Why Corporate Social Responsibility is Important

What is Corporate Social Responsibility?

Corporate social responsibility (CSR) is a broad term used to describe a company’s efforts to improve society in some way.

These efforts can range from donating money to nonprofits to implementing environmentally-friendly policies in the workplace.

Corporate social responsibility is not a mandated practice in the United States; instead, it is something extra that companies do to improve their local and global communities.

CSR is important for companies, nonprofits, and employees alike.

Top CSR Statistics

$17.8 Billion

The amount that corporations gave to charities last year.

55%

Of consumers are willing to pay more for products from socially responsible companies.

65%

Of Fortune 500 companies offer matching gift programs.

93%

Of the world’s largest 250 companies now publish annual CSR reports

Corporate Social Responsibility – How Corporations Benefit

1. Better Public Image

Companies that demonstrate their commitment to various causes are perceived as less selfish than companies whose corporate social responsibility endeavors are nonexistent.

A corporation’s public image is at the mercy of its social responsibility programs and how aware consumers are of them.

Remember, consumers feel good shopping at institutions that help the community. Clean up your public image (and broadcast it to the world!).

Corporations can improve their public image by supporting nonprofits through monetary donations, volunteerism, in-kind donations of products and services, and strong partnerships.

By publicizing their efforts and letting the general public know about their philanthropy, companies increase their chances of becoming favorable in the eyes of consumers.

Takeaway: Positive social responsibility improves a company’s public image and relationship with consumers.

2. Better & More Media Coverage

It doesn’t matter how much your company is doing to save the environment if nobody knows about it.

Make sure you’re forming relationships with local media outlets so they’ll be more likely to cover the stories you offer them.

How much good a company can do in the local communities, or even beyond that, is corporate social responsibility. And the better the benefits, the better the media coverage.

On the other hand, however, if a corporation participates in production or activities that bring upon negative community impacts, the media will also pick this up, and unfortunately, bad news spreads quicker than good news.

Media visibility is only so useful in that it sheds a positive light to your organization.

Takeaway: Having a strong CSR program can increase the chances that your company gets news coverage.

3. Boosts Employee Engagement

Employees like working for a company that has a good public image and is constantly in the media for positive reasons.

Happy employees almost always equals positive output.

Nearly 60% of employees who are proud of their company’s social responsibility are engaged at their jobs.

When companies show that they are dedicated to improving their communities through corporate giving programs (like matching gifts and volunteer grants!), they are more likely to attract and retain valuable, hardworking, and engaged employees.

If a corporation is philanthropically minded, job-hunting individuals are more likely to apply and interview for available positions. Once hired, employees who are engaged will stay with a company longer, be more productive on a daily basis, and will be more creative than disengaged workers.

Takeaway: Corporate social responsibility helps attract and retain engaged and productive employees.

4. Attracts & Retains Investors

Investors who are pouring money into companies want to know that their funds are being used properly.

Not only does this mean that corporations must have sound business plans and budgets, but it also means that they should have a strong sense of corporate social responsibility.

When companies donate money to nonprofit organizations and encourage their employees to volunteer their time, they demonstrate to investors that they don’t just care about profits.

Instead, they show that they have an interest in the local and global community.

Investors are more likely to be attracted to and continue to support companies that demonstrate a commitment not only to employees and customers, but also to causes and organizations that impact the lives of others.

Takeaway: Investors care about corporate social responsibility and so should companies.

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Corporate Social Responsibility – How Nonprofits Benefit

1. Funding Via Matching Gift Programs

Corporations that offer matching gift programs essentially double the donations that its employees are giving to eligible nonprofits.

What more could an organization want?

Truthfully, matching gifts are a bit more complicated than that.

Each company has a different set of guidelines, deadlines, and requirements that must be met before they’ll match an employee’s contribution to a nonprofit.

However, the opportunity to receive twice as many donations still hangs in the air for organizations looking to benefit from corporate social responsibility programs.

Takeaway: Matching gift programs have the potential to double, and sometimes even triple, an organization’s fundraising revenue.

2. More Volunteer Participation

Corporations that offer volunteer grants are bringing in helping hands to eligible nonprofit organizations.

A corporation with this kind of program might offer (for example) $250 to a nonprofit once an employee has volunteered at least 10 hours with the organization. There are also pay-per-hour grants that many corporations offer that pay a certain amount per hour volunteered.

This kind of socially responsible program is a win-win for every party involved. Employees of corporations are seen volunteering and donating their time to important causes in the community, and nonprofits are receiving free time and volunteer work, which is essential for the success of so many nonprofits.

Takeaway: Volunteer grant programs are a crucial component of CSR that bring in more revenue and volunteer time for nonprofits.

3. Forging Corporate Partnerships

Yet another positive impact corporate social responsibility has on nonprofit organizations is the possibility of corporate partnerships.

These partnerships are vital to the work a corporation can do in the local community, and important to a nonprofit that may not have the resources for major marketing campaigns.

