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Does corporate responsibly overcome its price tag?
By June Bradham
Nonprofit Development
Q. How did “corporate social responsibility” generate the buzz status it has today?
A. I remember once reading that U.S. Supreme Court Justice John Marshall dubbed corporations “fictional” entities. For years, they have been seen not as people with responsibilities to society or any moral standard to uphold; instead, they were soulless entities without “pants to kick” or a “soul to damn.”
But after the serious scandals at Enron, Salomon Brothers and others, this kind of responsibility to community is becoming the rule, not the exception. Now, setting a higher moral bar is a kind of risk management that averts damaging ethical slips. Nip those potential disasters in the bud by hiring smarter, giving sufficiently and purposefully and only working with other companies whose moral compass doesn’t spin around like a top when temptation arises.
Risk avoidance, though, makes it sound like the only reason to be involved in the community is to avoid bad things. Having worked with scores of corporations, I can assure you that is not true. Many businesses find that contributing to society in a positive way often yields happier, more productive employees and a healthier bottom line. After all, customers are always looking for that defining something that sets one company apart from another. Often, rolling up their sleeves and helping the community is that something.
Q. Do most employees care if their companies are socially active and responsible?
A. The short answer is “yes.” While certain things like job security, pay, benefits and professional fulfillment will likely always trump a company’s “goodness,” working for a socially responsible company seems important for most workers.
Recently, Deloitte & Touche released a study that found 72% of employed Americans would choose to work for a company that supports charitable causes when deciding between two jobs with the same location, responsibilities, pay and benefits. In our experience, many employees take that sentiment even one step further, saying that community involvement and high ethical standards are so important that they think businesses could forgo some of their profits to put more emphasis on charitable giving.
Q. Do customers care?
A. According to one of Charleston’s most well-known companies, Piggly Wiggly, “absolutely.” Rita Postell, manager of community and employee relations at Piggly Wiggly, said “customers are very concerned about ’green’ issues today. They want us to act in ways that are better for the environment. We try to live up to those expectations.”
Customers really are looking for their businesses to lead change and the ones who do lead may be chosen over competitors who prefer the status quo.
One thing businesses need to remember, though, is that doing the right thing may not always pay off immediately. At Piggly Wiggly, they’d “like to believe that all charitable giving comes back to us through customers who appreciate what we have done and shop with us as a result. However, we know that is not true. But, many organizations we support do encourage their constituents to trade with us because of our support and we know that can result in more business.”
Q. How can I convince my employees, my board and my boss that increasing our philanthropic efforts is in the best interest of the company?
A. A few years ago, the Business Journal conducted a study of Charleston business owners and found that, for the most part, they were pretty apathetic towards their community.
But in the past few years, we have been pleased to see philanthropic participation by businesses increasing; a number of our Charleston clients and colleagues have commented on some factors which drive their involvement with local nonprofits.
According to Bill Medich, senior vice president of S.C. Bank and Trust, one of the most important benefits for employees is the exposure to a unique group of thought leaders. “Charleston is home to some of the most extraordinary and talented executives, many deeply involved in philanthropy,” he said. “To serve on a board or volunteer with any of these people is to learn from top-flight, world-class execs in a new and meaningful way.” This gratifying mentorship provides training you can’t buy, all while supporting a great cause.
Perhaps the dollars and cents are tougher to quantify than the value of a re-energized employee, but there definitely is an economic argument for corporate involvement. Again, Bill Medich says, “While the reasons for philanthropic support should never be just about the economics, we’ve certainly gotten positive feedback that’s directly related to our community contributions. It may be tough to track and the effect will never be immediate, but consistent, sustainable impact can never be achieved overnight. Not with any corporate program.”
June Bradham is the president of Corporate DevelopMint, a full-service fundraising consulting firm with offices in Charleston, Greenville, Blowing Rock, N.C., and Memphis, Tenn. Send questions to cdm@corporatedevelopmint.com.
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