I'm an advocate of business social responsibility. I believe it is imperative, especially in our current age of weakening social institutions. I also believe it is a powerful marketing strategy that, when employed strategically, makes makes good business sense.
Corporate social responsibility rests on this premise: other things being equal, many consumers would rather do business with a company that stands for something beyond profits.
Recent studies have documented that many consumers carefully consider a company's reputation, business practices and social committment when making purchasing decisions. A recent Cone/Roper Corporate Citizenship Study showed Americans’ attitudes towards the role companies should play in society. Almost eight in ten Americans (79%) believe that companies have a responsibility to support causes. Almost nine in ten Americans (88%) say that during an economic downturn and period of tighter consumer spending, it is important for companies to continue supporting causes.
Some in the business world differ, believing that a business' only responsibility is to it's shareholders and bottom line profits. A recent newsletter by marketing guru Dan Kennedy, although not onstendibly about business social responsibility, noted:
"There can be no mistake: I believe zealously in capitalism, the profit motive, and as pragmatism, that if you are running a business your responsibility is business, not dogooderism of any kind."
A couple of years ago, The Economist published an article noting that corporate social responsibility may have become an "industry" that is based on unquestioning, herd mentality with little or no benefit for companies who partake:
"...it is philanthropy at other people's expense. As a rule, so far as public companies are concerned, managers do not own the firms they work for. They are entrusted with the care of assets belonging to others, the firm's shareholders.
Supporting good causes out of their own generous salaries, bonuses, deferred compensation, options packages and incentive schemes would be admirable; doing it out of income that would otherwise be paid to shareholders is a more dubious proposition. Anyway, is it really for managers and NGOs to decide social-policy priorities among themselves? In a democracy, that is a job for voters and elected politicians."
I agree that putting social agendas and lofty causes before business principles and profits is misguided. A business that does not produce sufficient revenues will not be in business for long, no matter how noble it's principles. However, a business case can be made for business social responsibility. You can make money while making a difference.
The Strategic Approach to Business Social Responsibility
I am currently at work on a new book that includes business social responsibility. In my research and interviews, I am finding many, many examples of companies, large and small--from 1 person firms to multi-million dollar companies--embracing business social responsibility in many forms and enjoying real, bottom line benefits:
Volunteerism. A company can build community involvement into it's roster of initiatives. It can encourag employees to get involved in community activities on the company clock. This strategy, when employed strategically, can bring about good PR, ties to other businesses and leaders in the community, as well as boosting employee morale and loyalty.
My client Jim Jenkins of Creative Visions Consulting recently developed a booklet called A Manager's Guide To Building High Performing Teams. One strategy involves taking employees out for a day to support a local group. This builds collaboration and a sense of respect and accomplishment.
Taking your team out to volunteer has a direct impact on retention and morale. According to Council on Foundations, employees who participate in community-based efforts through work are more likely to:
• Stay with a company for at least two more years
• Recommend their organization as a good place to work
• Deliver better deliver better customer service
Volunteering as a team also solidifies your reputation as an employer of choice and positions you as a strategic business partner with a sense of good will within your community. This equates to increased profits as many of today's customers prefer to do businesses who give back to their communities.
For example, Booz Allen Hamilton’s San Antonio office developed much goodwill for their firm when they supported the local Red Cross by providing the equipment and staff for a local call center to help displaced people leave messages for their loved ones after Hurricane Katrina.
Consider spending a day at a local school where the classrooms need painting, delivering meals to terminally ill people, reading to children who have no parents, or cleaning a park that lacks funding for proper maintenance.
You'll find that in this process that not only will you have a higher performing team, but also a newfound respect for generating profits with principles!
Probono Work. Volunteering your time and expertise with a nonprofit foundation or doing pro-bono projects, alone or as part of a group, is an easy way to embrace social responsibility. Volunteer work also provides some of the best networking opportunities to meet others in your field or to develop relationships with key decision makers.
When Eunice Azzani, an executive recruiter, volunteered to serve on the board of the San Francisco AIDS Foundation, she didn't anticipate that it would connect her with executives from Mervyn's, Bank of America, and Wells Fargo Bank, all of who eventually hired her to work for them.
"People don't hire a piece of paper or a process. They hire people they trust," Azzani says. "Volunteering for a position at a local organization makes you very trustworthy." She advises business owners to target causes they believe in. "If you're helping with a cause you believe in, people will see that you care. And they'll realize you will probably care as much about your work."
Because her of her overall generosity and committment to principles that transcend profit, Azzain is well known and respected in her field, and business world exposure and recognition come with ease. According to an article in the San Francisco Business Times:
Eunice is ever generous about giving away her services, time and wise counsel. She does five pro bono searches a year (which ends up being six or seven). She has held leadership positions on dozens of boards and is a passionate advocate for any organization she serves. She has mentored countless women (and men) in this community, and has helped seed many in the field of executive search.
Among my associates, if someone has a career challenge, change or crisis, the first word of advice is: "Call Eunice." Rarely do I sit on a board or committee where her name does not come up -- either as a potential honoree, speaker, board candidate, chair, adviser or source of information. If a need arises, "Ask Eunice." For a woman who has given so much to so many, Eunice is not about taking credit. She prefers to defer the limelight to others. But to those who give comes abundance -- and people simply want to honor her.
Community Sponsorship. In a recent interview with Richard Steckel, author of Making Money While Making A Difference, I learned about Big Bill’s New York Pizza in Centennial, Colorado. Bill is a local icon first and formost for his excellent, New York style pizza. But he’s now a homegrown hero through his commitment to the local community, including sponsoring a local baseball team.
“When you go to Big Bill’s anytime during the year, there’s a group of kids having a celebration,” says Steckel. “And they are connected to Big Bill through his being involved to their team. Their parents are loyal to Big Bill’s because they know that he genuinely cares about kids, sports and the values that sports teaches young people.
I agree with Kennedy that "there are lots and lots of ways that you can create success in business and, as by-product, have considerable positive influence. We probably think of 'service' in too narrow of terms."
Start by seeing your business in a broader way, considering not just paying customers but the community at large. Consider your own values, and those of your marketplace. Look for natural win/win tie ins to community causes that you genuinely care about, and that resonate with your target market.
Of course, like any other business activity, business social responsibility should never be done in a vaccuum with no consideration for the practical, bottom line reasons you are in business. But it should come from the heart to have true potential for creating an emotional bond with your clients and customers that will last a business lifetime.
Though it’s Bill's excellent pizza that gets them in the door, his community involvement keeps them coming back as lifelong customer evangelists. Little kids look up to Bill. Parents look up to him and think, ‘hey, you’re somebody I want my child to be like…you’re a local hero,’ who in business doesn’t wanna be that??”
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