CSR is a good PR exercise and in today’s business world, a business must perform CSR activities. Businesses must go further than just saying they are doing wonderful things; they must prove it too. If brands are seen not performing CSR or, even worse, found not to be performing the social good they said they were, the once-loyal consumer base will leave them for brands that do.
What is Corporate Social Responsibility (CSR)?
We have come a long way since the 1970s when Milton Friedman professed that the only social responsibility of a business was to make money. Today, businesses need to be concerned about the economic, ethical, environmental, and philanthropic responsibilities to the business, its employees, and its wider community. Briefly, CSR is a self-regulating business model where a business is socially accountable to its stakeholders.
What are the benefits of CSR?
Embedding CSR best practices into your business model will help you improve your employee engagement, build brand awareness, make your business more viable to investors, and do good for communities. Additionally, CSR activities can increase your ROI (return on investment). There are plenty of benefits to both a business and its communities to performing CSR activities. Let’s go a bit deeper into the benefits of CSR.
3 business benefits of CSR:
Customer loyalty
These days, customers are not as brand loyal as they once were. Baby boomers (1945-1964) and generation X (1965-1980) are the most brand loyal. However, if you are marketing to Millennials (1981-1999) and Generation Z (2000-present), you will find these generations have the least brand loyalty.
To maintain brand loyalty in Millennials and Gen Z, you need to uncover what social, ethical, and environmental issues matter most to your customers and invest in these. If a customer feels that by using your brand, they are living out their values (for example, reducing plastic waste) then they will more likely be loyal and advocates of your brand.
67% of customers will boycott brands with opposing social views.
Competitive edge
Strong CSR initiatives can give businesses the edge over other businesses in the same markets as them. Again, if your target market has strong values based on initiatives you are doing, they will more likely choose your business over your rivals (even if your products are priced higher).
Satisfied employees
When searching for jobs, 70% of millennials consider a business’s social values and environmental policies. You want to make sure that your values can be found and that you live those values too.
Since early 2021, the UK has been gripped by ‘the great resignation’, and this is set to continue with a third of the workforce reportedly considering a new job. Reports from Ipsos Mori suggest that pay, lack of promotion, workload, and being forced back into the office after working from home are the top reasons for people resigning.
If an employee leaves the business, that employee is taking their expertise, experience, and knowledge of your business with them. You then have additional costs such as searching for a new employee and training that employee. It makes business sense to ensure your employees are satisfied in their jobs and less likely to resign for those reasons alone.
Community and global benefits of CSR:
A more sustainable business
With government legislation continually changing in terms of the environment, if you are already doing more than the accepted standard, you are futureproofing your business as well as showing customers that you care about environmental issues. Additionally, sustainable businesses are more viable to investors and there is plenty of additional funding for sustainable businesses.
A better world to live in
Aside from the financial business benefits, you are also doing good in local and global communities. By being green and using renewable resources you are helping to save the planet. By undertaking local philanthropical activities you can help improve the lives of many grassroots organisations which in turn can improve the lives of people living in that community.
How to create a great business CSR strategy
You have seen the benefits of CSR activities, now you need to embed some CSR practices in your workplace. Here are our top 5 tips:
- Be compliant in all areas of business – The first thing you need to ensure is that you are compliant in all areas of your business. If you start pushing a CSR strategy without the fundamentals of your business being great, you will get called out by your customers.
- Involve the workplace – One person does not just make a CSR strategy, you need buy-in from everyone. Find out the current issues that matter to your employees.
- Align your CSR strategy to your current business goals – A good CSR strategy is something that is aligned with your business. For example, H&M now have recycle bins in some of their shops where customers can hand in clothing they no longer wear and get a voucher to shop there. A win for the environment and customers gets something of value.
- Manage your resources effectively – You need to consider how much you are spending on CSR activities including people hours, marketing, and the finances you are putting into the activities.
- Tell people about your CSR initiatives – It makes sense for a business to tell everyone about their CSR initiatives from a financial and reputational perspective. Tell your customers on social media, on your website and even press releases to local news publications.
