Corporate Social Responsibility (CSR): The evolution of Corporate Social Responsibility and why you should integrate it into your digital marketing strategy.

What you will learn:

1.   What is the Corporate Social Responsibility?

2.   How is CSR different to Brand Activism?

3.   The evolution of Strategic Corporate Social Responsibility.

4.   Five Corporate Social Responsibility facts and statistics.

5.   Four of the biggest and future trends to align your Corporate Social Responsibility.

6.   How to align your Corporate Social Responsibility with your business?

7.   Bottom Line.

What is Corporate Social Responsibility (CSR)?

Corporate Social Responsibility (CSR) refers to the obligations that a business has not only to create value to its shareholders, but to also act in a way that benefits the broader community in which it operates.

While the concept has been around for decades – historically as a result of religious moral obligations towards society, the wealthy funded orphanages and schools – its importance and meaning has grown in recent years as consumers have become more conscious of issues like climate change, gender rights, income inequality, and health care disparities.

This increase in consumer awareness, has led to businesses embracing CSR practices, traditionally broken into four categories: environmental, philanthropic, ethical, and economic responsibility, and gradually realising the benefit of incorporating them into their marketing efforts.

How is CSR different to Brand Activism?

Put short, Brand Activism, is defined as a business strategy intended to affect the corporation’s reputation positively, so that customers want to buy their products and work with them.

In distinguishing between the two, Brand Activism is mainly a business strategy for profits, whereas CSR is a broader concept which considers the effects that CSR activities have on society, not with the direct intention of making a profit.

While one may consider CSR different to Brand Activism, in reality, it isn’t, at least in 21st century society.

Dr Jackson Yin, Managing Director of iBuild, says, “In our marketing strategy, we proudly highlight the CSR that we host 100 university interns each year from eight universities including Melbourne and Monash University across multiple disciplines including engineering, business, marketing, and arts. This has contributed to the skills and employability of more than 300 Victorian students in the past few years.

Further, it is part of our talent acquisition strategy to hire selected high performing interns into graduate positions.

Moreover, this strategy has helped us win more customers including both consumer, business and government customers, due to the goodwill and commitment demonstrated by iBuild to improve young students skills and employability.”

The evolution of Strategic Corporate Social Responsibility

With consumers demanding corporations make social issues part of their strategies, and be transparent about it, companies now have a new role within society, giving rise to a new interpretation of CSR into Strategic Corporate Social Responsibility (SCSR).

According to a paper published in 2019, in the International Journal of Corporate Social Responsibility, which explores the evolution of CSR, it clarifies how CSR becomes strategic, when it is part of the company’s management plans for generating profits.

Overall, the changing face of consumer awareness has left no room but for CSR to become strategic. Below are some of the key-ways CSR has evolved and helps a business grow:   

·       (2007), a survey of 110 top managers of Spain’s largest companies found out that visibility, appropriability, and voluntarism were considered the main strategic dimensions of CSR, and they were linked to the creation of value (even when voluntarism is not part of their definition of SCSR). Their findings show that visibility, in terms of the presence of CSR on the media as well as a positive image of the company, can be linked to the creation of value through increased customer loyalty and the attraction of new customers, as well as developing new areas of opportunity for products and markets.

·       (2008), an analysis of 21 exemplary CSR practices observed that seven common principles guide the strategic CSR approach of the selected companies: cultivate the needed talent, develop new markets, protect labour welfare, reduce the environmental footprint, profit from by-products, involve customers, and green the supply chain.

·       (2011), the need for Creating Shared Value (CSV) is in part the result of the conventional narrow-viewed business strategies which usually don’t take into account the broad factors that influence their long-term success…. Notably, Porter and Kramer place CSR into this category seeing it as an outdated and limited concept that has emerged as a way for improving company’s reputation, and as a consequence, they claim that CSV should replace CSR.

·       (2012), a case study of Vattenfall, the Swedish state-owned energy company that in 2008 launched a CSR-backed stakeholder engagement campaign focused on climate change mitigation, showed that even when Vattenfall’s campaign addressed clear social and global issues (climate change), it still reflected typical business objectives (in this case creating an interest in the company’s environmental effort and creating a brand image linked to the fight to climate change that would be a first-mover competitive advantage)

·       (2016) the evolution of CSR and its growing acceptance, is central to a company’s strategic decision making, as well as to their day-to-day operations.

