By James Wright
As the economy continues to slow following the credit crunch and businesses tighten their belts, the world of corporate social responsibility (CSR) faces its toughest challenge
to date. CSR has never had such a high profile as it does today, and never has it had to deal with recession.
Climate change, corporate scandals and the Internet have each played a significant role in making CSR one of the most talked about business subjects of recent years. There has
been an explosion in environmental and social strategies implemented by businesses, the amount of green legislation is swelling and the number of global reporting procedures for
measuring business impact is beginning to change the way many do business. From a communications perspective, CSR strategies are becoming as much about protection as enhancement;
failing to address CSR issues is no longer a behind-the-scenes faux pas; now it's a mistake that could destroy your organization's reputation.
As the markets deal with the U.S. subprime fallout, the effect is reverberating across business budgets around the world. Every part of how business is done is under the
spotlight and, in particular, CSR activities are being questioned. Boardrooms want to know how it is tangibly benefiting the business.
For the CSR industry, an economic slowdown may turn out to be a good thing. Firstly, it will expose those companies whose approach to CSR is "tokenistic"--those that talk a
good game but don't actually do that much, also known as "greenwashers."
Secondly, as companies look at what they do in this area, it will encourage them to become more strategic, looking much more closely at the business benefits rather than at a
number of tactical activities that have limited benefit.
Finally, the fact is that most CSR activities are good for business, in terms of: HR, attracting the best talent and improving retention; risk management, in terms of physical,
legal/regulatory and reputational; selling products and services as a point of differentiation; and, ultimately, ensuring a sustainable future for the business.
So, what should you do to ensure your CSR and associated PR budget is not significantly affected?
1. Audit your activities. Look at every CSR activity or initiative you undertake and attach them to the following pillars: marketplace, the workplace, the environment and the
community. Each of these pillars will then present the suite of CSR activities you undertake. Some companies use different pillars depending on the activities undertaken, but
these are a good guide.
2. Business benefits. Look at how each of the activities within these pillars helps you achieve your business objectives. If one of your objectives is to attract and retain the
best talent, look at how your policies and activities support this, ensuring you provide statistics prove your point. Boards will look particularly favorably at areas that save
your business money, such as energy efficiencies, so make these savings clear. Highlight the areas that are improving your reputation or setting you apart in your industry.
Those companies that have gained competitive edges due to sustainability or CSR commitments are unlikely to want to give that up. During an economic slowdown, we may also see
consumers actually accelerate some market segments, such as an increase in the purchasing of energy-saving products to save money.
3. The future. You need to talk about the medium- and longer-term picture. Ask what the long-term impact will be with stakeholders of walking away from some CSR activities.
Media and non-government organizations have long memories. You need to ask what future government policies will look like. In the U.S., there is likely to be an acceleration
toward a low-carbon economy following the November presidential elections.
If you have been working on carbon reduction strategies, then this will need to continue so that major changes are not required at higher costs due to future legislative
enforcement.
For those that don't have carbon reduction strategies, they will need to think about investing in them, even in difficult economic times, so that they begin the task of meeting
any new regulations. Spending a comparatively small amount now may provide a larger saving in the future.
4. Be proactive. Produce a strategic review paper that covers your whole CSR program, if you don't already have one. If you have been operating a strategic CSR program, this
paper should provide all the proof decision-makers will need that this work is intrinsically important to your operations and business success. It can not be pushed aside. It will
also enable you to work on those areas that require more proof of their value and, if required, will identify where amendments and improvements need to be made to strategies,
tactics and measurements.
All in all, what we are likely to see over the next 12 months in the corporate world is a split into two camps of the CSR believers and the CSR nonbelievers. It is time for
companies to show their true corporate philosophy and responsibility values. For CSR, this really is crunch time. PRN
CONTACT:
James Wright is director of corporate social responsibility at PR consultancy Trimedia International and is based in its London headquarters. He can be reached at [email protected].