Companies are boosting their focus on CSR or Corporate Social Responsibility, in current times. For this, they might be championing the rights of women, taking measures to protect the environment or trying to erase poverty at the global, national or local levels.
By considering an objective perspective, companies pursuing CSR impel highly appealing images to both shareholders and customers at the same level. This has an encouraging impact on their bottom line.
Companies can exhibit their CSR activities in several ways, like ethical labour practices, environment-friendly processes of production, a donation to charitable organisations and arranging volunteering by employees. Through the process of doing good work, companies not just aid their community but also reap some benefits.
Key Points
- CSR policy empowers employees to exploit the corporate resources available to them for social good.
- Being a socially responsible company can help boost the image of the company as well as its brand.
- CSR programs help to bolster employee morale in the workplace and result in greater productivity, which has a great impact on the profitability of the company.
- Businesses which implement CSR initiatives can improve the retention and loyalty of customers.
- Companies practising CSR have the chance to stand out from the competition since they cultivate positive and superior recognition of the brand.
Three Benefits of CSR
- Appeal to customers
When a company embraces CSR policies, it goes a long way in attraction and retention of customers; this is vital for the long-term success of a company. Additionally, when many people realise that part of the profits of a company will be channelized towards social causes close to their heart, they will be willing to pay a premium for products of that company.
Companies adopting CSR activities to uplift the local community will also witness an increase in foot traffic. For instance, those banks which dispense loans to low-income households are likely to witness an uptick in their business directly because of such initiatives.
- Boosts motivation of employees
A critical tool to enhance employee engagement is CSR. Companies pursuing CSR tend to attract employees with an eagerness to improve the world, apart from collecting a paycheck every month. In big companies, these manifest as a strength in good numbers, and collective efforts by companies can accomplish substantial results; this enhances the morale of the workforce and improves productivity.
As per Harvard Business School, nearly 70% of employees will not work for a company without a strong goal or objective. 90% of employees of companies with strong purpose express the view that they are more loyal, motivated and inspired.
Research also suggests that the engagement of employees translates directly to the bottom line and overall performance of a company. Engaged employees show a 17% rise in productivity, are more profitable by 21% and account for 41% reduction in absenteeism.
- Customer loyalty with community support
CSR serves as a platform for both consumers and companies to contribute a positive impact on global and local communities. Companies with CSR initiatives as part of their values have the chance to raise customer loyalty and retention.
Community-oriented companies often wreck their competition thanks to superior imaging of their brand. For instance, Elon Musk and his company, TESLA, have attracted environment-minded consumers with their array of green automotive products as well as electric cars.
In sum, CSR is much more than paying lip service to new global trends; it is about sustained and systemic change which has a positive impact on the community. Considering the profound social differences and big business benefits that can be earned by CSR, it is a win-win for everyone.
