Well-designed corporate social responsibility programs increase revenue by as much as 20 percent, command price premiums up to 20 percent and increase customer commitment by as much as 60 percent, according to a study commissioned by Verizon and Campbell Soup.
Project ROI, conducted by IO Sustainability and Babson College, found that in addition to having a positive impact on sales, CSR programs increase shareholder value and improve employee productivity.
Project ROI analyzed existing research and data to assess CSR’s value to society and to businesses’ bottom line. It outlines a roadmap of best practices for companies that want to improve the effectiveness and authenticity of their CSR approach. Project ROI further proves the value of CSR in driving employee satisfaction, productivity and retention, and provides investors and community leaders with proof points for investing in or doing business with a particular company, Verizon says.
Other key findings:
Corporate responsibility nurtures, grows and protects brand and reputation value, potentially by up to 11 percent of a company’s total value.
Over a 15-year period, companies with effective CSR programs have on average increased shareholder value by $1.28 billion. There is also an increased potential valuation for companies with strong stakeholder relationships of 40 percent to 80 percent.
Companies with a strong CSR commitment can see increases in employees’ productivity by as much as 13 percent. In addition, these companies can experience reductions in turnover by as much as 50 percent, with workers willing to take up to a five percent pay cut to work for a company doing CSR well.
Yet, as the study also finds, it is not enough for companies to simply conduct CSR programs; they must do them well. Companies that fully commit to doing CSR are rewarded by their customers and investors, while those that are viewed as insincere or dabblers do not benefit from CSR or may lose market share and customer loyalty.
Google has the best CSR reputation according to Reputation Institute’s annual CSR RepTrak published in December. Microsoft, Walt Disney and BMW are the no. 2, 3 and 4 companies, respectively, with the best CSR reputations globally. Apple, Lego, Volkswagen, Intel and Rolex (tie), and Daimler round out the top 10.