ACCP President and CEO Carolyn Berkowitz recently appeared on Carol Cone’s Purpose 360 podcast to provide advice and insights relevant to the current state of CSR and ESG.
Over the course of several blog posts, we are sharing an expanded look at some of the topics that Carolyn and Carol covered, including racial equity, the role of CSR within the company, and advice Carolyn has for CSR and ESG professionals at various stages of their careers.
How has the CSR function changed over the last ten years for companies? For practitioners?
The field has changed enormously since I’ve been in it, particularly in the last three years. Changes have mostly been for the good, but not always.
The most important and positive change is the ever-increasing alignment of CSR and ESG to the business strategy and stakeholders.
As companies embrace their accountability to multiple stakeholders, social and environmental impact work becomes more relevant. The stakeholder group that is currently top of mind is employees, who seek meaning in their work. The impact your company makes and the engagement of employees in the workplace is a competitive advantage for attracting and retaining top talent.
Social and environmental impact is now woven into the creation and distribution of products, services, and core business functions as society demands change. This means that CSR isn’t an add-on anymore, and ESG work can and should be done in every corner of the company, and this is becoming more of a norm.
As data about the impact of CSR on employee engagement grows, more lines of business want more impactful programming. The programming is expected to address the new needs of the workplace/workforce.
Finally, measurement matters, including data on both community and business outcomes.
The challenge is that this is demanding work – and while activity and engagement continue to grow, too often, the expectation is to do more with less. I’m worried about burnout in our field, and it is a very real thing.
There are a lot of terms used – purpose, corporate social impact, CSR, ESG – which do you prefer and why?
It’s important to know that each term means something different (except CSR & Corporate Social Impact). They are interconnected but different things, and companies should be engaged in all of them.
Purpose is the company’s reason for being beyond profit. What good does the company’s core business do in the world?
ESG (Environmental, Social & Governance) has a specific set of actions, a focus on reporting and disclosure, and creates financial value for investors. It is not just about doing good but about not causing harm.
CSR/social impact is about resourcing and partnering with communities and the public to improve stakeholder circumstances.
ACCP is often asked to be the judge of what the field is called. Different names imply different corporate priorities, and the name a company uses gives a clue about what is most important to the company. I suggest that you adapt to whatever YOUR company calls it, then notice the implications of the name over time. Why do you think they call it that?
When we asked our members what their company named the function, the answers were inconsistent. The term that got the most votes was CSR (23%), then Corporate Social Impact (17%).
What companies are leaders in the CSR function? Why do they excel?
Walmart does groundbreaking work that covers many dimensions of CSR and ESG with very focused, well-resourced programs. The company is vast, however, even for a company their size, they are strategic, authentic, and impactful.
Their Center for Racial Equity is one of the most innovative approaches I’ve seen, with a $35M investment in four areas: Finance, Health, Education, and Criminal Justice. What’s unique is that the Center’s work is integrated internally and externally, so they practice what they preach.
Their CSR and ESG work is aligned closely with their business, addressing opportunities and challenges in their sector, operating and supporting sustainability, and strengthening local communities.
Gilead Sciences’ purpose is to create a healthier world. The medicines they produce are primarily in virology, and they are one of the largest manufacturers of HIV and hepatitis medications. Gilead’s innovative and impactful work focuses on HIV prevention and health equity, especially in the Southern US. Their focus on access to healthcare and bringing more Black leaders into the field is powerful. That is why the CSR team at Gilead won a 2022 ACCP Purpose Award.
I admire Gilead Sciences for its bravery. They are very forthcoming and direct about the root causes of sexually transmitted diseases that are sometimes considered taboo. Their words and actions challenge powerful societal norms, creating social impact.
They have a very diverse CSR team, appropriately funded and staffed, and represent their grantees’ lived experiences and the populations who use their products.
Owens Corning has long been a purpose-driven company with solid buy-in from the CEO and senior leadership. Owens Corning earned the #1 spot in 3BLs 100 Best Corporate Citizens for the last four years, a testament to their sustained commitment to the function and the broad engagement of their employees and communities.
What areas within CSR are companies challenged by?
Our field faces challenges threatening to slow momentum and the trajectory of the progress we’ve made in the last ten years. There are three that stand out:
- Resources, resources, resources! Expectations are continuing to increase, but teams remain understaffed and underfunded.
- Despite the overwhelming evidence that the function adds business value, CSR is still too often first on the chopping block during economic swings.
- Despite commitments from CEOs, there is a limited understanding of CSR. And new research shows that CFOs aren’t convinced about the business value of ESG.
ACCP released your 3rd Annual CSR Insights Survey with Rocket Social Impact in 2022 with insights on the economy, organizational management, ESG, and DEI. What are the major takeaways from this report?
- 80% said expectations and demand continue to rise without commensurate resources and support. The two highest demands are more integration with ESG and impact measurement, and 83% don’t have sufficient staff to meet the demand. 75% don’t have a sufficient budget.
- 90% are experiencing significant changes including increased integration (ERGs, DEI, ESG), structural changes (often to whom they report), and considerably more exposure, and accountability, to the C-suite and board. Change has become the norm.
Was there anything that surprised you or challenged an assumption you had?
There weren’t many surprises. But one that is interesting is that 58% believe their teams have gaps in the experience and expertise required for the work ahead. The areas most frequently mentioned were in ESG and DEI expertise and a lack of lived experience on their teams.
What are your recommendations for running the CSR function with tight budgets and few staff?
- Streamline, and be ruthless about it – pick a few things and do them really well. For example, narrow the focus, pick the most relevant engagement programs, and/or collect and report on only the most important and common data.
- Invest in building the capacity of “ambassadors” around the business who champion CSR and can be your arms and legs in local markets.
- Make the case regularly with data. This should include your own company’s data including the employee engagement survey that you cross-tab with the components of engagement. It should also include data and research from outside sources, including ACCP. Tailor your case to different leaders and address the specific issues each faces, e.g. Risk, HR, Marketing, Business Development, etc. Adopt engagement strategies that serve as talent development and help leaders understand the multiplying impact.
- Be honest before the decision is made about what the group can accomplish. Without understanding the choices they are making, your leadership will expect business as usual and more than last year.
What skills are needed to lead the CSR function internally?
To be successful, CSR practitioners at every level need to stay current on CSR and ESG trends and have strong soft skills, including:
- Expertise, a willingness to listen, and a desire to keep learning in a fast-changing environment
- Learn the business of the business! Ask questions of colleagues and listen well.
- Strong EQ, including self-awareness, empathy, self-regulation, and social awareness.
- Confidence. You will work closely with senior leaders and associates across the business. There is skepticism about the business value of our work, so our teams need to project the value through their own professional presence.
- Be able to make a clear business case, articulate why, and earn your way into the room.
- Be able to listen to business issues and be creative in designing programs that respond to the issues
For managers and team leaders, consider these leadership skills:
- Coach, teach, and train your people.
- Trust in your people, clarify direction and expectations, be clear on decision-making authority, and give it away.
How can CSR leaders earn the trust of the C-Suite and Board?
- Start by speaking their language and translating your work into expressions of business value.
- Be prepared with internal and external impact data. Start with the contribution to business results, and if you have the opening, address community outcomes.
- Provide both numbers and stories to appeal to both the head and the heart. For each data category, have a human story ready to share about the people inside and outside the company that your programs touch.
- Demonstrate that you understand and take seriously their concerns. Build a track record of competency and responsiveness first.
Click here for the full podcast. We will be highlighting more of Carolyn’s episode in upcoming blogs.