Companies of all sizes, from the local restaurant to the regional law firm to the national or international corporation, are recognizing that an active corporate social-responsibility program plays an essential role in ultimate business success. No matter the size of the company, the community or the contribution, these entities realize that having a reputation as a good corporate citizen helps any business recruit and retain employees, create better relationships with vendors and regulators, satisfy investors and deepen ties with customers.
Americans’ appetite for corporate involvement in social and environmental issues is voracious,” states the 2013 Cone Communications Social Impact Study. “Just 7 percent of the U.S. population believes corporations only need be concerned with their bottom-line. More than 90 percent look to companies to support social or environmental causes in some capacity, and 88 percent are eager to hear from those companies about those efforts.”
A report to be published this week by the Boston College Center for Corporate Citizenship confirms that successful companies are incorporating environmental, community and governance strategies as key elements of their business plans. “Advancing the Core” summarizes the corporate-citizenship efforts of 231 public and private companies that span sizes and industries and comprise business-to-consumer and business-to-business entities.
Among the study’s findings:
- Reputation enhancement a primary business goal. More than 70 percent of the companies surveyed cited reputation enhancement as a top business goal of corporate-citizenship efforts. Other goals were improving employee retention (45 percent), enhancing employee recruitment (41 percent) and attracting new customers (33 percent).
- STEM education a primary social goal. Almost half of the surveyed companies highlighted the improvement of science, technology, engineering and mathematics education opportunities as a primary social goal. Other goals were environmental sustainability (41 percent), improved education (34 percent), eradication of extreme poverty or hunger (23 percent) and relief in the wake of natural disasters (20 percent).
- Increased responsibility at the top. Almost 60 percent of corporate-citizenship efforts are spearheaded by an executive. This is a 74 percent increase over a similar 2010 study.
- Leaders more engaged. More than 60 percent of chief executives are “highly engaged” in corporate-citizenship events and initiatives. More than ever, these CEOs are involved in developing strategy, setting goals and communicating citizenship efforts internally and externally.
- More money for citizenship initiatives. Almost all of the surveyed companies have a corporate-citizenship budget, compared with 81 percent in 2010. Almost one-third of these companies have a budget (above and beyond charitable donations) of at least $1 million.
- More money for charitable giving. Of the companies surveyed, 98 percent have a corporate-philanthropic-giving budget. More than 25 percent of these companies budget $5 million or more for philanthropy.
- Strategies in place. Almost two-thirds of surveyed companies had established a formal corporate-citizenship strategy. Eighty-six percent include corporate-citizenship language in their corporate value statements.
- Success linked to corporate citizenship. Compared with average- or below-average-performing companies in an industry, high performers are more likely to have a formal corporate-citizenship department, a program led by an executive, and higher citizenship- and charitable-giving budgets.
Companies must choose between being mere residents of the communities in which they operate and becoming involved citizens. “It is not reasonable to expect communities to be business-friendly,” said Kent Thiry, chief executive of Denver-based DaVita, “if businesses are not community-friendly.”
For companies and communities, corporate citizenship is a win-win proposition. When corporate citizenship is conducted thoughtfully, strategically and transparently, businesses can achieve the “Holy Grail” of the triple bottom line – results that benefit people, enhance profit and improve the planet.
This article originally appeared in the Denver Post, 1/12/14. It is reposted here with permission by the author.