Written by HRCap, Inc.
Thursday, May 25, 2022
What is Corporate Social Responsibility?
Corporate Social Responsibility (CSR) is the social responsibility that a business has in society.
With many employees reassessing their values, employers are actively evaluating theirs and investing time to create strong Corporate Social Responsibility programs. In fact, about 90% of companies on the S&P 500 index published a CSR report in 2019, which is 70% higher compared to 2011.
What is ESG and what is the difference between CSR and ESG?
CSR and ESG are terms often used together in the same context, but it's important to note that they are different in definition. CSR is the written policy to show the values that the company is following, whereas, ESG is the measurable goals on how a company tries to achieve those policies.
ESG (Environmental, Social, & Governance) evaluates how the company's practices and actions align with the three critical indicators. The ESG criteria focus on measurable results that direct investors in which companies place their investments.
Environmental responsibility is how well a company practices conservation and protection of the natural world.
Social responsibility measures the impact the company has on employees and on society.
Corporate Governance assesses the way in which the board and management conduct and navigate their business.
A company's CSR would be its commitment to be more environmentally responsible, while the ESG would be to increase its use of recycled materials by 30% and plant one million trees in 10 years.
What are the Benefits of CSR?
It is important for companies to consider not only their financial gain but also their responsibility to the society, the environment, and its employees. Creating a CSR program not only positively impacts the society and environment but can also benefit companies in many ways.
1. Employee Satisfaction
Nearly 90% of executives believe that CSR builds a strong sense of collective purpose, which then drives employee satisfaction. This is further supported by a survey that shows that 93% of workers believe companies must lead with purpose.
2. Employee Productivity
A 2015 Project ROI study shows that a good CSR program drives up employee productivity by 13%.
3. Employee Retention
90% of employees are more inspired, motivated, and loyal to a business with a strong sense of purpose, while companies with CSR programs experience reductions in turnover by as much as 50%.
4. Employee Referral
92% of employees would recommend their employer if the company has a strong sense of purpose.
As such, by implementing a stronger CSR program, companies are able to create a meaningful purpose that benefit businesses, employees, and society as a whole.
HRCap Engagement Lab
In our monthly HRCap Global Engagement Lab Survey, we observed that 100% of our employees felt engaged this month, compared to 96% engaged last month. We also collected survey data on how our employees are engaging in outreach activities in their respective communities, and found that these were some ways that they are giving back and contributing:
Donating - providing food for local communities or sending supplies overseas to Ukraine
Raising Awareness - advocating for special needs children and mental health
Volunteering - advising students on career development, helping at a local library, teaching as a church youth group teacher, tutoring ELL students, giving back as an HR advisor
To give back more to our community together as a unified community, HRCap has incorporated weekly outreach meetings. Inspired by our employees, we are starting a team fundraiser for our local food bank in New Jersey, planning career seminars to educate local students, and volunteering our time together to charities and non-profit organizations that our teams are passionate about.
Planning for outreach has brought our team closer through collaboration and engagement. We have definitely seen an increase in satisfaction, productivity, retention, and referral as a positive impact of our weekly outreach projects supporting missions that strongly resonate with our individual and collective values. Our teams have echoed such sentiments by sharing the following:
We are all encouraged and motivated to work towards the goal of giving back to the community through our growing CSR initiatives. We hope to share and promote outreach events going forward, and further encourage everyone to give back to their respective communities as well.
Source: HRCap, Inc., HBS, HBR, SHRM, Porter Novelli
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