Is CSR Finally Getting its Due in the Boardroom?

by Gary Larkin for The Conference Board Blog, February 18th, 2011.

There is an acronym that has finally bubbled up to the boardroom: CSR, as in corporate social responsibility. And one of the reasons it is finally being taken seriously, or getting past the lip service phase, is that companies are discovering there is some real value behind CSR activities.

A recent Director Notes report issued by The Conference Board Governance Center (Investing in CSR to Enhance Customer Value, February 2011) determined that CSR activities have the potential to create several distinct forms of value for customers. The report, co-authored by John Peloza, a professor with Simon Fraser University in Vancouver, Canada, and Jingzhi Shang, a Ph.D. candidate at the school, includes a review of 163 articles about the relationship between CSR activities and financial performance.

Those values include: the efficiency of a product or service, the aesthetic appreciation of consuming a product, the social status a customer acquires from using a product, and the social or environmental benefit a community can derive from the widespread dissemination of the product. The report offers business leaders 10 recommendations to enhance the effectiveness of CSR activities on customer responses, such as:

  • Prioritize product-related activities over philanthropy and business practices.
  • Ensure coherence of the activities included in a CSR portfolio to build a strong and recognizable “CSR brand.”
  • Ensure consistent, long-term commitment to each activity in the CSR portfolio, especially when not product-related.
  • Make adequate use of marketing to enhance the customer value proposition of CSR activities.
  • Tie CSR to functional and utilitarian products.
  • Seek optimal level of CSR investment, and avoid over-investing.

(continue reading… )



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