Many companies 'do' corporate social responsibility (CSR), many companies shout about CSR, but few know what it really means for people and lives in everyday communities.
A Department of Business, Innovation and Skills consultation on realising the full benefits of corporate social responsibility (CSR) has recently closed. It asks two big questions 'should there be more robust measurement of CSR programmes to really understand the impact and where they add value' and 'should big businesses be made to invest?'
It's not just in the UK where Governments are taking a keen interest, Western and Emerging markets are starting to realise the importance of getting CSR right. The Bombay Stock Exchange (BSE) and the Indian Institution of Corporate Affairs (IICA) have signed an agreement to collaborate on developing a corporate social responsibility (CSR) index to assess impact and performance of companies listed on the BSE in CSR activities. So, how are companies in the UK responding?
In July 2013 Lloyds Banking Group commissioned nef consulting to understand the real social impact of its CSR programme and what companies could do to strengthen and deepen relationships with communities and individuals.
Our report highlights three ways to improve CSR for the benefit of business and its beneficiaries:
1.CSR to be robustly measured to demonstrate the real social value investment
2.CSR to be transparent about the impact investment
3.Companies can use the power of their brand as well as investment to promote good causes
Having interviewed Community Fund beneficiaries and Lloyds Banking Group employees, nef consulting found that, for some, the Community Fund was a lifeline with 88% of beneficiaries stating that local changes could be attributed to the investment.
This statistic is unsurprising, perhaps. However, what is interesting about the research is the extent to which charities value the involvement of the Lloyds brand as much as they value the extra money. 92% of charities felt that there was an increased awareness of their work within the community. Beneficiary, Calderdale SmartMove, said that being involved with the Community Fund meant 'they could use the Lloyds Banking Group name. They were able to say they were a community champion for Lloyds in Yorkshire and Humberside, which helped raise their credibility with funders.'
More broadly, our research shows the importance of moving past the premise that the act of giving alone can create change. Using data from projects and after projects have been completed helps to scrutinise the impact created. In the case of Community Fund, local promotion of every shortlisted charity and community group is just as important as the investment itself.
David Blunkett MP recently argued at a Parliamentary inquiry that we want corporate bodies to do CSR but we don't want them to boast about it. And he is not alone in his misgiving of companies bragging about their involvement and only being interested in being seen to be doing the right thing.
However, the nef consulting research suggests that for the charities involved the opposite can be true - individual beneficiaries and charities do want and need corporate companies to shout about their involvement as it helps significantly in promoting their messages to a wider audience. Company involvement in the promotion not only helps the message go further, but it can also build mutual trust and respect between the community and the company.
Switched on big businesses are waking up to the benefits to their business of evidenced-based CSR programmes. Introducing standardised CSR reporting will make effective CSR more widespread. It will not just help the public and companies to understand the real vs. the claimed impact, but it will also build trust of the public in the companies who can continually improve the impact of their CSR programmes. Ultimately, this enables companies to improve their relationship with communities and the public at large.
The 2013 Lloyds Bank Community Fund public vote launched the end of September. 1,500 community groups and charities and 450,000 people across the UK will benefit. Voting is open until 1st November 2013. To find out more and vote visit www.lloydsbank.com/communityfund