What is corporate social responsibility and how to create a program

by | Mar 23, 2022 | Articles, Blog

Did you know that more than two-thirds of people say CEOs should step in when governments don’t fix societal problems? That’s quite an expectation!

So, how should modern businesses address this need? In this article, we’ll explore the idea of corporate social responsibility (CSR) and set out six steps you can take to set up a program for your company.

What is corporate social responsibility?

Simply put, CSR is the idea that businesses should take active steps to contribute to the communities in which they operate. This could mean anything from working with local charitable organizations to participating in global initiatives such as Giving Tuesday

CSR programs can focus on making a difference in several ways, such as by tackling poverty, inequality or climate change.

This is not a new idea. As far back as the late 19th century, magnates like the Cadbury brothers were doing it. In 1893, George Cadbury bought 120 acres of land around the rural site he’d chosen for the new Cadbury factory. At his own expense, he planned and built a new village there for his workers and others, with good quality homes and affordable rent. The Bournville Village Trust is still in operation today.

These days, of course, CSR isn’t just the province of individual philanthropists. It’s a live issue that modern businesses can’t afford to ignore. 

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Why does corporate social responsibility matter?

CSR should be on your radar for several reasons. For one thing, even if you’re not focusing on it now, there’s a good chance your competitors are. The Governance & Accountability Institute reports that 92% of S&P 500 companies published a sustainability report in 2020 versus just 20% in 2011.

Of course, it’s easy to see how CSR policies benefit the causes they support, but what about the business itself? Let’s have a look at how and why CSR is important for your customers, your employees and your executive team.

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For your customers

AFLAC’s 2019 CSR survey contained some revealing stats. Did you know that 77% of US consumers say they’re ‘motivated to purchase from companies committed to making the world better’? Or that 49% believe it’s very important a company makes the world a better place? 

Corporate social responsibility graph
This translates into practical decisions too. GreenPrint found that 78% of people are more likely to buy a product labelled as environmentally friendly.

What’s more, young people care about CSR much more than the older generation. Around 41% of millennials invest significant effort into understanding a company’s CSR policies, versus 27% of Gen X and 16% of baby boomers.

For your employees

Having a happy and engaged workforce is a priority for any modern business, and while strategies such as workforce optimization software and recognising staff excellence have their place, you shouldn’t ignore the impact CSR can have either.

Porter Novelli’s Wave X study reported that 88% of employees agreed with the statement: ‘it is no longer acceptable for companies just to make money; companies must positively impact society as well’. 

Around 69% of respondents said they wouldn’t work for a company that doesn’t have a strong purpose, and an astonishing 60% claimed they’d take a pay cut to work at a purpose-driven company.

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For your executive team

If some senior executives are sceptical about developing a CSR program, that’s understandable. After all, whatever form of program you go for, there will be set-up costs. There might also be a lingering sense in the boardroom that CSR initiatives distract from the company’s core business objectives.

However, as we’ve already seen, a good CSR policy can actually attract customers and engage employees. When it comes to the bottom line, it can be good for profitability so long as it’s handled well. That’s because increased customer and employee engagement result in higher sales and better staff retention.

Let’s not forget investors either. There’s been a huge surge in interest over the past few years in sustainable investment funds. In 2020, the total amount invested in ESG (environmental, social, governance) exchange-traded funds (ETFs) topped $100 billion for the first time. 

Senior executives of all stripes thus need to be thinking about how to position their business to attract modern, socially aware investors.

How to create a corporate social responsibility program

Now onto what you really want to know! Here are six steps to building a CSR program for your business.

1. Define what corporate social responsibility means to you

The first step is to figure out where you’re starting from. CSR can mean different things to different people, so engage with your stakeholders from the beginning and make sure everyone’s on the same page. How does your current leadership team define social responsibility? What about your workforce, local community, and customers?

It’s important to build your program around your company’s core competencies. The right strategy for one business could be a total non-starter for another. For example, if you’re a start-up using PRM in marketing, why not leverage the partnerships you already have? 

