This article was originally published on Nov. 27
What should you do next… Give up? Fight for it?
Or, you can prove them wrong.
We all know that it’s good business to do good business. It’s been proven time and time again. Yet, when it comes to investing in corporate social responsibility, we’re still arguing its value and presenting the good old business case. While this might be a frustrating situation, having to prove the worth of something inherently invaluable is something you’re likely to come across at some point in your CSR career. So, how do you do it?
There are many reasons that a CSR practitioner might need to make (or re-make) the business case for their programs. Understanding the why will help you frame your argument. Step one: figure out why you’re making the case for an increased budget. Is it to:
- Build a new CSR strategy
- Create a new program altogether
- Advocate for a larger team
- Head-off a new leader asking why the company invests in CSR
- Supplement potential budget cuts
- Fund a system that can manage CSR data
Start with the Big Picture
Anyone in this field is aware of the benefits that CSR programs offer a corporation. But sometimes, our leadership teams may need a reminder. CSR increases employee engagement, productivity, and retention. Happy and engaged employees produce better business results than those who aren’t engaged.
Social Responsibility also yields increased consumer support and a better company reputation. Both of those things affect the company bottom line positively. Linking CSR business goals and your company’s bigger picture helps executives understand the need based on what is important to them: making money!
Don’t worry, this isn’t a bad thing. After all, if your company didn’t make money, there wouldn’t be a CSR program to engage!
Think Data Might Help?
- 55% of consumers are willing to pay more for a product from a socially responsible company.
- 89% of consumers would switch brands to one that is associated with a good cause, given similar price and quality, compared with 66% in 1993.
- 76% of employees consider a company’s social and environmental commitments when deciding where to work.
- 83% would be more loyal to a company that helps them contribute to social and environmental issues (vs. 70% U.S. average).
- Companies with an average of 9.3 engaged employees for every one actively disengaged employee experienced 147% higher EPS compared with their competition.
- Companies that increased total giving by at least 10% between 2014 and 2016 saw increases in revenue and pre-tax profit, as opposed to all other companies, which actually saw decreases in both metrics.
Speak the Language
Spend some time getting to know your executive team and the decision maker that oversees CSR. Understanding what is most important to this group will steer your presentation in a way they appreciate. Their primary concerns might be employee retention, reputation, risk mitigation, culture, or other areas. Knowing the overarching goal of this group will lead you to use the right support for your ask in CSR funding.
It’s great to understand how CSR affects the bigger picture, but your executives are probably wondering: what do our employees want? Be sure to survey your employees to understand what this key stakeholder group wants and needs from your company. Use that data and their thoughts as you speak to the executive team. There’s no denying the power of a collective voice. If the entire company is calling for support through a company match, for example, it would behoove you to mention that fact to the leadership team.
Do the Math
While we want to believe that making the business case is about intangible benefits, in most companies, that just isn’t the case. To really speak the executive team language, it’s important to do some homework beforehand and calculate the Internal Return on Investment of CSR for your company.
Estimated Turnover Savings
- [$XX,XXX] $/year
- x 131% benefit costs
- x # of employees
- x 38% turnover cost
- x 20% current turnover rate
- x 25% turnover rate reduction
TOTAL SAVINGS: $X,XXX,XXX
- Average employee salary.
- Employer costs for employee benefits according to statistics from the U.S. Bureau of Labor Statistics (2014).
- Your employee headcount according to HR.
- US Labor Bureau reports average turnover costs at 38% of the annual salary.
- Your turnover rate input according to HR.
- It is reasonable to expect up to 25% reduction in turnover rate.
Find and Leverage Internal Resources
In order to accomplish your original goals for your CSR program, get creative! Think of how you can partner with other departments to achieve the same end-goal without increasing costs as significantly. Need to get the word out about your giving campaign? Recruit marketing. Need to properly vet a potential nonprofit partner? Ask your financial experts to look at the 990. Need someone to help spread the word and increase participation across offices? Recruit CSR champions. For many CSR departments, resources are stretched thin. Finding innovative ways and looking for help internally can help reduce your overall ask and increase the likelihood it gets approved.
When your board says they don’t have the budget, don’t stress! Take a look at these tips, remember that you know exactly how to make the case for CSR, and educate your decision-makers about why more funding would be integral to engagement success within your company.