The Top 7 Benefits of Having a Corporate Social Responsibility Program
Corporate social responsibility (CSR) is no longer a nice-to-have; it’s a need-to-have. Businesses, small or large, are expected to lead the way in creating a progressive CSR program that gives back to people and the planet.
Yet, initiating a CSR program can be tricky to do.
Winning executive buy-in, assigning responsibilities and finding the right CSR software are some of the biggest hurdles to jump — that’s before you’ve even mapped out the details.
We’re here to help you jump those hurdles. We’ll explore some of the benefits a CSR program can bring for businesses, from talent attraction and retention to increased revenue and brand value, and we’ll celebrate some of the companies paving the way.
You can hear more about the benefits of having a CSR program on The Social Impact Show by Benevity, with CSR expert Nicole Campbell:
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What are the benefits of CSR?
We’ll cover the top seven benefits of having a CSR program, including:
- Increased employee engagement
- Better bottom-line financials
- More support for local and global communities
- Increased investment opportunities
- Press opportunities and brand awareness
- Increased customer retention and loyalty
- A stronger employer brand
1. CSR increases employee engagement
Extensive research proves that CSR and a strong sense of employee purpose actively contribute to increased employee engagement.
That’s important because when a company has engaged employees, they see a 17% increase in productivity, are 21% more profitable and can have 41% lower absenteeism. Innovation also increases in an engaged workplace.
Translating this into financials, disengaged employees cost businesses between $450 and $550 billion annually.
Giving back to the community is a virtuous circle in which engaged employees are enriched by volunteering opportunities that further engage and encourage them.
2. CSR increases revenue
When you’re trying to win buy-in from leadership for your CSR program, it often falls to financials. Stakeholders want to know if this project will see a positive return on investment (ROI).
Companies investing in social purpose have a 6% higher market value and generate 20% more revenue than companies that don’t invest in social purpose, according to Project ROI.
3. CSR supports local and global communities
For all the fantastic benefits your business gets from showcasing your CSR initiatives, it can be easy to overlook its reason for being in the first place. CSR gives people the leverage and the platform they need to make a difference in local and global communities.
Companies are often collections of like-minded, talented people working toward a broader vision. If you can develop a CSR program that’s in line with your company’s values, then your business truly has the opportunity to create a substantial positive impact.
TOMS is a fantastic example of how a product-led CSR initiative can support global communities.
The TOMS CSR initiative drives their company mission and is at the forefront of their product.
The shoe brand has positively impacted lives globally with donations of 100 million pairs of shoes, committed $6.5 million to impact grants and provided over 700,000 weeks of safe water. Now imagine the impact we’d see if more major brands followed suit.
4. CSR increases investment opportunities
Today, global sustainable investment stands at over $30 trillion worldwide — up 68% since 2014 and 10x since 2004.
At the beginning of 2020, BlackRock Chairman and CEO Larry Fink echoed this in his letter to CEOs, arguing that climate change has become a defining factor in corporations’ long-term prospects.
The letter explains how the $7 trillion investment firm will shift toward sustainable investing, putting it on par with financial returns.
“While governments must lead the way in this transition, companies and investors also have a meaningful role to play.”
Larry Fink, BlackRock Chairman and CEO
BlackRock isn’t the only investment firm making changes. Marshall Wace targeted $1 billion for a brand new green hedge fund that aims to trade shares based on ecological and moral qualities.
5. CSR presents press opportunities
Impactful CSR can win you excellent press coverage. Creating a CSR program that gets you noticed could lead to a boost in your brand awareness and overall online brand affinity.
However, be cautious about the why behind your CSR efforts.
CSR that’s not authentic is considered greenwashing; if your CSR initiative seems too out of line with your mission and values, people can question its purpose, even if it comes with good intent.
Research has shown that employee beliefs behind CSR initiatives can impact workplace attitudes, trust in top management, organization pride, job satisfaction and even performance. Your employees are your biggest brand ambassadors — so, lead with authenticity, and authentic press opportunities can follow.
6. CSR increases customer retention and loyalty
Excellent CSR gives a company a chance to showcase consistency and win loyalty, which ultimately converts into customer retention and increased sales. It dates back to Cialdini’s six principles of persuasion and proves to be a fantastic way for businesses to showcase they’re trustworthy.
Research shows that 87% of Americans are more likely to buy a product from a company that they can align their values with, and over half of all consumers are willing to pay extra for a product if they’re buying from a company with a sturdy CSR strategy.
7. CSR helps attract, retain and develop talent
Last on our list, but certainly not least, is the employer branding benefits that good CSR initiatives can generate.
