Flickr user Robert Couse-Baker (cc).
For companies, corporate social responsibility is one way to improve image and reputation.
By Yonina Gray and MPC Research Assistant Quanic Fullard - June 6, 2014
These days, consumers look beyond just products and services when conjuring a company’s brand. Consumers increasingly hold these companies accountable as active members of society with a civic duty to give back however they can, from protecting the environment to contributing to solve social issues. Employers are starting to research and place higher value on the benefits of this kind of civic engagement; businesses are also stepping up to the challenge of this civic duty—better known as corporate social responsibility or “corporate citizenship”—by including environmentally friendly and social measures in their mission statements. The Boston College Center for Corporate Citizenship defines corporate social responsibility as follows:
At its core, corporate citizenship is about the role business plays in 21st century society. It encompasses corporate activities related to community involvement, philanthropy, environmental, and governance issues. Companies that embrace it seek to strengthen their relationship with communities and build sustainable strategies for addressing large societal issues.
One of the ways that the Metropolitan Planning Council (MPC) promotes corporate social responsibility is through employer-assisted housing, a benefit that provides employer-funded financial assistance to employees who purchase or rent homes near their jobs. In challenging housing markets, this initiative bridges the affordability gap by giving employees the extra assistance they need to purchase homes in communities where their employer is invested. The strategy has been a successful tool for employee retention and recruitment, community revitalization and community relations. Employer-assisted housing can introduce a stable work force to a distressed community, and encourage additional investments while strengthening the company’s image. One of MPC’s most successful participants is the University of Chicago, which has, since 2003, invested $1.5 million in employer-assisted housing benefits. That investment has yielded over $45 million in real estate investments in the communities that surround its Hyde Park campus.
Derek Douglas, vice president of Civic Engagement at the university, believes that their investment in employer-assisted housing has been incredibly successful:
Over the past decade, the employer-assisted housing program has proven to be a distinct opportunity for the University of Chicago and University of Chicago Medicine to partner with our surrounding neighborhoods to increase opportunities for investments. When considering our institutional goals to attract and retain the best talent and contribute to the vitality of the nine communities near our main campus, employer-assisted housing just made sense. We look forward to the continued evolution of the program and its impact to both the University and the Mid-South Side.
For the University of Chicago, employer-assisted housing was an effective tool to enhance the local economies of surrounding communities through real estate investments. For other organizations, implementation of a successful corporate social responsibility strategy can mean gaining a competitive advantage or increased media visibility and relevancy, being a credible part of a national dialogue or trusted source for information and promoting some other organizational goals.
With so much information available on corporate business practices, consumers, fans and constituents can now support companies that have values similar to their own. For example, a 2010 survey by Cone Communications found that 83 percent of consumers want to support services and companies that benefit a cause. This study also found that 69 percent of Americans consider the company’s social and environmental commitments when accepting a job offer. Corporate citizenship has become a part of a company’s image.
Social responsibility is even more important to the Millennial generation. Born between 1981 and 2000, Millennials make up an estimated population of 85 Million, forming the nation’s largest age cohort ever. A recent article by Crain’s Chicago Business covered a report by ad agency network TBWA/Worldwide and TakePart, which said that 7 out of 10 young adults consider themselves social activists. These young social activists boycott or support companies with causes they care about and think more highly of firms with social goals. Corporate social responsibility has become a factor for job seekers as well: 75 percent of young social activists seek employment with companies with social goals.
In early 2014, Forbes Magazine interviewed John Paluszek, senior counsel at Ketchum, a global communications firm specializing in corporate citizenship and sustainable development. He is also executive producer of “Business In Society,” an online program platform reporting and analyzing current news on issues related to corporate social responsibility. In the interview, Paluszek outlined the five areas that will have the greatest impact on the future of corporate social responsibility, and one of them specifically spoke to the trend of younger people being more socially responsible. Paluszek believes that “The next generation of leaders will be more socially concerned and committed as employers, consumers and investors.”
A clear trend is emerging in consumer, employee and business leader sentiment: In order to remain competitive, corporations should look to adopt social responsibility goals. The benefits of corporate social responsibility have long been documented: Forbes lists brand identification, costs savings and employee engagement as some of the benefits. Companies that become corporate citizens often reap rewards such as customer and employee loyalty, which can increase the firm’s reputation and profits while granting them a wider platform to address the very issues they sought to impact.