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Is corporate social responsibility (CSR) the new bottom line? Here’s why I think it is

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As a global community, we’re facing a raft of social issues, that only seem to be increasing. As a corporate community, it’s our job to ensure we’re taking responsibility.

Corporate social responsibility (CSR) has certainly taken its place in today’s corporate world. In fact, it’s more important than ever.

A recent study, conducted by research and consulting firm IO Sustainability, has shown that SMEs who are able to identify an area of social impact that is a match with its core strategy, products and services, reap multiple financial benefits, including an increase in sales and productivity by as much as 20% and 13% respectively.

The Australia Giving 2019 Report, recently released by Fundraising and Philanthropy in Australia found that 35% of Australians have volunteered in the preceding 12 months and the 18-24 year old bracket are more likely to volunteer than any other. According to Good2Give CEO, Lisa Grinham, it’s encouraging that the younger generation is coming through, identifying that the “younger generation really want to feel connected to the companies that they are working with; they want the purpose of the company to go beyond just making money.” This gives those companies who are willing to integrate an area of social impact into their core operations a significant advantage over others who are not.

While everyone has heard about CSR, and most know the importance of having a robust CSR plan, it’s important to fully understand what it all means.

What is CSR?

In simplest terms, corporate social responsibility is the way an organisation takes ownership of its decisions and activities, and how the organisation’s behaviour impacts society and the environment. It’s all about ethical behaviour that is consistent with sustainable development and the welfare of society.

Whether it’s via charitable donations, helping out a cause close to the organisation’s heart or helping the environment, companies that implement a CSR strategy come off better in the long run. Remember, in today’s climate, with tales of shocking and unethical behaviour coming to the fore, customers are questioning which organisations can be trusted. That’s why it’s important to show your CSR, rather than merely talk about it.

Why being responsible is key

Larry Fink, CEO of BlackRock, a firm that manages $US6.3 trillion in assets, is a big believer in corporate social responsibility. Early in 2018, he sent a letter to CEOs of public companies, warning them to be accountable for their societal impact. “Society is demanding that companies, both public and private, serve a social purpose,” he wrote, stressing the need to demonstrate how they plan to handle the company’s effect on the world, or risk, essentially, everything.

This belief is echoed by many others around the world, and in Australia, especially with the younger generation. While many charities would believe they need to rely on the older generation for monetary and voluntary support, it’s actually the youngest generation is that is proving their worth – it’s ingrained in their to give back. And they expect that from the companies they work for and buy from. In fact, more than half of the respondents for Neilsen’s Corporate Social Responsibility survey said they would be willing to pay more for products and services from companies that are committed to positive social impact.

Trust and ethical behaviour now rate highly for consumers, they are more educated about CSR and are willing to vote with their feet. Unless organisations are putting emphasis on CSR their relevance and performance will start to diminish.

Let’s get inspired

There are dozens of big companies out there handling their CSR duties well. Google is a notable example, having implemented a number of ‘green’ techniques, such as Google Sustainability, which, in their words raises “the bar in making smart use of Earth’s resources, expecting the highest ethical standards throughout our supply chain, and creating products with people and the planet in mind.”

The ABC is also a good example, delivering products and services with ethical, financial and audience responsibilities in mind. The broadcaster specifically pursues environmental and socially responsible business practices by protecting the environment, contributing to the community, respecting human rights and reporting on performance.

Here, at State Schools’ Relief (SSR), we’ve worked with our corporate partners to implement initiatives that not only benefit the mission of our organisation, but also align with our partners’ CSR strategies. One example is the initiative of providing STEM calculators to students who cannot afford to buy them. This strategy aligned with the bank’s CSR framework as it focused on enabling students to continue with STEM subjects, and perfectly aligned with SSR’s mission to remove barriers to education for underprivileged young people in Victorian state schools. How did we make this happen? We explained our goals and mission to Bank Australia, who then identified how these aligned with their CSR strategy.

Another example is our iPads for non-verbal children initiative, which SSR launched in 2018. In order to make this happen, we spoke to our corporate partners to see whether there was any alignment between the project and their CSR principles. In the case of Bankfirst, who funded the program along with a philanthropic trust, the program resonated with their CSR strategy. Why? Their customer base is predominantly in schools, including specialist schools. Perfect match! The program addressed Bankfirst’s CSR strategy and also had an impact in the school sector where much of their customer base worked.

Making it happen

Implementing a robust CSR strategy is important. Here are five steps for getting it done.

  1. Tap into your key stakeholders. Find out what is important to them and then align your CSR strategy to those key priorities.
  2. Engage your staff in the process and make it creative rather than compliance driven. The best CSR strategies are those which have deep and lasting social impact.
  3. Find the right partners. If the CSR strategy is aligned with the organisational values the initiative will resonate with partners who want to be a part of it.
  4. Get excited about it! Making a difference should resonate throughout the organisation, from the top down, so ensure it’s promoted and celebrated at every opportunity. After all, both staff and customers want to align with companies who are making a difference and not just focused on the bottom line.
  5. Start small. Look at what you can do internally and then branch out to the local community to see where you can have the largest impact. Make sure that your CSR strategy is authentic and resonates with both your staff and stakeholders.

Sue Karzis is the first female Chief Executive Officer of State Schools Relief, a Victorian based not for profit organisation that supports the needs of financially disadvantaged school students by providing them with new school uniforms, footwear and educational resources during times of vulnerability. Since her appointment, Sue has propelled the charity to record numbers of impact, assisting over 56,000 financially disadvantaged Victorian school children in 2018 alone and has set the goal of positively impacting 70,000 underprivileged Victorian school children in 2019.

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