Brand CSR: The Business Case for Successful Branding and Social Good

According to a Nielsen poll of consumers in 60 countries, 55 percent of purchasers are willing to pay more for products and services from companies that do their part to encourage positive social and environmental impacts.[1]

Clearly, corporate social responsibility influences buying preferences, but how else is it important? We’ll examine the answer to that question below.

Image via www.huffpost.com

What is Corporate Social Responsibility?

Corporate Social Responsibility, or CSR, occurs when companies take into account the sociological, financial and environmental impacts its actions have in the world and decides to ensure its actions make a positive impact. [2].

Some business experts have simplified the definition of CSR even further to suggest it encompasses everything a company actively does to have a positive impact on society.

There are numerous types of CSR, such as:

• Philanthropy
• Production Improvements
• Better Conditions for Workers
• Sustainability
• Community Enrichment
• Diversity in Hiring Practices
• Supporting Companies with Similar Values

Typically, the manner in which a company engages in CSR is closely aligned with its brand strategy, brand values, positioning, primary audience and industry sector. For example, a clothing manufacturer might iron out a CSR plan that improves working conditions in factories located in developing countries, while an establishment that makes paper products might commit to CSR that ensures the world’s most at-risk forests are protected and regenerated.

Why is CSR Good for Business?

Although many corporate leaders are encouraged by the aforementioned statistic that shows a company’s involvement in CSR may mean a customer is willing to pay more for its services, they usually require stronger beneficial commercial evidence before taking further action.

However, they don’t need to look very far before uncovering some of the numerous other benefits linked to CSR, including: [3]

• Happier Staff: Employees take pride in working for a company that supports the greater good through worthy actions and happier staff are more productive and better brand ambassadors

• More Informed Customers: If your company announces a CSR strategy, the associated plans could potentially result in a more transparent organization which in turn typically results in more loyal customers.

Research shows customers want to know more about the things they buy, product or service, than ever before. For example, a study published by IBM noted 59 percent of American consumers and 57 percent of consumers from the United Kingdom have become more informed about the foods they buy and eat over the two years prior to the study’s publication.[4]

In other words, customers’ predisposition to buy, product or service, is becoming increasingly influenced by an organization’s authenticity, openness and commitment to the greater good.

• Reduced Costs: CSR can cut costs by helping companies become aware of and minimize risks, plus improve the efficiency of their supply chains.

• Improved Competitiveness: In a challenging marketplace, a worthwhile CSR plan could carve out a more solid place with a unique positioning for a company to thrive.

• Better Public Relations and Reputation Management: A CSR plan gives a company a platform through which to promote good things like community involvement, donations to charities and other big-hearted gestures.

Developing an Effective Corporate Responsibility Plan for Your Brand

In order to launch a CSR plan that’s good for business and engages genuinely with your stakeholders, it must be carefully crafted. The key is to strike a balance between benefiting society at large, and benefitting the business. [5] Doing that means:

• Evaluating how and where the business can have the greatest societal impact without taxing the company’s leadership and resources. This frequently involves scrutinizing the company’s existing competencies. Those strengths can provide clues to possible CSR strategies that are revealed after tapping into existing skillsets.

• Cultivating a deep understanding of how certain actions could help the business while simultaneously supporting the chosen causes. This often also necessitates having an open heart and mind while listening to feedback from stakeholders.

• Aligning with partners can propel your desired efforts and help bring goals to fruition. Ideally, adopting a long-term mindset when forming collaborative CSR relationships is best for all concerned.

• Ensure business objectives and CSR goals match up. If there is a disconnect between these two components, your CSR activities risk being time-consuming and lacking the power needed to make lasting changes.

Examples of Brand CSR Strategies That Have Worked Well, and Why

Now you have a deeper understanding of what corporate social responsibility is and how to start formulating your own plan, let’s look at the characteristics of some successful CSR programs with companies that are excelling in their CSR endeavors [6]. You can then use these actionable tips to drive your own brand CSR inspiration.

CSR experts agree all successful CSR programmes typically have:

• clear objectives
• measurable outcomes
• well-developed theories for how to achieve the desired goals
• sufficient information for stakeholders about why causes are worth pursuing
• dedicated and highly focused efforts from the entire company
• a willingness to partner with credible experts.

Let’s look at a few case studies that detail some stellar CSR successes.

APS Group

This UK-based SME spent years ironing out its CSR strategy. Lacking the resources to hire a dedicated CSR team, the company found employees who were willing to champion the company’s CSR causes, which include education and supplier sustainability.

Media clips from the company place a strong emphasis on making things possible for clients that they would not be able to achieve alone, as does the company’s published document about its CSR initiatives. Through CSR efforts, it can also be strongly argued the company is living out its “Make More Possible” slogan by enabling the people and organizations affected by the causes it supports. APS Group is a great example of how even if a company thinks creating a CSR plan is a daunting task, success is still within reach. [8]

Method

This brand of cleaning products uses natural ingredients such as coconut oil and soy. Furthermore, the products’ packaging is environmentally responsible and biodegradable. Since the company boasts over $100 million in revenue annually, that is proof “green” products can be commercially viable.

