The Importance of Corporate Social Responsibility (CSR)
“Heavy is the head that wears the crown.” Everyone’s first taste of responsibility can be scary, mostly because they don’t know what to do with it. For some, maybe it is the first drive after a nerve-racking session at the DMV. For others, it could be signing your first lease. Any good executive should strive to use their first taste of responsibility to better the environment around them. The common saying, “With great power comes great responsibility” rings true today more than ever. Corporate social responsibility can be defined as a dedication to to benefit society in your actions as a company. However, on top of benefitting society in general, there are actually many ways your company can benefit from enacting a strong CSR.
- Employee Engagement: Employee engagement has been a hot topic within business for a while, and it’s no head scratcher why. Employee engagement has been proven to raise motivation, loyalty, as well as innovation. One of the ways to increase employee engagement is having a strong sense of CSR. When employees feel that their work has a purpose, or that their company is dedicated to the greater good, a strong sense of pride is developed, and therefore, engages employees, and improves retention.
- Customer Retention: Similar to employee engagement, customers like to feel as though their investment in a product or a company goes to a cause that benefits the greater good. That is why companies with a strong sense of CSR tend to yield higher customer loyalty and retention rates. Research shows that 87% of Americans are more likely to buy a product from a company that they can align their values with, and over half of all consumers are willing to pay extra for a product if they’re buying from a company with a sturdy CSR strategy.
- Increase in Revenue: While it may seem unlikely that giving money towards a cause can increase revenue, it is possible! Company image and culture both rise as a result of a strong CSR, and therefore, motivate customers to want to invest in them. That is why companies investing in social purposes have a 6% higher market value and generate 20% more revenue than companies that don’t have a strong CSR.
Whether it’s running a company or ruling a kingdom, responsibility is something to be handled with tremendous care. Today, it could be pitching to shareholders or sharpening your company’s image. Tomorrow, it could be defining your company’s impact on the world around you. CSR is mutually beneficial, and more importantly, is a great way to leave a lasting, positive impact. Heavy is the head that wears the crown…but prosperous is the kingdom with a philanthropic ruler!