How to communicate your CSR activities
You can communicate your CSR activities in multiple ways. The management team will always want to know how their cash is being spent so accurate reporting to them is necessary. Give them some data to back up what you are saying. You also need to communicate externally to let your followers, customers and the public know.
Social media – a key component of messaging, you need to highlight accurately what you have done, not just by saying you have done it, but by showing you have done it (and where you can show your work in action).
Website – A lot of companies now have a mission and values page highlighting the good they have done in the community. Again, imagery and video work well here.
Get some PR – contact your local newspaper (they have a huge reach in print and online) and local media is often seen as a trusted source of truth by older generations. If you worked with a local grassroots charity, do the piece together, highlighting how your business helped the grassroots organisation achieve its goal. Take your time here to ensure that you are not coming across as a sales pitch!
Examples of good CSR
LOCALiQ – employee reward and community benefits
Here at LOCALiQ, we give our staff rewards such as a paid day off for their birthday, the option to work from home (employee reward – better work/life balance, lower cost on childcare, less money on petrol; environmental benefit reducing pollution), dedicated resources and time for personal development, and a paid day off each year for volunteering. The volunteering day does not just benefit our employees, it benefits local communities too!
Toms Shoes – donating profits to grassroots organisations
Originally Toms donated a pair of shoes to a child for every pair you bought but in recent years has changed its offering. Toms now changed its model to donating a third of its profits to grassroots organisations. They currently invest in projects that tackle mental health, increase access to opportunity (BAME, LGBTQ+, females), and end gun violence in the US.
Ryan Reynolds & Rob McElhenney – building Wrexham
Co-owners of Wrexham Football Club are not simply great actors, they are philanthropic good guys too. As well as providing Wrexham FC financial aid, they have also been doing good in the community of Wrexham. Ryan Reynolds has been reported as saying “Our work in Wrexham has as much to do with the football club as it does with the community that surrounds it.”
So far, the pair have given frontline NHS staff and charity workers of Wrexham free tickets to see Ryan Reynolds’ Free Guy in 2021, as well as giving a ‘generous financial donation’ to a local food bank and paying for a lifelong Wrexham fan to have adaptations to his home, due to his medical conditions.
When CSR goes wrong
It is not just companies that are called out for greenwashing or poor CSR practices, sometimes whole industries and genres are called out.
Business
Volkswagen – Clean Diesel
Remember when Volkswagen claimed their diesel engines were reducing pollutants by 90%? In 2015, their ‘clean cars’ were found to be producing 4000% more pollutants. Apart from receiving $30bn in fines, their reputation took a massive hit which has taken years to improve.
Industry
Fast fashion
80% of clothing is either discarded in the landfill or incinerated, leaving only 20% that is recycled and reused. As well as this, fast fashion can be made cheaply in poor or developing countries where workers are exploited, and work in unsafe conditions. The Rana Plaza collapse which killed over 1000 people in Bangladesh in 2013 highlighted how poorly those making garments for high street fashion chains were treated.
Bottled water
Bottled water is a major contributor to plastic waste, yet look at the imagery used on these bottles, they often contain images of nature. This imagery is completely at odds with the reality of plastic waste.
Genre
Pride
In June, many Pride events happen globally to commemorate the Stonewall riots of 1969. When Pride events occur in the UK’s cities, brands are quick to turn everything rainbow coloured in a so-called gesture to Pride, leading to pink washing and Rainbow Capitalism. If you want to do social good, you need to do more than just put a rainbow on everything or give a shout out about one of your LGBTQIA+ persons in the workplace, you need to demonstrate how you are supporting the LGBTQIA+ community year-round. Are you donating to an LGBTQIA+ charity? Does your LGBTQIA+ employee feel valued all year round?
International Women’s Day
March 8th is International Women’s Day. Twitter was awash this year with businesses and organisations promoting women, however, Gender Pay Gap Bot published pay gap data on every company that posted about their women. The results were a sobering read and saw some brands deleting their tweets, although eagle-eyed people soon retweeted the information.
In the words of Robert Baden-Powell, “leave the world a better place than you found it.”
Once you’ve successfully implemented a CSR strategy within your business, why not partner with LOCALiQ to spread the word? We’ve already worked on hundreds of successful campaigns for businesses that are committed to positive action.