Image via © www.methodhome.com

Furthermore, Method demonstrates CSR focuses do not have to be separate from the products you make. Some media clips from the company that details its CSR focuses specifically highlight input from industry experts to make a bigger impact.

LUSH Cosmetics

This company sells bathing and beauty products filled with natural ‘Fair Trade’ ingredients. The brand’s Charity Pot is sold to benefit a rotating assortment of non-profit organizations. All proceeds from the Charity Pot go directly to the chosen groups, resulting in millions of dollars raised. [10]

The packaging is just one indicator of how easy it is for people to support good causes by purchasing these black, lotion-filled containers. LUSH uses the labels on the top of pots to inform consumers who the recipients are by clearly stating the designated charity concerned.

Image via © www.lush.co.uk

The brand also has a fund that supports communities which produce fairly traded goods. It was launched in 2010 and borne from a desire the company had to do something more than just use fair-trade ingredients in their products whenever possible. [11]

Charting the Results of Your CSR Strategy

It can sometimes appear somewhat difficult to determine with certainty whether your CSR strategies have achieved the desired outcomes. One of the more effective ways you can answer that question is by engaging an independent research firm, with specialist expertise, to rank certain aspects of a company’s CSR performance, from human rights to the environment and community. [12]

Additionally, you can check effectiveness through various metrics [13] such as:

• Environmental indices for pollution or air/water/soil quality
• Quality and quantity of mentions in media outlets
• Measurements for the quality of life within a society, such as literacy rates, life expectancy and incidences of disease, plus mental, physical and emotional heath. The latter could be gauged through feedback surveys given to workers
• Indicators of the company’s economic health by way of profits, growth, and stability, before and after a CSR campaign launches

In conclusion, customers are becoming increasingly hyper-conscious of how and where they spend their money. Recent research also indicates this trend is strongest among Millennials, the largest consumer segment in terms of buying power. [14] Specifically, 91 percent of Millennials actively switch to brands that support a worthy cause, and abandon the brands that aren’t perceived to have an authentic contribution policy.

In addition to boosting your customer base and potential profits, a well-developed CSR plan could strengthen your relationship with suppliers, increase competitiveness in the marketplace and help you cut costs by becoming more aware of risks. Therefore, many business leaders have come to realize it’s short sighted to not be involved in corporate social responsibility.

Key Takeaways

• Customers are typically willing to pay more for products from companies associated with strong CSR brand strategies
• CSR goals vary depending on a company’s values and the composition of their stakeholders
• A good CSR plan should both benefit the business and help society
• The CSR plan must align with a company’s business objectives
• Expert individuals or notable groups can help improve CSR strategy success
• Metrics and independent research groups can evaluate whether a CSR plan is working well

Have you integrated a CSR strategy into your organization? If not, it might be a good idea to take a look at how CSR could benefit all concerned.

Questions to Consider

• Does your company have well-defined core competencies that could translate into areas of CSR focus?

• How motivated are your stakeholders to pursue a CSR plan?

• Are there obstacles that might delay CSR-related brand strategy plans?

• Have you thought about how to tackle negative responses from stakeholders that CSR is not currently worthwhile?

• Which measurement methods will you consider using to verify your CSR brand strategy effectiveness?

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[1] http://www.nielsen.com, “Global Consumers Are Willing to Put Their Money Where Their Heart Is When it Comes to Goods and Services from Companies Committed to Social Responsibility”, June 2014

[2] http://toolkit.smallbiz.nsw.gov.au, “What is Corporate Social Responsibility?”

[3] http://www.csrinpractice.com, “What is Corporate Social Responsibility?”

[4] George Pohle and Jeff Hittner, https://www-935.ibm.com, “Attaining Sustainable Growth Through Corporate Responsibility.”, 2008

[5] Tracey Keys, Thomas W. Malnight, and Kees van der Graaf, http://www.mckinsey.com, “Making the Most of Corporate Social Responsibility” June 2009

[6] Frederick E. Allen, http://www.forbes.com, “The Five Elements of the Best CSR Programs.” April 2011.

[7] http://www.theapsgroup.com/who-we-are/corporate-social-responsibility/

[8] Lisa Henshaw, http://www.theguardian.com, “How SMEs Can Engage in Social Responsibility Programmes,” December 2011.

[9] http://www.inc.com, “How Two Friends Built a $100 Million Company”

[10] Helaina Hovitz, http://www.forbes.com, “Following the Millions in LUSH’s ‘Charity Pot’. December 2014

[11] https://www.lush.co.uk/.  “Introducing the SLush Fund”

[12] Tima Bansal, Natalie Slawinski, Cara Maurer, Natalie Slawinski, Cara Maurer. http://www.iveybusinessjournal.com, “Beyond Good Intentions: Strategies for Managing Your CSR Performance” January/February 2008.

[13] Katherine N. Lemon, John H. Roberts, Priya Raghubir and Russell S. Winter, http://www.philoma.org. “A Stakeholder-Based Approach: Measuring the Effects of Corporate Social Responsibility”, 2011.

[14] www.conecomm.com, “New Cone Communications Research Confirms Millennials as America’s Most Ardent CSR Supporters,” September 2015.