The health and social crises of the last few years have thrust the need for corporate social responsibility (CSR) into the spotlight. But with a possible recession on the horizon, many CSR departments are feeling the temptation to pull back and tighten their charitable budgets.
That would be a mistake, and not just because society needs corporate philanthropy more than ever—but because your business can’t afford to lose the benefits it offers.
CSR activities benefit companies MORE in times of need.
Research has shown that CSR activities increase your brand’s quality and value MORE during recessions than when the economy is good. Putting, or keeping, your money where your mouth is during economic downturns distinguishes your brand when other companies are cutting back on philanthropy and doing less for their communities.
According to a recent longitudinal study, researchers demonstrated that corporate support for customer and societal interests in times of need resulted in increased perceptions of brand value. In short, CSR initiatives during recessions provide a signal to customers of higher brand quality.
Here are 7 tips your CSR team should keep in mind when preparing for a recession.
1. Optimize Your CSR Strategy: Better Align Your Philanthropic Interests and Business Goals
Getting clarity on your social impact strategy can help your team focus on the most effective ways to benefit the causes that matter most to your company’s mission and coworkers’ interests. This can start with a simple exercise to determine which nonprofit programs best align with your company’s overall goals. From there, you can (1) determine the most aligned organizations, (2) establish gaps between company goals and philanthropic efforts, and (3) distribute funds accordingly. At the very least, you’ll find better ways to impact society than donating to the board chair’s alma mater.
2. Volunteering: Increase Social Impact While Minimizing Expenses and Motivating Your Team
Volunteering is one of the most underrated ways of increasing social impact. Companies, employees, and nonprofits all benefit in tangible ways, from skill development to capacity building. Investing in traditional volunteering, skilled volunteering, and pro bono will increase your company’s impact while making employees feel more fulfilled. If you can offer PTO and assistance with tax deductions for their volunteer time and resources, all the better!
3. In-Kind Donations: Provide Surplus Equipment to Organizations That Need It
Similar to volunteering, in-kind donations offer capacity building for nonprofits benefiting from equipment companies already have on hand. It helps a business move extra stock, keeps the warehouse up to date, and comes with tax benefits. By donating excess inventory instead of discounting it, you’re helping nonprofits do their best work while improving the value of your brand and its products. Win-win!
4. KPIs: Advance Your Impact By Improving Your Philanthropic Efficiency
Metrics like social return for investment (SROI) can help your team identify high-performing programs that support the causes and communities your company cares about. This will leave you more confident and better prepared for tricky budget conversations that can spring up in tough economic times. An SROI analysis helps you review the efficacy of your nonprofit partners, but remember to compare apples to apples as much as possible.
Pro tip: Focusing on policy and systems change can yield a greater impact for a smaller financial investment compared to investing in direct service programs, albeit over a typically much-longer time horizon.
5. External Benchmarking: How Well Are You Doing Compared to Your Peers?
Benchmarking is a clear-cut way to demonstrate your company’s social impact to the leadership and board, secure your budget, and protect your CSR programs in challenging times. It can help you analyze how your efforts compare to your peers’, as well as how to improve your impact by highlighting new philanthropic opportunities.
6. Impact Measurement: Substantiate the Value of Your CSR Program
While we may be biased, we believe there’s no better way to secure funding for your programs than by proving the results you have had thus far. Being data-driven applies to all aspects of a company’s efforts, and philanthropy shouldn’t be an exception. Measuring the impact of your corporate philanthropy, employee engagement, in-kind donations, and other CSR efforts demonstrates their value to society and your business. Pro tip: True Impact’s lite reporting option can capture the impact of smaller community investments for less time, money, and effort.
7. Outsourcing: Expand Your Team’s Productivity and Flexibility While Reducing Liability in a Volatile Market
Not only can outsourcing services extend the manpower of your team, but it can also offer the staff consistency companies need to continue their work. Partners like True Impact can provide the continuity your team needs to deal with turnover, hiring freezes, pivots in strategy, and even crises.
The Power of CSR as a Recession Buffer
As the world braces itself for the upcoming economic downturn, investing in your CSR programs may give you a buffer to come out of the recession stronger. Looking out for society’s best interests can improve your brand’s perceived value and quality, motivate your team, and give your nonprofit partners the resources they need when they need help most.
Are you planning on adapting your CSR strategy to prepare for the possible recession? Schedule a free consultation with our team to get on the path to aligning your business and philanthropic goals.
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