A lot of companies have integrated corporate social responsibility (CSR) into their business model. It is a way to connect their mission with their values in order to engage with the community. But, the important question that companies can ask themselves when they are focusing on CSR is:
“Are we integrating CSR because it looks good or because it truly partners with the community in a meaningful way?”
Companies can fine tune their CSR efforts by first engaging with the community in a way that doesn’t feel or look transactional. A lot of times companies see hot topics like: sustainability, social justice, food insecurities, education; and they want to pour money into those areas. Investing may be somewhat effective and may even look good from a consumer perspective. Yet, it is more important to work in tandem with those communities, rather than seek investment as the only means of community outreach and service. Eventually, I believe consumers can sniff out disingenuous claims of a company’s investment; and it really doesn’t add long-term value for the company or the communities they serve. Instead, companies should seek to listen to the long-term needs of these communities and even drive impact by eventually creating an employment bridge between the community and the company. How companies prioritize CSR must first take heed to drive impact, connecting to the genuine needs of the community.
Why should CSR be a priority for companies?
CSR is not only important to a company’s bottom line, because it drives like-minded consumers who care about its sincerity, but it also helps to contribute to a company’s brand messaging. A company’s brand reflects their mission and values. CSR can help companies reiterate and reflect their mission and values in the communities they serve. Done correctly, CSR can build a true connection with consumers in those communities, and create long lasting relationships. Companies stick around because they are valued by the community. After all, to serve their communities in essence is to serve their customers.
A study mentioned in Forbes, found that 60% of people’s willingness to buy, recommend, work for, and invest in a company was driven by its perceptions of that company rather than its products and / or services. Customer perceptions are heavily influenced by a company’s CSR practices.
CSR should also be a priority to improve employee relationships and retention rates. Employees often question their value at work and whether their skillsets and strengths are truly being valued by their employer. Corporate Social Responsibility can bring the confidence back to employees who may feel their value has yet to be fully realized in the work they do. When employees get to volunteer with nonprofits and work within the community, they bear the potential to stand a little taller both in the community and in their workplace. They feel like they are a part of something bigger than themselves. I’m convinced that employees feel like they are connecting more with their employer’s mission and values, and they are more proud to be a part of all that the organization stands for in the community. Let’s be honest, people come to work when they are happy, and they leave when they are not. When companies commit to their CSR practices and incentivize employees to engage through volunteering, employees feel appreciated, and provide more value to their workplace.
How can companies start reshaping and redefining their CSR programs and practices?
First, companies must understand the level of influence they have to inspire communities. They can start to think critically about how they can use that influence for the greater good of the community where they do business, and/or the area nonprofits that they support, while concurrently driving business ROI, and market growth.
Companies should ask themselves:
“How are we investing dollars to drive widespread impact within a community or nonprofit organization?”
“How are we aligning with our mission and values; and are our business priorities in sync with the community and /or the community organizations we support?”
“How are we inspiring employees to engage in our community outreach initiatives?”
Secondly, companies should start to explore deeper partnerships with nonprofits that align with the company’s mission, vision, values, and annual priorities. For companies exploring BIPOC lead nonprofits, there is an opportunity to drive impact in communities of color through trusted grassroots nonprofits who traditionally receive a small percentage of funding in comparison to the larger nonprofits that have historically had white executives at their helm. Smaller organizations serving communities of color can be highly effective because they’re connected with the community and know firsthand the pressing needs facing the communities they serve. When corporations invest in smaller organizations, it permits these organizations to scale and drive sizable economic impact on food desert neighborhoods and areas of the city with a limited supply of child care options.
I believe it’s essential to bring these community nonprofit experts in to ensure authenticity of outreach and corporate values align, as both consumers and investors are looking to see how corporations prioritize environmental social governance (ESG) as a whole; which encompasses both CSR and diversity, equity, and inclusion (DEI). An investment in an ESG, CSR, and a diversity and inclusion expert confirms that top executives believe in the value, understand the value, and want to relay their community stewardship both outwardly amongst industry peers, and throughout the whole organization. Not to mention, once more, that this level of corporate influence driving community impact also bears potential for an admirable ripple effect for broader community-wide support.
A great example of CSR done admirably is Xcel Energy. As a community member and a consumer, I’m forever in awe of their leadership in CSR. The community has partnered with nonprofit organizations, both large and small, and engaged employees in a way that inspires them to give back to their community. Their motto is, “When our community thrives, we all thrive,” and they truly practice what they preach. I’ve come to regard Xcel as a CSR leader here in Colorado for the way they align their stewardship with company priorities: promoting STEM, preserving the environment, operationalizing a diverse and inclusive workforce, as well as supporting arts & education. Xcel ignites change and makes a difference across public and private partnerships. I’m convinced that their unwavering commitment to the community encourages employees to lend their help in driving community impact. The company’s annual Day of Service event is just one example where employees collectively contribute 80,000 hours of volunteer service.
How can the marketing team boost a company’s Corporate Social Responsibility efforts?
Marketing can help companies craft an authentic story of community stewardship. Companies may be doing CSR with integrity and authenticity, but marketing needs to be involved to show “the how,” and most importantly “the impact.” Marketing will be able to break down the company’s metrics and detail what impact they are truly making when provided data on community investments and where the money is directed to drive measurable change. Don’t forget to include the marketing and development teams at the nonprofits too, as to keep both the company and the nonprofit on the same page; and tell an accurate story about alignment of priorities. That story should prioritize and celebrate the individuals and communities that benefit from a company’s CSR commitments. Where there is an authentic partnership between a company and a community, the story can be less about how the company “saved” the community; but more about how the community proved resilient when connected to resources that improved their economic trajectory; and how through the partnership that works is actually benefiting the people it intended. It’s this public-private partnership approach that helps enhance the CSR story, which wouldn’t be sincere or effective without the collaborative efforts of employees, community partners, and resilient community members.
Not all companies see the value in building a strong CSR program. This often stems from a culture where profits and ROI are given greater priority than human capital. I’ve witnessed how executives from large organizations have missed the mark in approaching Corporate Social Responsibility market by market. They fail to understand the influence of community or how community investments will deliver return on a company’s brand equity. I think they are creating a disservice to growing the reputation of their brand, creating connections with their consumers in the community, and improving their employee relationships. If companies are not factoring in these CSR benefits they may be missing out on brand loyalty and possibly future investment. According to Forbes, 61% of investors consider CSR a sign of “ethical corporate behavior, which reduces investment risk.” Therefore, building a CSR program with finesse and integrity is a win, win, win for all key stakeholders.
I hope moving forward that more organizations will embrace the value of corporate social responsibility and its impact on aligning business and communities.
