Building a Socially Responsible Business: 4 Hurdles You Need to Overcome

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Wednesday, March 18, 2020

Recognizing and overcoming obstacles to corporate social responsibility can help you realize benefits such as stronger brand loyalty and a more engaged workforce.

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Corporate social responsibility (CSR) is taking on more importance for businesses with each passing year. There are many benefits to be gained from demonstrating your commitment to socially responsible, ethical practices that look beyond the interests of your own organization.

Research has identified various business advantages that can be linked to CSR.

  • Companies with a clear sense of purpose are up to 50% more likely to successfully expand into a new market
  • 50% of millennials would take a pay cut to find a job that matches their values
  • Employees who donate to charities through their workplace are happier than those who don't have this option

As worthwhile as it is for all companies to commit to CSR, it's important to recognize the obstacles you're likely to encounter in this space.

1. Executive buy-in

Gaining the support of the C-suite is obviously crucial to the viability and success of any CSR initiative.

Recognition of the need to become more socially responsible will vary across companies, but in some cases, executives will need to be convinced of the business case for investing time and budget in this cause.

The HR department can contribute to greater understanding by collecting hard data on the workforce benefits that can be gained from a stronger commitment to CSR.

Being able to present clear facts and figures that support your argument will make it easier to secure the executive support and financial backing required to get any new projects up and running.

There are signs that businesses are moving in the right direction as far as CSR is concerned. One of the conclusions in Deloitte's 2020 Industry 4.0 Readiness Report was that pressure from internal and external stakeholders is driving firms to re-evaluate their processes to show a positive impact on society.

"Our research shows a growing understanding that business must have a purpose beyond profit." - Richard Houston, Deloitte UK senior partner and chief executive
 

2. Getting the workforce onboard

It's not just executives and decision-makers at the top of the business who might need some convincing before getting fully behind new CSR projects and investments. The HR team might find it has to overcome doubts and cynicism across the workforce before making any major changes on this front.

If recent research is to be believed, it's certainly true that younger workers (particularly millennials) are committed to the belief that businesses need to be more socially responsible. But any company-wide initiative will need the support of all staff and stakeholders to be truly successful.

Studies have shown that while three-quarters of millennials would be willing to accept less pay to work for an environmentally responsible employer, less than half of people across all age groups would be prepared to do so.

Only 17% of baby boomers said they had chosen a job in the past because of the company's sustainability performance, compared to nearly 40% of millennials.

It's important to be aware of these generational and ideological differences when coming up with a CSR strategy. Failing to take all views into account could lead to some employees feeling alienated and overlooked.

3. The sustainability challenge

Environmental performance and sustainability are at the heart of CSR and have never been more crucial for businesses. However, it's important to recognize the challenges many companies face on this front, most notably:

  • Coming up with a clear idea of what sustainability means and looks like for the organization
  • The disruption and cost that can occur when you move away from established but inefficient legacy processes and technologies
  • Making the business case for sustainability
  • Acknowledging that a true commitment to sustainable principles like 'reduce, reuse, recycle' could involve encouraging customers to buy less

For many businesses, the best policy could be to start small. Implementing relatively quick and easy changes can put you on the right course to long-term sustainability and help change workforce attitudes and behaviors over time.

4. Going through the motions

One of the potential risks associated with CSR initiatives is people thinking you're simply 'going through the motions' - viewing the project as a short-term marketing exercise or a 'quick win', without having any real commitment to a particular cause or goal.

This could have the opposite effect to the one you intended, with questions about the real motivations behind the company's CSR efforts damaging perceptions of your brand.

One way to reduce this risk is to support charities or causes that have a clear connection to the company. Blindly sending donations or claiming associations with organizations that have no relation to your own might come across as perfunctory box-ticking.

It's also important to distinguish your CSR activities from your general marketing. CSR should be viewed as a long-term commitment, not an attention-grabbing gimmick, and if you get your strategy right, the brand benefits will appear organically.

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