Riding the Wave of Corporate Social Responsibility
Corporate Social Responsibility, or CSR, is a growing trend in businesses today. But, I ask why? What do companies gain by integrating the missions of charitable organizations into their own business strategies? Couldn’t the business just write a check instead? Wouldn’t that be easier and less complicated?
Surveyed Americans, however, seem to indicate they want more than such a superficial commitment to CSR as writing a donation check. The 2007 Cone Cause Evolution Survey found 83 percent of Americans believe companies have a responsibility to help support causes. Another 92 percent said they have a more positive image of a company that supports a cause they care about. And 87 percent said they are likely to switch from one product to another (price and quality being equal) if the other product is associated with a good cause, an increase from 66 percent since 1993.
This has resulted in a shift in the value equation, where good business means developing meaningful relationships with all stakeholders, and taking a stand on relevant business issues in addition to providing a quality product or services.
As a result, businesses wanting to be considered ethical and socially responsible corporations have skyrocketed in the post-Enron era of corporate scandals. CSR not only draws the interest of investors and customers, it also keeps labor and environmental activists at bay. Most importantly, CSR attracts top talent.
A 2007/2008 Towers Perrin Global Workforce report that studied employee engagement of 88,000 workers in 18 countries found that among the top drivers of higher employee engagement was a commitment to corporate social responsibility.
“Employees want to work for a company that is seen as a leader,” the report stated. “Employees worldwide show a desire to work for an organization that strives for excellence in the eyes of its employees, customers and the world at large.”
Traci Rose, vice president of community relations for the Portland Trailblazers, agreed that the organization’s community commitment has been a recruitment tool for potential employees. The Trailblazers were recognized for their CSR practices with the national Points of Light service award in 1999, becoming the first company in Oregon and the only NBA team to win the award.
Some large Pacific Northwest businesses are making CSR a core feature of their businesses. Acumen Solutions, Nike and Hewlett Packard are among the large businesses that have adopted Corporate Social Responsibility. Starbucks recently released its seventh annual CSR report.
“Even during this time of change for our company, one thing that will never change is our long-standing commitment to conducting business in a responsible and ethical manner,” said Howard Schultz, Starbucks’ president, chairman and CEO, in a statement. “Going forward, we will only deepen our approach by continuing to integrate social and environmental responsibility into every aspect of our business.”
There also are many small businesses that have adopted CSR. The Portland-based gDiapers is all about social responsibility with its motto of Fair Dinkum, which according to its website is an Australian expression that means being genuine and real with everyone you encounter. The company is promoting its flushable and truly disposable diapers as an alternative to filling landfills with other “disposable diapers” that won’t break down for more than 500 years. For its efforts, the company recently was honored as one of three winners of the 2008 Oregon Ethics in Business award.
It is these types of companies that are drawing today’s human capital talent. Smart young professionals want to work for companies that are socially responsible. These workers want to be proud of where they work and, equally as important, want their employers to be an active participant within the community.
Actively engaged employees dedicate themselves to a company, rather than just putting time in for a company. This dedication decreases turnover rates and increase productivity. And the costs per hire are also lowered because rather than having to scout for talent, talent is coming to a CSR-committed company. Another benefit is that engaged employees show lower stress levels which, in turn, is expected to lower health care costs to companies.
The Human Resources departments within these companies are uniquely situated to help reap the benefits of being socially responsible. CSR incorporates sustainable business practices, such as turning off the lights and otherwise reducing a company’s environmental footprint, which will require motivating and training employees to change workplace behaviors.
HR departments also will have a role in identifying what CSR practices employees and top recruits really want – such as giving employees one or more work days a month to volunteer in the community. HR professionals can also be instrumental in helping bring together various departments and divisions within a company to talk about CSR and what it means to that company. HR professionals can also assist companies prioritize opportunities to help in their own communities.
So why do companies want to involve themselves in corporate social responsibility? Because it has a positive effect on the community within which they exist, it has a positive effect on their employee relations and finally it has a positive effect on their bottom line.