I dashed this piece off last year on our main website, and it’s still quite popular, so I thought I’d put it up here too. Interested in reader comments.
It’s designed with a sceptical audience for CSR in mind…
While many corporate executives are worried, rightly, about their budgets for next year, there are many good reasons for continuing efficient responsible business initiatives in 2009. Here’s a few of them.
While I wouldn’t claim to be an expert on pretty much anything. I have been out and about talking to some big companies about what may be going on next year in the world of responsible business.
Clearly, all in the world of business ethics are concerned about what they will be allowed to spend in the next year or so.
But smart companies will know that well-thought-out programmes can be worth the investment, given that, lets be honest, CSR is cheap compared to advertising spend, or paying staff more money.
While Matthew Bishop at the Economist calls CSR often “a cynical exercise in public relations”, companies do it because it can deliver, despite the challenges in measuring impacts or progress.
Here’s some reasons I have gleaned from talking to companies in the last month as to why the right CSR spend is still worthwhile:
1) It can be cheap. CSR that does not radically alter business models does not cost that much. And, as we all know, can save money. As anyone from Boots to Wal-Mart will tell you, going greener often saves money. CFOs will like that. Make the case to them, convince them that what you are proposing helps the bottom line. They may have forgotten and started thinking its all socialist plot again. Some stats on their desk might help.
2) Reputation and transparency are still key. In fact, they are now even more important. If you let people go, you need those you keep to understand why you did it. And how you did it in the best way possible. You still need talent, and talented people want to know you are well regarded.
3) Communities are feeling vulnerable. They are looking for local leadership on important issues. Your company may be able to help. Think about what you can do that’s different, and that caters to their current concerns, not to your volunteering plan from last year.
4) Customers are worried. They are wondering who they can trust. Some readers may have seen the new Lloyd’s TSB ads, which talk about how they are seen as solid (implying others are not). Help reassure customers with communications about anything from product safety to reliability and good service awards. These things matter. And yes, this is part of CSR.
5) Regulators are up in arms. Many are happy to use the business world as a scapegoat for their own poor regulatory incentives. Showing you are still focusing on a bit more than just sales and cost-cutting can help you reassure them that you care, and may help them stop over-reacting.
6) Green advertising has gone mainstream. People care about green if it delivers efficiency, particularly for them. So communicating well is still key, and a green/efficient message may still resonate well.
7) Newspapers are even hungrier for copy that sells. And companies provide excellent cannon fodder for editors. Ethics related cutbacks, poor customer service and extended payment terms will all start making the news. Keeping an eye on over-eager internal plans and how they might go against your values statements can help keep things consistent. No board wants to see panic, so re-iterating values in tough times may help keep things in check.
8) There is opportunity to gain trust. This is particularly true if others are cutting back. Showing you can treat your customers, suppliers and business partners fairly, even when times are right, may help you build that bank account of goodwill, useful when you really need it.
9) Think about the short term future. Recessions don’t last long, usually. Imagine the benefits of NOT cutting back once all this is over. You’ll be able to crow in your CSR report, that unlike others, you kept X and Y initiative going when times were tough
10) Trim the fat. Become more evidence-based in your approach without upsetting partners who may go to the media in better times. This time they may be more understanding. Being more rigourous will only help when things pick up again.