Being a socially responsible business can have many business benefits that you may be missing out on.
Being a socially responsible business can have many business benefits that you may be missing out on.
Xpand has been involved with community organisations since our conception, working closely with local organisations such as the Saltaire Festival, One in a Million and Bradford YMCA.
The growth of Corporate Social Responsibility over the last few years has been incredible. Worldwide Google Trends data shows an increase in searches for “CSR” around June 2012, although the UK searches for the same terms show interest to be a bit more volatile.
Worldwide
United Kingdom
A quick search for the same terms will find 197 million results in Google. With so many companies becoming socially responsible it’s becoming less of a differentiator between businesses, although no less important.
There are four types of CSR:
- Environmental and sustainable initiatives that limit a companies impact on the environment, such as limiting pollution or reducing greenhouse gas.
- Philanthropic giving such as donating time, money or resources to non-profit organisations.
- Ethical business practices, such as equal pay, paying the living wage or using fair trade products.
- Economic responsibility, balancing commercial decisions on their impact on society.
So what exactly are the business benefits?
Building Customer Trust & Improving Your Public Image
The main one is that it improves perceptions of your business. If you’re seen to be socially responsible, your business will receive a much more positive reaction than one that is not. Think oil companies not investing in clean energy. Shell Global is doubling its investment in clean energies research in 2019 to £3.2bn as they see that to be the future of their business.
It also builds customer trust. A 2015 Nielsen study in the US showed that 66% of consumers are willing to spend more on a product if it comes from a sustainable brand. This figure jumps to 73% for Millennials. Simply put this demographic expect their favourite brands to operate sustainably and ethically.
Differentiation From The Competition
As in the examples above, practising social responsibility is how a company can differentiate itself from the competition. The growth in CSR initiatives is making it harder to stand out, but it is still possible.
Morrison’s is working to remove the amount of plastic packaging being used in response to customer feedback. A trial was recently launched in eight of its stores to test customer attitudes to plastic-free grocery bags at the checkout.
This follows on from the decision to remove single-use plastic bags for loose fruit and vegetables in 2018.
In 2018, Iceland became the first major retailer to pledge to remove plastic packaging from its own-brand products by 2023.
This kind of responsibility is as a result of growing consumer demand. A survey in 2018 found that 80% would endorse a supermarket’s decision to go plastic free and 91% would be more likely to recommend friends and family as a result of such a decision. A separate survey found that 36% of shoppers had begun boycotting brands over sustainable packaging.
PR Opportunities
Of course, such initiatives from big brands will garner press attention. Even on a smaller local scale, any plans to support or work with a local organisation will provide press opportunities.
A quick search of the local newspaper will show two CSR initiatives on the home page.
A deeper site search will show results in the tens of thousands for keywords associated with CSR such as campaign, charity or donation.
SEO Benefits
With PR opportunities come potential SEO benefits by way of links. Links are still one of the major ranking factors and coverage in publications can result in backlinks to your website. To take advantage of this, when launching a CSR initiative make sure there is news of it on your website, maybe with additional details that weren’t reported. Give the publications a reason to link.
Improving the number of links to your website from trusted, high authority sources can lead to improved rankings. This could be from local, national or trade websites.
Reaching Your Desired Audience
CSR offers an opportunity to reach your desired audience. Creating partnerships with organisations that your target audience also supports is a way of being present your business in front of them. Take the example of Morrison’s plastic ban based on customer feedback. They are dealing with an issue that their current customers care about and potentially reaching new customers that are looking for a supermarket that cares about eradication plastic waste.
Sponsorship is a great way of forming a partnership with an organisation, as they need finance or access to services in order to run programmes. Sponsorship provides the funding or services that allow them to work with communities that need them.
Sponsorship can be for anything really, but common examples are:
- A local sports team or group
- An organisations website
- A particular function of an organisation
- An event, such as an awards dinner.
Cost Savings
Businesses involved in environmental CSR initiatives often focus on reducing an element of their business in order to ‘go green.’ These schemes often have commercial benefits by way of cost-savings. In 2016, Fortune 500 companies in the US saved a collective $3.7bn.
Energy efficiency measure implemented by Proctor & Gamble saved the company $500m alone, with the potential for even more savings. Google, Apple, Coca Cola, Pfizer and Sony have all signed up to ‘going green.
Examples could be:
- Go paperless
- Switch to a green energy supplier
- Buy as a good as new furniture
- Cut down on emissions
- Recycle equipment and waste
- Help a green cause, such as organisations committed to planting trees.
Thinking about the long-term sustainability of your business will help to ensure that your business has a future.
Access To Business Networks
Helping a local organisation can provide you with access to a network of other supporters that could enhance your business, or who could be prospective customers or clients. An example would be One in a Million, a children’s charity in Bradford, that runs a Corporate Partners Programme. In exchange for a regular subscription fee that is used to fund its various programmes, they provide quarterly networking opportunities for business that sign up. This model benefits the charity that requires funding order to reach those who use its services, and the businesses who gain access to other like-minded businesses.
Employee Benefits
Being a socially responsible business has benefits for your employees. People like working for a business that is passionate about helping its local community and are more inclined to be loyal meaning engaged, productive employees and reduced recruitment costs.
A well thought out CSR programme can also be more attractive to potential employees.
Final Thought
As well as the above business benefits, a good CSR programme can positively impact many people, whether employees or a local community. One important point to note is that any partnership should benefit the community. People will see through thinly-veiled partnerships, for example sponsoring a community organisation with the only intention of earning links. Long-lasting partnerships are paramount and will offer win-win situations for the beneficiaries of your CSR programme and your business.
