Author: Carmen Adamson
We’ve all heard the news the past few months and have been riding this rollercoaster together – the recession is coming! It’s not coming. It might be coming. Nope, it’s definitely coming.
Much like during the pandemic, CSR leaders are becoming hyper aware of the needs their community, and own employees will face during economic uncertainty. Similarly, companies are considering strategies to secure their financial stability.
We want CSR leaders to be armed with the latest data and resources to plan how to take care of their employees and give back to their communities throughout disasters or any economic uncertainty. Because we cannot prevent all bad things from happening, but we can be prepared to help.
Why Maintain Your CSR Investment During a Recession
For Brand Value
During a recession when expenses often get cut back, CSR can feel like a nice-to-have instead of a need-to-have. However, research on brand value from CSR activity during a recession indicates that companies can strategically invest in CSR and see future returns. “Because CSR initiatives result in more favorable consumer perceptions of the brand, and engaging in CSR aligns with employees’ interests, businesses should consider CSR activities as a means of increasing the value of their brand.” – The Impact of CSR on Brands During Recessions
Additionally, the Project ROI CSR Report shows that corporate social responsibility can be a key driver in firm performance. We gathered five statistics that point to the return on investment from CSR.
5 CSR Statistic About the Return on Investment
- CSR programs have shown to increase market value by up to 4 – 6 %
- CSR programs have shown to increase revenue by up to 20%
- Every 1$ in corporate philanthropy contributions can generate $6 in increased sales revenue
- CSR has shown to reduce staff turnover by 50%
- CSR programs can increase employee productivity by 13%
For your employees
Just like during the pandemic employee engagement and wellness is top of mind during a recession.
“Workers have come to expect employers to provide crisis support in the way of mental health care, financial assistance, backup childcare and flexibility.” – From Day One
As companies consider operating with a reduced head-count, burnout from more work and increased stress from financial hardships can lead to disengaged employees.
Data from Deloitte’s C-suite Role in Well-being shows that 68% of employees and 81% of the c-suite say that improving their well-being is more important than advancing their career. In our whitepaper Elevating Employees as Your Number One Stakeholder, we discuss the role of CSR in people and culture, and how CSR activities contribute to employee belonging through volunteering, and financial wellness through employee assistance programs.
Investment in employee engagement also has great ROI. A disengaged global workforce results in $7.8 trillion loss in productivity per year. – 2022 Gallup State of Global Workplace Report. The Gallup report also shows that highly engaged businesses realize
- a 41% reduction in absenteeism
- 24% less turnover
- 17% increase in productivity
On top of that employees care about corporate purpose. The Purpose Under Pressure research showed that
91% of employees said their company’s purpose made them feel like they were in the right place amid global challenges like the pandemic and economic uncertainty.
For more information about purpose through an employee lens watch our webinar with Carol Cone ON PURPOSE and the Harris Poll on-demand.
For long-term impact
25% of a company’s market value is its reputation – World Economic Forum
Corporate decision-making that only satisfies near-term financial goals will sacrifice long-term value creation. The silver-lining to a recession could be the opportunity to re-think operating and business models to invest in the necessary infrastructure for long-term sustainability. This is a great time to integrate corporate purpose and ESG into business strategies to provide a guide for priorities.
We are excited to host CECP for our bbcon super session that will help companies communicate to investors the value of corporate purpose and ESG as they navigate through a crisis. Checkout our session catalog for companies to read the description and register for this free virtual conference.
