Three Reasons Why Genuine Social Change Is Better than CSR
I’ve spent the last eleven years helping large corporations understand and improve the business value of social change. During that time, the most important thing I’ve learned is that only corporations with a genuine and long-term commitment to social change will realize a material benefit to their businesses. Here’s why, along with three examples of remarkable corporate social purpose programs:
CSR programs that are based on the “DNA” of a corporation don’t work. Unfortunately, most consumers expect large corporations always to be selling, to increase prices regularly and to be loyal only to themselves. Most corporations live up to these expectations and have aligned their corporate social responsibility initiatives accordingly.
Sustainability at Wal-Mart is a good example. The company has a “shared value” approach to reducing both the environmental impact and the cost of waste by working with (i.e. mandating) its vendors to reduce packaging. Sustainability at Wal-Mart is consistent with who they are as a business and consistent with our expectations of how they would operate. However, especially at a time when the company’s corporate reputation is under attack as a result of what is being referred to as a “campaign of corruption” in Mexico, a new approach that separates genuine environmental change from business value would be much more effective.
McDonald’s and their support of Ronald McDonald House Charities is a perfect example of a company that has developed a highly effective approach to helping the families of very sick children in a way that is very distinct from its business.
Employees aren’t actually engaged. One of the first documented business benefits of CSR was employee recruitment and retention. That was more than ten years ago. Since then, two important and mutually exclusive things have taken place: a whole CSR industry has developed around employee engagement. But at most large corporations, employees are really only accountable for business results.
Senior managers at large corporations always ask me why so few employees know about the companies’ social programs and even fewer participate, even though internal communications are brimming with CSR information. Unfortunately, the answer isn’t very complicated. Employees are so nervous about meeting their performance objectives that they delete every CSR-related email and tune out all the posters in their lunchrooms and elevators. In this context, it’s unrealistic to expect that more employees will be engaged in social purpose programs. However, those employees who are genuinely interested and who have the time and ability to get involved deserve the opportunity to participate in social program that are extraordinary. In return, they will be more loyal and there will be a business case.
3M‘s Healthy Communities program created opportunities for employees to participate in hands-on school programs and community events that were organized by some of Canada’s most effective charitable organizations. In return, employees were genuinely engaged and the program was a recipient of the company’s Global Award for Marketing Excellence in 2011.
Cause marketing has become ubiquitous and high risk. It’s hard to think of a brand that isn’t associated with a cause or non-profit organization. On the one hand, that’s a good thing. On the other hand, it feels like cause marketing has become a ubiquitous “last ditch” tool to capture market share and drive sales when all else has failed. Further, brands that deploy cause marketing promotions such as Pink Ribbon Campaigns now run the risk of being targeted as opportunistic by socially-conscientious consumers. Especially the 78% of Millennials who feel personally responsible for making a difference in the world and believe that companies have a responsibility to join them in this effort. (Source: Cone Millennial Cause Study).
In Canada, Starbucks’ new Thriving Neighbourhoods program is a great example of a long term social change program that will help Millennials (and others) make a difference in the world. Thriving Neighbourhoods is likely to translate into more and more loyal customers.
Why are we awash in CSR blogs, conferences, program, consultants, and academic theory but seem to be losing ground? Perhaps it’s because we’re trying too hard to systematize and merchandize CSR. It’s finally become clear to me that the only sustainable way for corporations to derive real business benefit from CSR is through meaningful and measurable social change. As always, I welcome your point of view.
Follow me on Twitter at paulatimpakt