child in need, the company furnished millions with shoes in its heyday.
There are many global and national issues that companies can choose to support:
- Environmental causes: Ford has invested $22 billion in electrification, aiming to make all its vehicles carbon neutral by 2050.
- Employees: Netflix and Spotify extended their paid parental leave recently to support employees and their families, going above and beyond any government requirements by offering full paid time off.
- Philanthropy: Pfizer donated $40 million to help improve recognition, diagnosis, treatment, and management of COVID-19 patients in the US, building on its long-standing commitment to fight infectious diseases and help address urgent needs of its US and global partners on the frontlines of the pandemic.
Moreover, to contrast the spread of fake news during the pandemic, as PQE Group, we put in place a new project: a task force of employees within the corporate community to conduct research on one of the most discussed side-effects of COVID-19: the Infodemic.
There is no doubt that the way we do business and the way companies present themselves to their customers has changed. Now is the time to make authentic CSR an active part of your strategic business plan for the future. It’s never too late to start making a difference, and it just makes business sense.