This is a thought leadership article by PrimeGlobal's strategic partner ACCA discussing the benefits of corporate social responsibility.
Corporate responsibility programmes add up to more than simply handing out cash, and deliver benefits for both donors and recipients. Just giving money is no longer good enough. In the world of corporate social responsibility (CSR), where companies want to be good corporate citizens, the focus is very much now on adding value, engaging with staff, customers and the recipients of corporate generosity, all the time with a firm eye on brand alignment and the overall impact on the business.
The ideal CSR programme will achieve a win/win result, where supported organisations benefit but also where there is a measurable benefit for the company. It could be through increased sales, improved staff morale, a higher profile or improved corporate reputation, but whichever way it is measured, companies have woken up to the fact that it can be good to give.
‘CSR is now a common part of business conduct for all progressive organisations,’ says Ailish Smith, account director at PSG Plus, the Dublin-based corporate reputation agency. ‘However, CSR enjoys such a wide definition that almost anything can be positioned as CSR and this can actually undermine its importance. For some organisations CSR means meeting legal or regulatory obligations. For others, it is an ethos that drives every business activity and for some companies CSR is based simply around charitable giving.’
According to Business in the Community (BITC) Ireland, 48 of the largest businesses in Ireland contributed more than €22m to community projects in 2014. This included €8.7m of in-kind donations, €10.5m in cash donations and €3.5m raised by employees. Volunteers gave more than 212,000 hours of their time to over 7,500 community projects. BITC Ireland sees a number of trends in CSR developing during 2016, including a focus on climate change, sustainable procurement, environmental matters, overwhelmed employees and gender diversity. These issues will emerge against the background of the European Union’s non-financial reporting directive (which must be adopted into Irish law to become effective from 2017) and the 17 United Nations sustainable business goals.
Core values and purpose
Which is why it is important that organisations know and understand their own CSR priorities – how and why they are involved in such activity and, most importantly, how it is measured. As Smith says: ‘Ultimately, CSR must support your business objectives, but CSR is not about how much money you make; it is more about how you make your money. A vital part of the process should be devising a CSR strategy that aligns your company’s core values and purpose with behaviours day to day.’
At KPMG, the firm endeavours to place CSR at the heart of its corporate strategy. ‘Our whole CSR strategy is embedded in all that we do day to day; we see it as being at the heart of all good organisations,’ explains Karina Howley, KPMG’s head of CSR in Ireland. ‘We are committed to making a difference in the communities within which we operate.’
Howley says that, through BITC, the firm measures all the community connections that the staff have during the course of a year, including all donations, whether through pro-bono work or in cash, the hours that are put in and how much employees fundraise. ‘This annual assessment allows us to measure the impact,’ Howley explains.
The firm splits its programme into different categories – community, charity, education, the environment, the developing world and workplace practices. ‘Education is one of the big areas for us – we hire well-educated people and we want to give back,’ she says. ‘Education is paramount in terms of developing our society for future success.’
KPMG programmes include reading activities in primary schools, mentoring schemes in secondary schools and encouraging university students to be active in their communities. The ‘Get Cents’ money management programme – arguably a great fit for accountancy firms – is proving particularly popular, as is the firm’s ‘Stories in Boxes’, which provide multi-sensory interactive storytelling experiences for children with learning disabilities.
KPMG is also among those that help other organisations measure the impact of their own programmes. The firm recently revealed that non-financial reporting among Ireland’s largest companies lacked consistency, making it almost impossible for stakeholders to compare one company’s performance easily and accurately with another’s. More than half (57%) of these companies do include corporate responsibility information in their annual report, usually in a specific section dedicated to the topic, though only a quarter (26%) had such information verified by a third party, some way off the global average of 42%.
Colm O’Se, a partner at KPMG, says that the findings showed a clear opportunity for companies to step up their commitment to providing good-quality information and reporting on non-financial matters. ‘Global reporting guidelines should help address the issue, but we all have a role to play,’ he says.
These issues go wider than just CSR, but they serve to demonstrate the need to measure and report on such non-financial activities, as it can help both internal measurement of CSR programmes and external recognition of the value such programmes create.
CMRF Crumlin, the Dublin-based children’s hospital, is one such organisation that recognises the value of CSR programmes, having benefited from corporate, as well as individual, generosity over the years. ‘Engagement with corporate donors is a two-way street,’ says Crumlin’s chief executive Joe Quinsey. ‘We never say it is all about us or all about the children; we want to work out what is important for the corporates and how we can engage with them.’
He adds that there can be a very eclectic mix of corporates wanting to give to the charity, so it is important to figure out the motivation of each. ‘We will then customise the engagement and the solution,’ he says, ‘learning from our bank of experience, as companies will ask us what we want or how can they help.’
While Crumlin has a ‘handful’ of partnerships that are in for the long run, most will develop a specific programme, with a specific target that can last between one and two years. Quinsey sees that a strong CSR programme can be very effective for staff engagement and will also demonstrate to the outside world the importance a company places on ‘doing good’. As he says: ‘CSR should be considered an important part of the corporate agenda. Taken seriously, the payback can be much bigger.’
So what makes a successful CSR programme? According to Aoife Davey, group marketing manager for gift card provider One4all, an effective campaign must be tied to business objectives. ‘It should align with your brand,’ she says, adding that good staff engagement will boost motivation. ‘And it must resonate with your customers.’
Indeed, One4All has teamed up with Crumlin for week-long shopping events, which see the company donating cash every time someone uses one of their gift cards. As well as raising €200,000, the event helps drive redemptions of gift cards – clearly a benefit to One4all and its retailing partners. Separately, One4all has raised €500,000 through its annual bike ride Cycle4Haiti, which also boosts its Bikes4work scheme.
Smith advises companies to actively report their CSR successes. As she says: ‘A serious and strategic approach to CSR communication fosters transparency and enables an organisation to gain credibility and trust among stakeholders.’
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