What do consumers around the world think of corporate social responsibility?
- Fri, October 07 2011
- Filed under: Cause-related marketing
Today, my colleague Kate Olsen highlights findings from the 2011 Cone/Echo Global CR Opportunity Study. It highlights results from a survey of 10,000 consumers in 10 countries (United States, Canada, Brazil, the United Kingdom, Germany, France, Russia, China, India and Japan). This survey includes 10 of the 11 largest countries in the world by GDP, representing just over half of the world’s population. The report includes rich information on consumer attitudes to corporate responsibility (CR) and it’s definitely worth a full read. You can access the report here, but the headline is, consumers globally believe companies have an explicit responsibility to help change the world.
This study has important takeaways for nonprofits, especially as you are often on-the-ground partners facilitating corporate responsibility (CR) efforts. Increasingly, companies (and their CR agendas) are creating much-needed awareness for the issues nonprofits work to solve each and every day. But companies cannot solve these problem alone. Your organization has an opportunity to become a true partner to companies seeking to have a positive impact on society and the environment. Your organization has the expertise in the issue area and programs in place to drive real impact – especially if you can put the resources and network of a corporate partner behind them. The information in this report will give you better insight into why and how companies are responding to consumer demand for more CR and help you better engage with your corporate partners to affect deeper and more lasting change.
Expectations
Consumers believe that the role of business in society is to change it for the better. The expectation is that companies will consider total stakeholder value, not just total shareholder value.
• 93% say companies must go beyond the minimum standards required by law to operate responsibly and that businesses should do something in the communities in which they operate.
• 81% say companies should do even more, including
• Change the way they operate to align with greater social and environmental needs
• Support larger issues with donations & time
• Advocate for change
Issues
While the majority of consumers believe that companies have the power and duty to support several issue areas (from education to the environment to health to human rights and to hunger), economic development is the most popular. The global recession of 2009 and continued economic challenges around the world have called renewed attention to the effects of economic instability. Consumers understand that solving this problem provides the foundation to address all the other needs from poverty alleviation to food security to healthcare and so on. Additionally, when consumers see companies supporting these issues that they care about, they are more loyal, trusting and likely to recommend those companies.
Approach
Remarkably, consumers say companies should address important social issues, not by philanthropy and volunteerism alone, but by changing the way they do business – developing new core competencies and new products and solutions with double bottom line impact.
“Companies around the world are using their core competencies to create solutions to the world’s challenges, from supply chain innovations that address poverty in markets where they operate, to for-profit products and services that serve the bottom of the pyramid. This study demonstrates that not only are consumers giving companies permission to alter the social paradigm, they understand it is imperative for real change.”
Impact
By now, we are all familiar with the statistic that a majority (94%) of consumers will switch brands to one associated with a good cause, price and quality being equal. But people are taking their conscious consumerism to a new level. Consumers more and more vote with their wallets to purchase products with an environmental or social benefit. In fact, in the past twelve months more than 2/3 of consumers have done just that. And while they demand conscious products, these consumers are quick to boycott a company that acts irresponsibly or promotes inauthentic cause initiatives. Consumers can smell green-washing and pink-washing from a mile away.
When it comes to using purchasing power to support or boycott companies, consumer intention and actual behavior are well aligned. However, when it comes to donating or volunteering in support of a cause, consumer desire and behavior are farther apart. “Evidently, consumers want to participate; they may just need to be asked.”
Communications
Consumers expect reciprocal communication with companies about social and environmental impact.
• 93% of consumers want to know what companies are doing in CR
• 91% want to be heard , too
• 89% believe companies share only the positive information about their efforts, while withholding the negative
• 71% are confused by the messages companies use to talk about their efforts and impacts
• 88% say it’s ok if a company is not perfect, as long as it is honest about its efforts
Even though consumers want a dialog with companies about CR issues, they still rely primarily on traditional (one-way) communication channels to learn about corporate efforts. Product packaging, media and advertising are the most effective channels. However, consumers (89%) still expect companies to use both traditional and new media (website, social media, mobile) to communicate about CR issues.
Country Snapshot: US
American consumers want companies to have a positive impact on society, but they have differing opinions about what role companies should play, including:
• Advocate for change (27%)
• Support larger issues through donations (24%)
• Play a more limited role in society (23%)
• Change the way they operate to align with bigger social and environmental needs (20%)
American consumers also tend to be more traditional in their views on how companies can have a social and environmental impact. Philanthropy and volunteerism, especially at the local community level, remain CR priorities. The opportunity for US-based companies is to create a defined CR strategy that addresses both philanthropic priorities and responsible business practices. Then communicate those goals and progress to all stakeholders using the appropriate mix of traditional and new media channels. Consumers demand transparency and authentic engagement from companies and expect US multinationals to set the global CR example.
Comments
Dear Katya Andresen & Kate Olson,
I found your post to be a useful summary of how companies are responding to consumer demand for increased corporate responsibility. Given the extensive data provided by Cone/Echo Research Study, I cannot help but realize how important corporate philanthropy strategies are to marketing and maintaining loyal consumers. What struck me as interesting, “when consumers see companies supporting these issues that they care about, they are more loyal, trusting and likely to recommend those companies.” Cone revealed shocking data, as nearly 94% of consumers are inclined to show greater financial and social support to those companies who engage in corporate responsibility; sounds like a savvy marketing plan. Cone Communications’ executive vice president, Alison DaSilva, claims “It is expected for U.S. Companies to talk about their social and environmental impacts because consumers want to know, however–this marketing momentum will also come as a backlash when commitments are not authentic.” I agree with Alison; businesses should exercise caution when marketing corporate responsibility strategies to consumers. However, let us not forget that corporate responsibility is more than marketing; it is about impacting global issues. Gerald F. Davis, from the Stanford Social Review, discusses the opportunity for global corporate social responsibility, and he recommended corporations focus on issues outside their boundaries. To maximize the impact of corporate responsibility, corporations should “change the way they do business” by focusing on emerging markets, and creating strong partnerships with nonprofit organizations. The GRI provides solid guidelines for furthering global business, their guidelines, in combination with Cone/Echo’s CR research provides excellent framework for larger corporations to take global corporate responsibility to the next level.
Corporations should not only partner with philanthropies, they should also get involved through community service and volunteer opportunities. Are you aware of the importance of volunteerism, as it moves corporate responsibility to greater action? If companies could support causes, then send employees to volunteer. Years ago, Timberland launched an interactive corporate responsibility strategy that included employees volunteering in the community. Corporate responsibility strategies that involve employees volunteering will have seem more authentic and have a greater impact on consumer attitudes. Given the demand for increased corporate social responsibility, I think corporations should immediately take advantage of this opportunity and to help change the world. I believe that once larger corporations cultivate global issue strategies and participate in volunteerism, it is only a matter of time before smaller companies will do the same.
Thank you so much for your thoughtful comment. Volunteerism is a very important component of CSR and it is refreshing to see more attention to skills-based volunteerism and other ways companies are deepening their collaboration with nonprofit partners. I admire TImberland and other companies such as Dell, Campbell Soup, Starbucks that invest deeply in volunteer programs. I also hope smaller companies get in on the action, too! You can read more about that on Network for Good’s corporate blog: www.companiesforgood.org.