Corporate Social Responsibility or CSR continues to gain prominence within organisations and rightly so. CSR takes many different forms, from huge corporate global programmes and partnerships to small local initiatives. But whether large or small, the overall goal remains the same, to give back to the community that a business serves. This may be via simple volunteering or donations to a specific cause or be as complex as overhauling an entire business model to be more environmentally friendly. Although this is traditionally seen as charitable given, there are also obvious business benefits. Research has shown 55% of consumers will pay more for a product from a socially responsible organisation. Businesses that spend more on CSR also have a better financial performance than those who do not.
Improve Employee Engagement
There have been several parallels drawn between how an employee treats its employees and how its treats its community. Naturally, an organisational culture that focuses on creating a positive, inclusive, and empathetic culture is going to treat both its employees and community well. On the other hand, a culture that is selfish and focuses only on the bottom line, will neglect both. In addition, employees with a purpose outperform those who do not have one. What better way to provide employees with a purpose than to enable them to give back to the community they are part of and be paid to do it. CSR is also a critical issue for millennials with a Nielsen survey showing 73% of millennials would prefer to work for a socially responsible organisation and 81% of millennials expecting their firm to make a public commitment to being good corporate citizens.
Further research from Nielsen shows that a company’s commitment to CSR is a key driver of consumer spending habits. They found that 56% of said that a brand being known for its social responsibility made them more likely to purchase a product from them. Likewise, 53% said an organisation with a community commitment was also an additional driver of purchasing behaviour. Millennials place even more importance on this and prefer to buy from businesses who demonstrate high levels of ethics and sustainable manufacturing methods.
Finally, it would be remiss to not mention the obvious public relations benefits to CSR. We live in an ever-connected digital world, and one photo or tweet now can make or break a business reputation. One viral campaign can reap untold benefits for an organisation through its work in the community. Likewise, one negative story detailing unethical behaviour, mistreatment of individuals or some other irregularity can be a body blow to a business. However, firms that get this right, it’s a win-win. CSR enables better employee engagement and retention and increases sales and custom loyalty. Only a poorly run business would ignore its Corporate Social Responsibility.