Consumers’ attitudes toward businesses have changed in the past decade. Not only do we look at brands and companies in terms of how they could benefit our lives with their products and services; we also look towards how they are benefitting the wider world. Whether the cause is one of health and wellbeing, the environment, equality and justice across the globe, or even just boosting the local area, the corporate social responsibility of a business is a factor for consumers. But just how important is corporate social responsibility in influencing consumer choice?
Corporate social responsibility has been proven to be increasingly important to consumers. Indeed, 94% of Generation Z — those born from 1995 onwards, who comprise the next wave of consumers and influence older generations with their choices and purchases — believe companies should address critical social issues. Similarly, 55% of consumers are prepared to pay a bit more to buy a product or service, if the company is doing good. So, it’s clear that a company’s corporate social responsibility is important for consumers and will continue to grow in importance as the consumer demographic changes.
The UK has seen a wide range of CSR initiatives from different brands and different causes. McDonald’s has toilet facilities that save water, reuses oil for its lorries, and has made a move to replace plastics with less harmful materials. John Lewis & Partners have schemes that give back to their employees in the form of bonuses, while Gregg’s recently shared its massive profits for 2019 with staff members, all of whom are considered hourly contract employees. In partnership with charities such as Samaritans, The Big Lunch, and Time to Change, PG Tips has the Share a Cuppa campaign to try to end loneliness and encourage people to talk about mental health issues.
Sharing a cuppa provides an opportunity to talk 🗣️. On #TimeToTalk Day give tea a chance and choose to talk about mental health. If you needed to talk, who would you reach out to? 💚 #CuppasTogether#TimeToTalkDay #MentalHealth #MentalHealthMatters #HowAreYou pic.twitter.com/pePB4h6Lqp — PG tips (@PGtips) February 6, 2020
Moreover, we can also see that having business leaders involved in a cause can draw greater attention to it and give it the platform necessary to achieve its goals. The Bill & Melinda Gates Foundation helps many causes, including gender equality and global health, and provides a platform for them. Meanwhile, businessman Tej Kohli threw his real estate business pedigree behind the cause of global health challenges and aims to eradicate corneal blindness by 2035. His platform shedding light on this cause helps bring it to the attention of those who otherwise might not have known about it.
In the wider market, a good corporate social responsibility plan can improve market value by 4-6%, according to a study performed by Project ROI, which was set up by Verizon and the Campbell Soup Company. This is a strong signifier to the industry that CSR is beneficial, and could help smaller brands catch up to market leaders. This can influence business on a wider level and shows that being better for the wider world and putting money into philanthropic needs can actually improve the value of a business. The more businesses are seen as becoming more profitable due to their corporate social responsibility, the more others are likely to follow suit — if for no reason other than keeping competitive with their rivals.
Not only is corporate social responsibility important for consumers and not only does it signal a good company to interact with, but it can also help the profitability and market value of brands and businesses themselves. This is further demonstrated by examples such as major corporation Unilever, who have reported their CSR schemes as improving their profitability. Indeed, their highly CSR-focused brands were seen to grow 50% faster than their brands that didn’t have a marked CSR plan. So, it’s clear that corporate social responsibility is actually good for business. Let’s make good use of it.
