3 reasons why corporate social responsibility is a vital part of a successful business

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The recently released 2018 Global Human Capital Trends report by Deloitte showed that only 23 per cent of decision makers in Australia said social responsibility is a top priority, while more than half (53 per cent) confirmed it is not a focus. This is alarming.

As a community, we are facing a raft of compounding social issues such as soaring house prices, increased cost of living, and high youth unemployment.

As a result, many non-profits are facing increasing pressure from many directions — on one end, the government is making significant funding cuts that provide the imperative financial support they need to keep services operating, and on the other it’s increasing demand from the communities they support to provide much-needed and often urgent assistance.

As such, businesses large and small must step up their social responsibility efforts — not only because it is the right thing to do, but because giving back is now a vital part of operating a successful business.

Here are three compelling reasons why I believe giving should be considered an investment, not just ‘goodwill’.

Generation ‘why’– giving helps retention

CSR is increasingly important in attracting, retaining and engaging workers, particularly our next generation of business leaders. Millennials are drawn toward meaningful work; they are motivated by challenging roles, progressive cultures and those companies demonstrating a corporate conscience. In fact, Deloitte’s study found 86 per cent of millennials think business success should be measured in terms of more than just financial performance.

They aren’t alone. Being a generous company can help your staff psychologically.

Research has shown that parts of the brain associated with reward lights up more when we give money as opposed to when we receive it.

Interestingly, the parts of the brain implicated in social attachment are also active when we give, but are inactive in pure monetary reward choices.

Therefore, giving literally makes people happier.

It also makes them better colleagues with a more attuned sense of empathy and understanding toward others. So, if you think pay rises and climbing the corporate ladder are the cornerstones of staff retention, I encourage you to think again.

These may be important, but employees are more likely to stick with a company that challenges them, gives them a sense of meaning, and enables them to feel like they are making a contribution, not just to their organisation but the communities in which they operate.

Giving safeguards reputations

How a company engages with its community is now hugely important in cultivating loyalty among customers.

In a 2017 global study, 77 per cent of consumers said they would choose to pay more to purchase from companies demonstrating community responsibility.

This shift is because we’ve come to expect less of institutions, governments especially.

Edelman’s 2018 global trust barometer found 20 out of 28 markets are considered ‘distrusters’, with Australia declining 10 points on the previous year.

In the US, 59 per cent said government was the ‘most broken’ institution, compared to business at just 7 per cent.

In an era of fake news and celebrity style politics, we’re looking more to businesses to do the right thing by society and are prepared to pay for the peace of mind.

Furthermore, when that engagement is local and relevant to the immediate community in which a business operates, the reputational benefit is even greater.

In a US study from 2017, 87 per cent of people said they would purchase a product because a company advocated for an issue they cared about, while 76 per cent would refuse to purchase a company’s products or services upon learning it supported an issue contrary to their beliefs.

Giving time comes full circle

Donating large or even small sums of money may not be a realistic option for all companies. However, giving time and skills can be just as valuable as giving money.

Likewise, enlisting social enterprises to provide services that your business is already paying for is a good way of giving back without incurring additional costs.

Two years ago, we kicked off a more concerted effort to advance our CSR commitments.

It began with us purchasing our catering from STREAT – a social enterprise that supports disadvantaged youth to gain hospitality experience and qualifications – and has since expanded considerably.

Globally, Zendesk introduced a #6hours campaign encouraging every employee to volunteer six hours of community service per year.

At over 2,000 employees worldwide that’s over 1,500 days per year. This includes a skilled volunteering program whereby employees offer their expertise to assist non-profits in areas such as web development or marketing. In Australia, our team has clocked 2,363 employee volunteer hours over the past two years – nearly double the global target.

Furthermore, a common theme evident in Zendesk’s bi-annual employee engagement surveys is how much employees enjoy volunteering. They like seeing their skills and knowledge used for a greater good, and gain a different perspective on their own situation by walking in other people’s shoes.

CSR can no longer be treated as a ‘nice to have’ in the broader sales and marketing mix; it should be a core business focus.

If you care about retaining the best talent, protecting your reputation and growing your bottom line while helping your employees feel good about the work they do and company they represent, I implore you to care more about being a community-minded company.

Amy Foo is the VP Finance and Operations at Zendesk APAC.

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