Gone are the days where companies acted solely for its own benefit. Instead, companies are increasingly called upon to play their role as a responsible corporate citizen, one that plays their part for the community and environment. When CSR is done right, companies are rewarded and when it’s done wrong, companies find themselves with bad reputation and possibly even bad business. It is therefore important for companies either big or small to carry out their responsibilities as a corporate citizen, but the question is how should companies go about implementing, enhancing, or re-inventing their CSR strategy?
One, building your CSR strategies around the company’s core competencies. If a company has strengths, research or knowledge in a specific area then supporting a cause that aligns with that will be a win-win for both the company and community. For example, a legal firm may partner charities to provide pro bono legal advice and representation to local communities or individuals giving those in need access to justice. Restaurants and cafes may consider donating perishable food to elderly homes instead of throwing them out. Restaurants may benefit by enhancing its reputation and reducing food waste while the beneficiary benefits from having more food on the table at mealtimes.
Two, adopting causes that matter to the company’s one or more consumers group. Studies have proven that customers are loyal to companies who support social or environmental causes that they care about and reward them through purchases. International skincare and cosmetic brand Estée Lauder Cos. whose main customers are women have lent their support for breast cancer awareness since breast cancer is a common disease amongst women. It is easier for their main customer to empathise with the cause as it is an issue that is significant to them.
Three, embracing innovative CSR tactics that makes sense economically. Traditional CSR was defined as annual giving programs, cause marketing campaigns and efforts were directed at reducing environmental resources. When the economy takes a turn for the worse, management may cut back on CSR programs because it is a cost item on the balance sheet. However, CSR can add to a company’s bottom line when it is skilfully woven into a company’s business fabric. This include taking the right business actions such as creating products or services that protects and benefits the environment or society and ensuring individual well-being. A good case study is Nike new shoe line, Move To Zero Shoes.
Four, consistently carrying out CSR programs over the long term. A company that consistently helps its communities shows that they genuinely care. One example is Singapore-based international accounting firm, Nexia TS which continued to give back to the Boys-Brigade Share-A-Gift Project. Henry Tan, Group CEO & Chief Innovation Officer, Nexia TS who is concurrently the Chairman of Boys’ Brigade, said, “For CSR to be successful, consistency is key! This means that we must be committed to the causes that we believe in even during difficult times.” The company has been giving back to the local charity for the last 13 years. In general, the media and public tend to look more favourably on companies who sincerely carry out their CSR commitments and reward them accordingly.
Finally, being flexible with resources and social movements. Good CSR plans need to be flexible! For companies with limited budgets, this could mean revising budgets allocated to CSR programs, identifying non-profit partners to collaborate on a new program or enhance an existing programme. It is also important to pay attention to key social movements because what may not be important previously may start to become important and failing to notice such trends may cause the company to fall behind its competitors or even worse, find their business plateau. Fossil fuel companies are in a bind because consumers and governments are moving away from fossil fuels due to environmental concerns.
As companies carry out CSR program and accumulating social capital at the firm level, industry and societal level over the long-term, it benefits from a better brand recognition, positive business reputation and operational cost savings. Employees are more satisfied and there is greater level of trust amongst stakeholders of the firm. Essentially, when CSR strategies are put together effectively, it can become a key component of a companies’ competitiveness.
About CLA Global TS (formerly Nexia TS)
Founded in 1993, CLA Global TS (formerly known as Nexia T.S.), is an award-winning Asia-Centred Business Advisor. An independent member firm of CLA Global Network, CLA Global TS provides a full spectrum of professional services including, but not limited to Assurance & IPO Reporting, Tax, Risk Advisory, Valuation, Insolvency & Restructuring, Sustainability & Climate Change Advisory and more.
For more information, visit CLA-TS.com.