Posted on / by Jess Harding / in Social Responsibility

Top 5 Corporate Social Responsibility Mistakes

Social Responsiblity

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Top 5 CSR Mistakes

Social Responsibility or Corporate Social Responsibility (CSR) is a strategy that smart organisations use to leverage their positive influence in society. Less than a decade ago, it was the domain of  mostly the bigger players that operated in this space, however now smaller organisations are equally driven to give back and have a positive impact.

The benefits of being a socially conscious organisation far outweigh the investment.  At Doing Good Rewards, we’ve seen organisations attract big contracts and deals from new clients who’ve wanted to partner with a ‘doing good’ organisation.   We’ve seen an increase in staff morale because the team came together in experiences shared during charity events.

When implemented correctly, Social Responsibility allows an organisation to demonstrate it’s core values and generate goodwill within their community. Here are 5 of the most common mistakes businesses make:

1. Cost Centre versus a Profit Driver

The traditional business model means that expenses including any charitable contributions (in money or kind) are considered a cost centre to the business.  But why?  As with any other component of business, it is essential to expect a return from your charitable giving, why shouldn’t you expect a positive return on your investment?

The mistake most businesses make is making charitable donations and simply claiming it as a tax deduction.  But having an effective social conscious strategy should contribute to the growth and profitability of your business.  To reject the benefits of your giving and hard work is to miss out on leveraging the opportunity.

There are numerous business benefits including financial and non-financial returns that come from an effective social responsibility strategy.  Considering the impacts on attracting staff, engaging employees and customers, and brand differentiation are just some examples of the profit drivers back to your business.

2. One Way Transactions

More often than not when donating to a charity, it is mostly a one-sided transaction where a donation is made and a receipt is received.  But for the ‘socially conscious’ business it should go beyond that.  It is in the interest of all parties that there is an experience, a connection built, engagement developed and that the relationship continues beyond donation.

Without building this relationship no interest is generated internally and dedicated resources will be limited.  Remember when choosing a charity, it should align with your company values and be open to building a partnership thus helping to ensure connection endures.

3. Choice of Charities

When selecting which cause to support often businesses will do research into who operates in the space they wish to contribute to.  By doing this, more often than not the charities that will come up are the bigger, more well-known organisations.  But in supporting them, your contributions will be a mere drop in the ocean of what they receive.  Thus the connection to the charity will be limited but imagine the impact your contribution could have on a smaller, lesser-known charity or cause.

The impact you can make on a smaller charity can be game-changing and can foster a deep ongoing connection between both parties.  The charity sector is a crowded and competitive environment, so assisting a smaller charity with either expertise or donations will see a greater return to your business.

4. Lack of Involvement

Involving your stakeholders such as employees, suppliers, customer and clients in your charitable journey from making the decisions on who/what to support, allowing them to contribute either financially or in kind will assist in engaging everyone in the process.

If the CEO or Manager simply chooses on behalf of everyone, even though the intention is pure the ‘buy-in’ to the process is simply not there.  Bringing everyone along on the ride and letting them feel ownership and pride in what is achieved and the impact made will multiply the benefits.

5. Failing to Communicate Impact

Any contribution you make to a charity partner needs to have a tangible and measurable outcome or return.  More often than not businesses simply report charitable donations as a dollar figure and employee volunteer days in a financial year report but this is effectively meaningless.  To have real meaning, the impact must be communicated.

By identifying something achieved; the difference made, the impact on lives or to the charity and reporting this effectively you gain greater traction.

Communicating the impact allows people to connect to business and for your employees or customers to feel that your company is making a difference and so are they.  This builds the connection to your community and differentiates you from your competitors.

Smart business people and organisations are realising that doing good for the world and having a social consciousness is good for business.  By avoiding these common mistakes, your philanthropy can build internal and external relationships, generate trust with customers and differentiate your brand.

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