Making CSR initiatives count
Corporate Social Responsibility (CSR) is now widely accepted as a worthwhile business priority, with more and more organisations prioritising it as a key focus for their business, rather than viewing it as simply a soft arm of their marketing efforts. Corporate leaders are, increasingly, engaging with the drive to make their organisations sustainable, while workforces at large are far more involved with particular CSR activities and broader CSR goals.
This acceptance of CSR as a business goal is, in part at least, based on the understanding that investing in the social performance of an organisation also bolsters its overall financial performance. Whether it springs from greater community engagement, positive public relations or improved stakeholder relations, the general understanding is that being a “good company” also means being a profitable one.
There is certainly research that supports this assertion, although one interesting academic study by Barnett & Salomon (2011) suggested that the connection is not necessarily linear. Instead, their results found that relationship between corporate social performance and corporate financial performance was U-shaped. This means that, while the highest financial performance was attained by those investing most in CSR, there was a drop off in financial performance between those investing moderately from those not investing at all.
The conclusion that might be drawn from this study, then, is that companies which commit to CSR initiatives but don’t really commit (in terms, for example, of stakeholder engagement) are actually better off – from a business perspective - doing nothing. This is hardly a great conclusion if you look at it from the perspective of trying to make a positive social difference.
Realising CSR goals
Companies that want to fully realise their CSR goals should, therefore, not approach the topic in a haphazard and half-hearted way. Instead, they should strategically look at what, as a whole, their business wants to achieve in terms of social goals, and identify how those efforts can generate wider business value.
Making sure this happens means businesses should also be focusing on measuring the impact of their activities. Finding the metrics and measurements that can evidence cold, hard business impact is the best way to tie CSR goals to corporate strategy, thereby supporting a company in making CSR goals align nicely with business targets.
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