·        (2021) Environmental corporate social responsibility in building green competitive advantage and company image. Green concern is making a profound impact on building green competitive advantage (GCA) across the globe.

Five Corporate Social Responsibility facts and statistics

1. An estimated 90 percent of companies on the S&P 500 index published a CSR report in 2019, compared to just 20 percent in 2011.

2. Companies with a clearly defined sense of purpose are up to 50 per cent more likely to successfully expand into a new market, thus grow faster.

3. More than half of millennials would defend a purpose-driven company if people spoke badly of it.
4. Employees who have a chance to give to charities through their workplace are happier than those who do not.

5. Of 53 companies surveyed, almost all companies (79%) offered a 1:1 match for disaster relief giving.

Four of the biggest examples and future trends to align your Corporate Social Responsibility with are:

1.  Green initiatives: Becoming an environmentally aware business can give you a competitive advantage.

In 2015, the UN Sustainable Development Goals (SDGs) were created to achieve a prosperous, inclusive, and sustainable society for all by 2030.

According to a 2017 Business & Sustainable Development Commission report, the SDGs intention is to generate $12 trillion in business savings and revenue across four sectors (energy, cities, food and agriculture, and health and wellbeing) by 2030, while increasing employment by up to 380 million jobs.

This positions SDGs as important drivers for business growth but also vital to attract investors and consumers.

Global research by PwC found that 78% of customers are more likely to buy goods and services from companies that have committed to the SDGs.

2. Women’s gender and financial equality: One of the most significant methods of promoting gender equality in the workplace comes from within the company culture. Company culture forms the basis of behaviour at all levels within the company and is more important to changing workplace attitudes than many business leaders might believe.

The United Nations Women’s Empowerment Principles, includes gender balance in the workforce, paid parental leave benefits, and transparency around pay and sexual harassment policies.

According to a Nielsen survey, 45 per cent of conscious consumers said that companies should support and they would buy from a company that promotes gender equality and supports women.

3. Inclusivity: In response to the inhuman killings of African American and Black people in 2020 and the social unrest that followed, many companies, some for the first time, either directed or increased their donations towards supporting black initiatives.

Equally consumers prefer to buy from black-owned businesses and support Indigenous companies.

This trend will continue and possibly accelerate in the years to come.

4. Plant-based food companies: The plant-based food sector has been thriving in recent years and will continue right into the future.

Plant-based companies in the U.S. raised $741 million in the first three months of 2020, suggesting that investors are becoming more and more interested in helping the sector thrive.

In Australia, retail sales of plant-based meat surged 46 percent in the year to June 2020, with the number of new jobs more than doubling (106 percent growth) in the emerging sector, and manufacturing revenues increasing from $35 million to nearly $70 million.

How to align your Corporate Social Responsibility with your business?

Both large and small companies wishing to weave the goals and actions into business operations and organizational strategy can begin with a few key steps.

 Step one:

In considering your where your efforts should be focused, a starting point can be to ask:

·       Where does my company realistically have the potential to achieve the most progress and success?

·       How can my organisation have the most impact?

By aligning your company with social responsibility, you can turn global challenges into business opportunities, while contributing towards a better world.     

Step two:

Once you have identified your goals, the next logical step is to align your business activities with these goals. Focus your strategy in one areas will help maximise impact and create a strong positive impact.

To achieve your goals, it may require that you collaborate with others, transform the internal culture of the company, or even develop new business models, products or services to drive progress towards achieving those goals.  

 Step three:

Remember that communicating your social strategy and subsequently your results publicly, will strengthen trust in your brand. Transparency and accessibility to information, from both internal and external stakeholders is critical to ensuring future growth and business success.

Bottom Line:

Over the next years our global community faces many challenges, and socially responsible businesses can play a crucial and vital role towards a sustainable and more humane future, through their CSR efforts.

Unlimited opportunities exist to both grow your business and be successfully while simultaneously tackling some of the biggest issues of our time.

Moving forward if you don’t have a social impact, you risk staying behind in both investment and new market opportunities, including attracting new customers.

Taking the above mentioned three steps and finding inspiration from existing corporate socially responsible business examples, can help you gain new investment, market share, and increase in profits all while making a positive impact on the world too. And that’s a great brand to build and leave as a legacy!