Corporate social responsibility (CSR) is a concept with many interpretations. The way it is understood and executed differs greatly for each company. Despite varying definitions and practices, one thing is universally understood: CSR programs are becoming an essential component of business in today’s world. Here are the top 5 reasons why more and more companies are implementing CSR initiatives.
1. Fosters Goodwill in the Community
Giving back to local causes creates a sense of mutual support between your business and the surrounding community members. Investing in the community is ultimately an investment in your company and results in a “If you have our back, we’ll have yours” mentality. Setting up employee volunteer programs is a great way for company representatives to connect with community members. Some companies will even offer their employees volunteer days as part of their PTO packages, providing even more incentive to be active in their community.
2. Boosts Reputation
Corporate giving and employee giving programs are great ways to enhance a company’s visibility while creating a reputation for doing good. The key to achieving these results is open communication between a company, it’s employees, and the public. Publishing annual reports on CSR programs and issuing press releases about major partnerships, initiatives or events are two good ways to spread the word.
3. Attracts Investors
Investors are more likely to be attracted to and continue to support companies that demonstrate a commitment to charitable causes that impact the lives of employees, customers, and the local and global communities. In fact, a recent study revealed 83% of professional investors are more inclined to invest in a company well-known for its CSR, viewing such initiatives as an indicator of greater transparency and honesty in operations and financial reporting, resulting in lower risk.
4. Increases Revenue
In addition to expecting quality products and services, many customers are more likely to buy from a socially responsible company. One study found that 55% of global consumers will pay extra for products and services from companies committed to positive social and environmental impact. In other words, doing good things is good for your business.
5. Boosts Employee Engagement
Good people are at the heart of every good corporation, and smart executives recognize that each dedicated member of their workforce is a brand ambassador. CSR is expanding to include creative programs designed to engage employees in the company as a whole. Corporate gift matching, dollars for doers, volunteer days, and student mentoring programs strengthen an internal sense of community and build employee loyalty, all while contributing to the greater good at the core of CSR initiatives.
Essentially, the socially-conscientious consumer market segment is growing. Aided by social media, consumers are pushing companies to be more ethical and transparent in their business practices. In addition, this generation of employees are becoming more and more socially conscientious and want to make sure that they work for a company that shares their values and facilitates ways for them to make an impact.
