David Saul, MD of Business Environment, takes a look at how CSR is becoming an increasingly important driver for employee engagement.
The methodology adopted by the Sunday Times to compile its 'Best Companies to Work for' lists underlines a fundamental truth about corporate social responsibility (CSR) and how a business’s commitments in this area can affect its employees’ job satisfaction.
The Sunday Times survey gauges employee satisfaction across eight key measures, meaning it goes beyond the more obvious areas such as work-life balance and pay and benefits.It's no surprise that employees tend to be happier at companies offering high pay and a generous holiday allowance, but the diversity of the Sunday Times survey is recognition that creating a great working environment requires more than this.
Indeed, employees are asked whether profit is the main thing motivating the business, whether the company makes it easy to be eco-friendly and if the company supports charities or good causes.
Questions such as these get to the heart of a company's ethos and increase the likelihood that a member of staff will be proud of the organisation they work for and motivated to give their all during a working day. Of course, the main reason businesses should be committed to CSR is because acting as a responsible corporate citizen is simply the right thing to do. Beyond this, many view their efforts in this area as an important step in managing their reputation among external stakeholders.
The role CSR plays in enhancing a company's reputation among its own employees, subsequently boosting their motivation and engagement, is perhaps underrated – which is particularly problematic for companies that are inconsistent in their approach to implementing CSR initiatives. For instance, employees at a company that has no policy on recycling, but stages an annual litter clean-up, might become cynical about the genuineness of their firm's desire to make a positive difference to society. Likewise, this could be true of a firm that encourages volunteering, but has made no attempt to reduce its energy use.
A business could well be genuinely committed to improving society in the one area in which it focuses its efforts. Its employees, however, are likely to view a one-dimensional approach to CSR as an indication that the activity is motivated mainly by a desire to manage the firm's reputation among external stakeholders.
Because of this, CSR needs to be embedded at the heart of a company's ethos, rather than viewed as a mere add-on. Instead, it should dictate the way the company operates across the board and employees should truly feel empowered to get involved in relevant initiatives. This might often involve giving staff time off work, on top of their usual holiday allowance, so that they can support a chosen charity or good cause.
Otherwise, simple steps such as offering a financial incentive to staff who cycle to work or ensuring recycling points are installed throughout the office can prove important – empowering employees to be more sustainable, but also underlining a company's genuine and wide-ranging CSR commitments.
With research by accountants PwC revealing that employee turnover is costing UK firms over £40 billion a year, the business case for effective employee engagement, including CSR, is very strong indeed. This case is strengthened further by a recent study by the consultancy Corporate Citizenship, which revealed that enabling employees to participate in charitable initiatives could deliver returns to businesses by reducing training and development costs.
The role CSR can play in engaging external audiences is well documented, but a recent study by Edelman, and Young & Rubicam, showed that 87% of UK consumers expect companies to consider their impact on society as much as their own business interests, while more than 70% of people make a point of buying from companies with views similar to their own.
Ensuring a comprehensive CSR policy is in place and embedded at the heart of a business can not only enable companies to make a genuine difference to society, but also deliver a tangible benefit to the firm. Businesses worried about the cost of implementing this should recognise how it can deliver true win-wins, engaging and improving brand reputation among external and internal stakeholders, contributing to the development of employees and ensuring they are proud of the company they work for and motivated to perform at their best.
This article first appeared on the HR Magazine website.