5 Killer Stats For Making A Solid CSR Business Case
CSR as a concept is growing fast, but it still isn’t mainstream. If you’re looking to convince senior management that CSR is worth doing, you’ll need to create a solid business case.
The problem is, even the best businesses cases are unsuccessful.
Too often, they’re long winded, complex, and way too subjective to actually change somebody’s mind.
Remember, a business case is about persuading somebody else, not justifying your own views.
To do that, you need to speak their language.
You need objective, cold hard facts. Stats that even the most apathetic CEO would struggle to argue with.
Fortunately for you, I’ve done all the leg work.
So make sure you’re sitting comfortably, and get ready to load up your CSR weapon with some statistical ammunition.
1. Sustainability risks could amount to 70% of pre-tax earnings
As David Jones highlighted in his fantastic book ‘Who Cares Wins’, CSR is now entering the ‘age of damage’.
What he means by this, is companies that neglect society will be actively opposed and ‘punished’. Either by governments or by consumers.
With this in mind, the first statistic in your arsenal surrounds risk management. Nothing resonates with a CEO more than financial projections, so knowing the relationship between CSR and risk is the perfect starting point.
A report by McKinsey highlights that the regulation and reputation risks of failing to address sustainability challenges can be as high as 70% of the company’s earnings.
There simply isn’t a context whereby 70% can sound good, and suddenly the cost of running a CSR department starts to become a wiser option.
Even ignoring the statistic, you simply have to look around at how companies have been publicly smeared and shunned in order to realise why CSR is so necessary.
2. 76% of millennials consider CSR/Sustainability when deciding where to work
With the previous stat you got the CEOs attention, now you need to keep it.
Next stop: Talk about the staff.
By just 2020, millennials are expected to ‘rule’ the global workforce, accounting for 35% (more than any other generation).
In order to be profitable, every business needs to attract top talent, consistently.
If you don’t provide an environment and ethos that millennials (and generation Z) want, you’re shutting a pretty massive recruitment door.
With 76% of millennials saying that CSR and Sustainability influences their career choices, it’s crucial for long term success that businesses invest accordingly.
3. CSR is the 3rd biggest driver of employee engagement
Sure, it’s great to attract top talent, but it’s even better to retain them, and keep them engaged.
A huge trend is appearing within the CSR space. As more and more employees amongst younger generations enter the workforce, CSR is becoming something that is expected as much as it is valued.
With CSR being the 3rd biggest driver of engagement, it’s a pretty big deal.
Engaged employees are often more productive, and naturally stay with the company for longer.
From a managerial perspective, you’re saving recruitment and training costs while also maximising output.
Talk about a win-win.
4. 58% of customers will pay more for CSR/Sustainability
Moving slightly outside the realms of the office, your next quick fire stat relates to customers.
Naturally, without customers, you wouldn’t have a business.
It’s a pretty big deal then, when 58% of them say they’ll pay more for socially responsible goods.
Interestingly, this number actually rises to 74% among consumers ages 18-30.
If that wasn’t enough, the ‘premium’ that consumers are willing to pay averages out at about 20%. That’s massive in terms of financial possibilities.
Once again, future proofing your business hugely depends on how well you can integrate CSR.
Sure, there’s a big difference between what consumers say in a survey and what they actually do, but you only have to look at the rise of socially responsible companies to see how ‘real’ this consumer effect truly is.
Side note: a more detailed breakdown of this data can be found in my book ‘The Price of Profit’ – Available here.
5. 74% of companies surveyed say that CSR can boost profitability in their companies
By this point you’ve got the CEO right where you want them.
You’ve hit them with 4 killer stats, they’re stumbling around the boxing ring and it’s time to go for the KO.
Going full circle, it’s time to bring it back to money.
In a pretty extensive survey, 74% of respondents admitted that CSR can boost profits.
While the link is often indirect, and therefore argued, it’s getting harder and harder to deny by the day. Just look at the four previous stats!
When CSR is done right, it can really help long term growth.
Look at Unilever, a prime example of CSR done right.
In 2016, the Sustainable Living Plan Brands grew more than 50% more than regular brands, accounting for 60% of the companies entire growth.
That’s a massive amount, and if Unilever can make it work, so can you.
Summary – The CSR Business Case
Just like that, the fight’s over.
CSR defeats CEO in dramatic statistical encounter.
If you’ve just skimmed the entire article and have missed the ongoing metaphor, shame on you, but here’s the summary you were no doubt looking for anyway:
- Sustainability risks could amount to 70% of pre-tax earnings
- 76% of millennials consider CSR/Sustainability when deciding where to work
- CSR is the 3rd biggest driver of employee engagement
- 58% of customers will pay more for CSR/Sustainability
- 74% of companies surveyed say that CSR can boost profitability in their companies
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Hi! I’m an author and blogger within the fields of social impact and responsible business. I believe that businesses can be a force for good in the world, and this website contains my thoughts on how that can work.