It can be a struggle to attract and retain talent. Still, research has shown that 82% of Gen Z workers consider CSR a significant factor when deciding on their next employer, and 66% would consider a pay cut if it meant working for a more socially responsible company.
It’s a similar story for millennials, with 82% considering CSR efforts when deciding where to work, and 70% willing to take a 30% pay cut to work for a company with strong social values, according to Cone Communications.
However, it doesn’t stop at the younger generations. LinkedIn found that 75% of candidates research a company’s online reputation before applying for a role.
Plus, Corporate Responsibility magazine found that 75% of Americans would not take a job with a company with a poor corporate responsibility reputation.
Benevity's own research shows that companies with CSR programs where their people are actively engaged in giving and volunteering saw a 57% reduction in turnover for those employees.
@benevity How corporate purpose and #csr key to attract, hire and retain employees. #employeeengagement #corporatesocialresponsibility #greatresignation #racialjustice #diversityequityandinclusion #dei #corporateresponsibility ♬ Inspirational Music - AZOVMUSIC
Need more convincing? 92% of all employees would consider leaving their role if presented with an offer by a company with an excellent corporate reputation.
Social impact is also a way you can grow and develop your talent.
A company’s strong volunteering program, especially a skills-based volunteering program, can give employees an opportunity to develop and hone skills.
According to a Deloitte volunteer impact study, 92% of respondents agreed that volunteering actually improves their employees’ broader professional skill sets.
92% also agreed that volunteering is an effective way to improve leadership skills. And 80% said that active volunteers move more easily into leadership roles.
3 businesses using CSR to benefit growth
Now that you know some of the benefits of CSR initiatives, let’s dive into a few brands that do it best.
Google – The reactive CSR initiative winning at employer branding
The #BlackLivesMatter campaign highlighted the injustices Black-founded business owners face every day.
A study revealed that just 1% of venture-backed business founders were Black, compared with 77.1% who were white. And only 9.2% of those founders were women. Numbers like these saw industry giants such as Google react with CSR initiatives — and be applauded for it.
In 2020, Google announced startup accelerators for Black- and women-led businesses and invested $175 million toward economic opportunity for Black business owners, founders and job seekers.
Google’s commitment to racial equity landed them some excellent press coverage. Overall, Google’s efforts supported their corporate responsibility and employer brand reputation, helping them win more qualified applicants.
Johnson & Johnson – The skill-sharing CSR initiative winning at employee engagement
In Switzerland, Johnson & Johnson’s employee engagement program, Talent for Good, saw eight skill-sharing missions across four NGOs implemented with Alaya by Benevity.
This effort to do good has resulted in huge interest from their Swiss team, a constant stream of applications and positive feedback.
It’s also helped employees develop their professional skills — doubling down the benefit for employees and nonprofits.
LEGO – The global impact CSR initiative winning customer loyalty
Ranked as the world’s most reputable company in 2020 by RepTrak, the children’s building blocks brand continues to go from strength to strength. The LEGO Group is the perfect example of how you can turn any business model into a purpose-driven, sustainability-oriented enterprise.
The company focuses on three core areas: children, the environment and people. The LEGO Group is continually finding innovative ways to give back to and support these areas.
“Every day, employees at The LEGO Group are empowered to make decisions to do what’s right for children, our fans, our partners, the environment, and our local communities.” — Niels B. Christiansen, CEO.
Their mission to do what’s right for the planet has not only landed them the accolade of world’s most reputable company, but it’s also earned them substantial customer loyalty. 57% of consumers say they would buy from The LEGO Group, a net result of over 13 percentage points higher than other top-ranking reputable companies.
Approach CSR with authenticity
As we’ve explored, there are so many benefits strong CSR initiatives can bring to businesses.
It largely depends on business goals and growth strategies — these determine what a CSR plan will look like for a brand.
Remember to implement your CSR initiatives with authenticity and in alignment with your broader mission and vision. In doing so, you’ll win press — sure, engagement — great, but more importantly, you’ll win hearts by doing good — one act at a time.
Corporate Social Responsibility FAQs
What are 7 main benefits of corporate social responsibility (CSR)?
- Increases employee engagement
- Increases revenue
- Supports local and global communities
- Increases investment opportunities
- Presents press opportunities
- Increases customer retention and loyalty
- Helps attract, retain and develop talent
What are some examples of CSR?
- Some leading examples of companies with great CSR programs are:
- Google’s racial equity initiative
- Johnson & Johnson’s skill-sharing program
- LEGO’s environmentally friendly initiative