What is Corporate Social Responsibility and why does it matter?

Why is Corporate Social Responsibility important?

Corporate Social Responsibility, or CSR as it’s also known, is more than just ‘doing the right thing’ as a comprehensive programme will benefit your employees, the community and the environment. It’s something that should be an important element of any business strategy as it’s proven not only to attract and retain employees, but also, with 91% of Generation Z (the latest consumers) stating that they prefer to engage with sustainable companies, it can also increase sales.

What is Corporate Social Responsibility?

CSR is defined by the UN Industrial Development Organisation as a “management concept where companies integrate social and environmental concerns in their business operations and interactions with their stakeholders.” Essentially, reviewing the broader impact of the company’s operation.

Why does CSR matter?

CSR is ultimately driven by consumers who are increasingly choosing to buy from organisations they consider to be ethical and responsible. Research carried out this year showed that 74% of consumers care about the environmental impact of the products they buy, and 68% are prepared to pay a premium to guarantee this. A further 68% of people believe that businesses, governments, and non-profit organisations all need to deliver more social and environmental change.

These numbers are persuasive, and the trend is only strengthening year on year, as evidenced by the Co-op’s Ethical Consumerism Report which has tracked ethical expenditure for the past two decades. In 1999, the total size of the market was just £11.2bn whereas today it’s conservatively valued at £41.5bn.  The ethical expenditure market grew by 35% between 2021 in the last year alone and the average spend on ethical purchases per household has significantly outstripped inflation, even at a time of restricted household budgets and decreased consumer confidence.

Employees opinion on CSR

Additionally, employees are becoming more discerning about which organisations they choose to work for, and many actively look for companies that operate in an ethical and sustainable way. With 61% of millennials being concerned about the state of the world and feeling a personal responsibility to improve it, and ‘Gen Z’ feeling even more strongly about the matter, this is not a trend that employers can ignore.

According to John Catling, Chief Executive of incident management specialist FMG,

“75% of FTSE 350 companies are devoting whole sections of their annual report and accounts to CSR”, but some organisations still make the mistake of simply seeing CSR as nothing more than an unwelcome box-ticking exercise.

In 2020, as employees made their way back into the workplace after the spring lockdown, a study of 2,000 UK professionals carried out in July of the same year by Go Ultra Low found that 42% were frustrated by a lack of consideration for the environment in the office. A further 40% thought that this was a result of no one single person having the ultimate responsibility for driving green initiatives within the workplace.

This has been supported by a widening focus in the employee benefits sector away from company benefits being purely financial. According to an article in HR Magazine,

“the focus of employee benefits has now shifted from financial, to health and wellbeing, with employees prioritising their work/life balance, as well as becoming more conscious of the mental and physical toll high-pressure jobs can take.”

Employer opinion on CSR

So, as an employer, what can you do to attract and retain the latest generations of talent in your workplace? There are three main areas of focus: environmental CSR, ethical CSR and philanthropic CSR activities. Put simply, you should be asking:

• What is your company doing to reduce its environmental impact? Has it planned any environmental CSR activities?
• What is your company doing to ensure employees and customers are treated fairly?
• What is your company doing to make society better?

How Tusker can help?

1. Improve your CSR standing 

For fleet managers and companies operating car salary sacrifice schemes, this is great news. There are still many organisations that don’t consider the positive impact that providing ultra-low and zero emissions cars for employees can have on their CSR standing. Providing these green cars through a tax efficient salary sacrifice scheme can make a significant contribution to an organisation’s environmental footprint, and thereby to its CSR profile.

2. No unexpected bills 

In these uncertain financial times, salary sacrifice for cars could also reduce anxiety and induce a more positive outlook for many employees – they’ll have a brand-new car, with the confidence of knowing that it’s being provided via their employer and therefore covered if there are any problems – a welcome relief in these times of furloughing and potential long-term effects from Covid-19. As prices rise across the board, the knowledge that a salary sacrifice car comes with tax, insurance, maintenance and even tyre replacement included in the single monthly payment, budgeting becomes easy, as there are no unexpected bills to worry about either.

3. Boost your green credentials 

It’s worth regularly reviewing your employee benefits policy and considering initiating positive environmental policies such as a green fleet, which would boost your CSR green credentials while at the same time, give a much-needed boost to the mental health and finances of employees.

Here at Tusker, 91% of our new car orders in the first half of 2023 were electric or hybrid. We’re market leaders in this area and are happy to talk to you and your business about the benefits of car salary sacrifice schemes, green fleets and the positive impact for employees and your CSR.