The Gillard government’s recent carbon tax has tossed corporate social responsibility (CSR) under a glaring spotlight, forcing big business to be accountable for any environmental damage their industrial processes wreak. However you feel about it, the initiative provides an eye-opening case study of what happens when CSR is enforced, instead of coming from the heart. It will be interesting to see how those companies in the firing line respond — will they really investigate more sustainable ways of operating or will they literally pass the buck onto consumers through hiked-up prices? But that’s not the purpose of this blog post. Instead, I want to consider how CSR, often thought of as “giving back” or “being a good neighbour” applies to small business and how a genuine desire to “do the right thing” can benefit both the world and your business.
A brief history lesson
CSR became popular in the late ‘60s and early ‘70s when many of those household-name multinational companies, such as Nokia, Walmart and Nestlé, formed, incorporated or expanded. In a time of idealism and great change in the western world, a policy that encouraged companies to be answerable to their actions and make a positive impact on the community was appealing. For individual businesses, CSR became an opportunity to develop an ethical framework, to say, “This is what we believe in and value.” At the same time, it signalled a change in how people perceived business — people swapped the idea of simply wanting to make stacks of cash for the idea that running a business is about choosing what kind of world we want to live in.
Let’s get cynical
It’s easy to feel skeptical when you hear the words “multinational companies” and “giving back” in the same sentence, especially when you read about the perks some CEOs enjoy — unfortunately, CSR can seem more like an empty publicity tool than genuine giving these days. However, a good written plan, a few benchmarks and solid review process will make sure your CSR plan walks the talk, instead of languishing at the back of a locked filing cabinet!
Why give back?
Let’s go back a step and explore seven benefits CSR can give your business:
- To give your business a moral framework in which to operate and communicate your core values to customers and suppliers.
- To build a reputation and corporate culture of “doing the right thing,” which makes it easier to recruit and retain employees and motivates your people to be more productive.
- To differentiate your brand… think of The Body Shop’s ground-breaking efforts in fair trade.
- To understand the wider impact of your business, which may lead to opportunities to develop new products and services.
- To appeal to increasingly savvy consumers, who consciously seek out businesses whose values match their own. The trends towards eco-friendly products and environmentally-sustainable ways of doing business are big examples.
- To generate positive media coverage… but, please, don’t negate the good you do by wasting your time bragging about it!
- Because you can. We live in an incredibly blessed country, where we take simple luxuries, such as soft beds, hot showers and delicious coffee, for granted. Giving back is a way of being thankful.
You’ll notice that most of these reasons are beneficial to your business. Let me be clear that you’re not selling out if your CSR strategy just happens to bring positive things your way — in fact, you’d be naïve to expect your activities to have no impact on your life. What is important, however, is the spirit in which you give — as long as your motivation is genuine and you’re giving not simply to get in return, I believe it’s okay to enjoy any rewards.
How to develop a CSR strategy
Most businesses make two big mistakes when developing their CSR strategy. The first one is not linking giving to core business. To avoid this trap:
- Choose CSR activities that match your top three business objectives — even better, make sure they contribute to the achievement of those objectives.
- Choose CSR activities that also match your core competencies; that is, what you do well.
Let me be so bold as to use myself and my company as an example. Admin Bandit is the developer of a self-named accounting software designed specifically for volunteer treasurers in community and non-profit groups. As such, our CSR activities focus on our target market — we have a partnership with the Canberra Preschool Society, I’m on the advisory board of the Multicultural Women’s Advocacy Employability Partnership Project and am a volunteer treasurer myself. Communication is one of our key strengths, so we also focus our voluntary efforts on tasks that involve public speaking, training and mentoring. I especially get a big kick out of sharing my experiences and the lessons I’ve learned either on the stage or by writing articles. As you develop your CSR strategy, think about your business and strengths in the following nine areas:
- Non-profit partnerships
- Human rights
- Philanthropy
- Environmental management
- Fair employee treatment
- Community investment
- Employee volunteering
- Product giveaways
- Sponsorships.
Walk the talk and measure milestones
Getting back to those two big mistakes many businesses make in their CSR strategy… the second one is two-sided: failure to motivate compliance and measure results. Motivating compliance is easy… keep CSR objectives fresh in the mind through signage and newsletters and make fulfilment a part of staff performance appraisals. As for measuring effectiveness, develop a set of key performance indicators, both internal and external, to assess your company’s reputation, brand perception, sales, customer and employee satisfaction and achievements in the community. Unsure how to get feedback? Try surveys (always offer an incentive, such as a discount or prize), testimonials or social media, such as Facebook.
