While today’s consumers are still looking for a bargain when they shop, they expect more than a good price from the companies they do business with. In addition to cost and customer service, consumers want the companies they patronize to reflect values and priorities similar to their own.
That means companies have to embrace a measure of what is known as corporate social responsibility in order to compete in the marketplace.
According to a 2018 study by Cone/Porter Novelli, price and quality are no longer enough to attract and keep consumers.
“Today mainstream consumers expect companies to have a more meaningful reason for being, beyond the products they create,” the report said.
Calling corporate social responsibility (CSR) “more than just a trend, it’s the new norm,” the study found companies that adopt strategies to address social concerns “can create deeper emotional bonds with consumers.”
In addition to national companies such as Patagonia, Unilever and Marks & Spencer, some Flagler County firms have adopted CSR as part of their business plan. John Tichenor, associate professor and chair of the Management Department at Stetson University, cites The Golden Lion Café as an excellent example, noting that the Cafe owners donate 50% of the profit from the sale of their famous bottled cocktail sauces to local charities.
Tichenor said CSR is not just for the big national firms but for small-business owners as well.
“Taking a long view, it is easier for some companies than others and it’s easier for some industries than others,” he said. “That is why all companies regardless of size should be thinking about it and thinking how they can add this into their mission.”
Tichenor said it is important for companies embarking on a policy of corporate social responsibility to fully embrace the challenge of thinking beyond the bottom line and making CSR a holistic part of the corporate culture.
“It is more than so-called ‘greenwashing,’” he said, referring to the practice of making an unsubstantiated or misleading claim about the environmental benefits of a product, service, technology or company practice which can make a company appear to be more environmentally friendly than it really is. “That is going to backfire and it has backfired.”
According to Tichenor, to create a viable and substantial policy of corporate social responsibility requires an understanding of a company’s stakeholders – from ownership, officer, investors, consumers and the larger community.
“You can’t meet all the stakeholders’ needs so a lot of it is about balancing and prioritizing stakeholders’ needs,” he said. “And some of it does cost money.”
Tichenor said there are a variety of ways companies large and small can adopt corporate socially responsible practices from investing in new energy sources to focusing on the issues important to stakeholders.
“I think it starts by identifying and understanding those issues and recognizing that it is not just the public relations but recognizing who your stakeholders are. That is where I would recommend any company start.”
For companies considering adopting a corporate social responsibility focus, Tichenor offered three recommendations.
The first is to clearly identify the company’s vision, mission, strategic plan and primary/secondary stakeholders.
The second is to take advantage of any of several business impact tools available online and audit the company’s practices to gauge where the firm stands before moving forward with a corporate social responsibility plan.
And finally, Tichenor suggests taking it one step at a time.
“Know that it is an iterative process,” he said. “Start small, do what you can do now and don’t wait until tomorrow. It’s about the long term, not the short-term gains.”
The importance of looking beyond profit is borne out by the findings of the Cone/Porter Novelli study, which found that nearly 80 percent of Americans believe it is no longer acceptable for companies to simply make money.
For Tichenor, it comes down to a basic change in the attitudes of consumers about where and how they spend their money.
“I think consumers are becoming more and more aware and expecting companies to do the right thing,” he said. “That is a very important aspect and companies need to be aware of that.”