The crucial thing at this stage is to evaluate your business’s current impact on society. Identify where you’re doing well as well as where you can improve. To do this, it’s a good idea to conduct a formal CSR assessment. 

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2. Carry out a CSR assessment

This should delve into the following areas of responsibility:

  • Environmental 
  • Ethical 
  • Philanthropic 
  • Economic

Here are a few examples.

Most companies are aware of how important it is to engage with eco-friendly solutions in the modern world. Ergo, taking environmental responsibility could include switching to sustainable materials or starting a recycling program. 

The ethical category is concerned with fair business practices. This could cover anything from how your business treats its employees in terms of pay and benefits to making sure all materials are ethically sourced. 

There are so many opportunities for philanthropic giving it can be difficult to know where to start or how to implement it. However, software like Award Force or Good Grants can help you manage the process and make the most of your corporate giving initiatives.

Economic responsibility brings the other three categories together. It’s all about your business making financial decisions that have a positive impact on society. For example, choosing to use a slightly more expensive supplier because of their ethical business practices.

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3. Ensure leadership is supportive

No matter how well-planned your CSR program is, it will fail if the team at the top isn’t behind it. Ideally, at least one senior leader should take on a fully involved role. Day-to-day operational concerns can get in the way of establishing your CSR program, so high-level support is vital to get it off the ground. 

If you’re pitching the CSR program to senior leadership, focus on the positive impact it will have on brand loyalty, customer engagement, and attracting and retaining top talent. Perhaps it could help your company achieve industry recognition (e.g. by winning a trade award or becoming a Gartner Magic Quadrant unified communications leader)? Show them how a CSR program aligns with brand goals. 

It won’t hurt to mention any potential cost savings you’ve identified either.

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4. Develop specific CSR initiatives and set goals

Once you’ve drummed up support, decide what your focus is going to be. Set goals for the first stage of the program that will demonstrate its positive impact on the business. 

You don’t need to go from zero to 100 immediately. Use what you already have as a starting point. Modern comms tech and phone systems for office make it easy to reach out to stakeholders and coordinate your efforts.

Ask your employees for help and advice – maybe some of them are already engaged in socially responsible activities? For example, a volunteering project could go a lot further with company support. That’s an easy win, if so. 

Once you’ve decided which CSR policies are right for your business, begin by creating a project timeline so everyone involved in the planning is aligned and ready to go. 

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5. Launch your program

It’s time to go public. How exciting! You get one chance at a good first impression, so make sure you communicate effectively with:

  • Employees
  • Customers
  • Investors
  • External stakeholders
  • Your social media followers
  • The press

You should be using all the tools available to communicate the goals of your program across the company network, from the most advanced cloud PBX solutions to persuading people with your enthusiasm by the coffee machine.

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6. Measure and refine

If it’s to last, your CSR program will need to develop and be flexible enough to respond to events. It’s crucial to measure its effectiveness in concrete ways, so you can refine your strategy accordingly.

Exactly how you do this will depend on the program you’ve set up. You may find some benefits become obvious immediately – if your Amazon fulfilment stats have exploded because sales have grown in direct response to your initiative, for instance. But the benefits of CSR are not always tangible in the short term, so you may need to use other approaches.

One thing you can do is look at other companies with CSR policies and use them as a benchmark for how yours is performing. Of course, you can always ask for feedback from your employees and customers too.

Sincerity matters

There’s no doubt that the history of corporate social responsibility programs is littered with companies that only launched them as olive branches for bad business practices. But here’s the thing – people don’t buy it anymore. 

Businesses are only now starting to get the message, with more and more senior executives speaking out about the importance of engaging stakeholders in a socially responsible way. Are you ready to join them?

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About the writer 

John Allen is the Director of SEO for 8×8, a leading communication platform with integrated contact centre, voice, video and chat functionality. John is a marketing professional with more than 14 years of experience in the field, and an extensive background in building and optimising digital marketing programs across SEM, SEO and a myriad of services. Connect with him on LinkedIn.

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