For a nonprofit organization, a partnership with a local or national corporation puts its name on tons of marketing materials that otherwise could not have been afforded on tight budgets.

A key benefit is the partnership brings additional awareness to the nonprofit’s cause.

Takeaway: CSR brings nonprofits and companies together, creating strong partnerships between the two.

4. Varied Sources of Revenue

Nonprofits cannot solely rely on individual donations for support.

Granted, individuals make up roughly three-fourths of an organization’s total monetary contributions, but this doesn’t mean that nonprofits should discount corporations and businesses as viable sources of revenue.

In fact, companies with strong corporate social responsibility programs are looking for nonprofits to be the recipient of grants, matching gift programs, and volunteer grant programs.

CSR initiatives can help nonprofits make up that left over 25% after they’ve looked to individual donors.

Takeaway: Corporate social responsibility programs can be another source of revenue for nonprofits.

Corporate Social Responsibility – How Employees Benefit

1. Positive Workplace Environment

When corporations exhibit philanthropic behavior, they are more likely to provide employees with a positive workplace. Consequently, employees feel engaged and productive when they walk into work each day.

Instilling a strong culture of corporate social responsibility within every employee from the top down will help to create a positive and productive environment where employees can thrive.

Corporations that care about the lives of people outside the walls of their businesses are more likely to create a positive environment.

Takeaway: Business environments are more enjoyable when companies engage in corporate social responsibility.

2. Increase in Creativity

Employees who know that their employer is committed to bettering the local and global communities feel a stronger connection to the company. Because of this close relationship that employees share with their company, workers feel more inclined to be productive and creative.

Employers have identified creativity as one of the most important leadership qualities that an employee can possess. Creative employees enjoy working for companies that they can believe in and stand behind.

By incorporating comprehensive philanthropic programs, companies can help employees become more productive and creative.

Takeaway: Companies that maximize their social responsibility potential foster innovative and creative employees.

3. Encourages Professional & Personal Growth

When companies have a culture of corporate social responsibility, they can easily promote volunteerism to their employees and encourage them to donate to nonprofits.

When employees contribute their time and money to worthy causes, they develop professionally and personally.

By helping those in need and volunteering as teams, employees learn to work better together on important projects. Employees also experience a sense of pride when they know that they work for a company that cares about the community and encourages them to be passionate about worthy causes.

Takeaway: Employees are able to professionally and personally develop as a result of corporate social responsibility.

4. Promotes Individual Philanthropy

When employees notice that the company they work for is involved in charitable endeavors, they play follow the leader and begin to engage in their own philanthropic activities.

If a company encourages group volunteerism and matches donations to nonprofits with a matching gift program, an employee is more likely to take advantage of those programs and become more individually philanthropically minded.

Without the strong sense of CSR that a company should adopt, employees are less likely to branch out themselves and serve the community with monetary donations and volunteer efforts.

Takeaway: Employees become more philanthropically aware when they work for companies that are socially responsible.

Top CSR Consulting Firms

Anthesis

Anthesis is a global consultancy that offers commercially-driven sustainability strategies to corporations.

They successfully combine the reach of big consulting firms with their own expertise. Anthesis gives companies with a wide array of services and assists them in goal-setting.

If your company is looking to boost its environmental sustainability initiatives, the people at Anthesis are the perfect fit.

Realized Worth

Realized Worth works side-by-side with companies that want to implement great corporate giving and volunteer programs.

Realized Worth has been working since 2008 to help companies across the globe develop their corporate social responsibility through comprehensive giving programs.

Realized Worth helps with program design and implementation, as well as policy development, toolkit design, research, and more!

Cause Consulting

Cause Consulting is a strategy and communications firms that helps companies grow their business and impact society.

The folks at Cause Consulting help companies and businesses of all sizes create comprehensive CSR strategies, processes, and best practices while branding the company’s efforts.

They have worked with local, national, and even global businesses, strengthening reputations and building brands along the way.

Expert Advice for Corporate Social Responsibility Programs

Sarah Grazier

Make sure your CSR initiatives tie back to your company mission and align with your brand identity. It can be tempting to support a wide variety of nonprofits, but it is more powerful to pick a few core focus areas in which to make a significant impact.

Sarah GrazierVP, Strategic CommunicationsCalypso Communications
Ann Charles

A CSR strategy begins with a long-term vision and commitment from the top of the executive food chain. The CEO’s vision should be shared through social media channels so supporters can engage with the brand, provide feedback, and become evangelists.

Ann CharlesFounder & CEOBrandFog
Lain Hensley

Use digital tools to engage employees in the idea-generation process. Ask them what they want the company to take on to give back to the community.

Lain HensleyCOOOdyssey Teams
Liz Maw

Communities are grappling with problems that are global in scope and structurally multifaceted — Ebola, persistent poverty, climate change. The business case for engaging in corporate social responsibility is clear and unmistakable.

Liz MawCEONetImpact
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