Small Businesses Can Get Value From CSR Too
3rd September 2015 | By Grainne |
This article from the Huffington Post talking about how the business case for CSR applies to smaller companies as well as large ones resonated with me. Since I started this business twelve years ago it’s been an ongoing source of frustration to me that we get business almost exclusively from large organisations.I’m not complaining by the way – very happy to work with all our clients – but I know that we can help add value to small businesses and would like more opportunity to do so. It frustrates me that small and medium enterprises (SMEs) are missing out on the opportunity to gain from well-structured CSR programmes and that they are missing out on adding value in their communities. This is particularly important in the Irish economy with so many small and medium size businesses. According to this article from the Irish Times SMEs account for 99.7% of all companies in Ireland. So let’s debunk some of the myths associated with CSR that put smaller businesses off bothering.
“CSR is only for big companies with big budgets”
There is no doubt that smaller companies are working with smaller pots of money but that’s no bad thing. Limited resources often mean that people have to be pickier and cleverer about their choices. Not having money to waste makes us more selective. Being selective and strategic is key to well-implemented CSR programmes. CSR programmes are not about throwing money at problems, they are about finding ways to alleviate or solve issues that impact both society and your business. For some it’s a case of putting their skills to work on an issue (and developing employees at the same time), for others it’s about working on a social issue that is hindering their ability to grow the business. Whatever it is, it’s unique to your particular business situation. When well thought out, a CSR programme should be delivering value to your business as well as the community so should be of low cost, no cost, or even minus cost because it is enabling greater profits for the business.
“I already give to charity”
CSR programmes are not just about charity. I’m not for one second advocating that you stop giving to favoured charities but it’s unlikely that your donation is doing much for your business. A CSR programme should provide benefit to your business and the community. Charitable donations don’t yield much anymore in PR terms and reputation enhancement. The days of getting any news coverage for your donation to a local charity are pretty much gone. A lot of small business owners feel a bit embarrassed about publicising their charitable donations anyway. It goes against what most of us were taught as children. The nuns at school certainly told us that the left hand shouldn’t know what the right hand is doing which completely bemused me at the time (I was only seven) and had to be explained to me by my dad. Charitable donations tend to have only a short-term effect on staff morale. It gives your employees a lift the first time you do it but quickly becomes business as usual. A CSR programme that is clearly connected to your business strategy or activity is more likely to be newsworthy and enhance your reputation. If it’s clearly connected to your business it makes sense to your customers and local community which in turn makes your business more memorable. If it’s connected in this way you don’t have any reason to be embarrassed about the publicity. It also has longevity and creates continued interest for your employees giving them more reason to feel pride in their work. As your workplace fills with millennials (those born between 1982 and 1999) this becomes even more important as there are several bucket loads of research telling us the value this generation places on work with purpose and feeling pride in what they do and who they work for.
“I already donate to my local school/community centre/sports club”
There is no doubt that donations and sponsorship can make a big difference to small local organisations which in turn are important to the community. It’s often just about giving money and getting some publicity in return so arguably is more about advertising rather than making a unique contribution to a specific issue that is well aligned with your business activity. One well-known expert* in CSR talks about firms picking issues for which they own part of the solution. This may sound grandiose and only for the big names. But being a small business doesn’t prevent you from owning solutions to problems in your own local area or particular area of expertise. In fact I suggest that if you are in business at all it’s because you have solutions that people need or want. So the next step is to align your business purpose with a problem that needs to be solved.
“I’m well known in my community so I don’t need to enhance my reputation further”
It’s easier to be a big fish in a small pond and many businesses rely on local knowledge and word of mouth referral. Most of us would be happy to get referral business in this way (I’m certainly delighted that we often do) and as customers we often like to use someone local who has been recommended. Business owners cannot afford to be complacent though as the environment is changing so fast with online business and the sharing economy disrupting many business models. A strategic CSR programme that resonates with customers, employees and others in your local community can help protect your reputation and competitive advantage. Going through the process of developing a unique CSR programme also helps you identify risks to your business, efficiency improvements and maybe even new business opportunities or streams of revenue. By their nature small business owners are likely to be more committed to their local community and to understand the needs of their local community better than many of the bigger names. This can mean the smaller business is better placed to make a real and lasting difference in their community and more flexible in responding to local issues.
“My workforce is small so I won’t be able to gather enough volunteers to make a difference to any project”
Volunteering is a popular component of many CSR programmes but not a necessity. Volunteering opportunities can be a great way of enhancing staff loyalty and building in development opportunities and informal training for employees. Lots of large companies now give employees paid time off to volunteer as part of their CSR programmes, usually for morale building reasons. Small companies may feel it would be impossible to get any scale of volunteering but sometimes it can actually be easier to develop volunteering in a small business with a smaller team of people who know more about what each other is doing than in a large company where it’s harder to communicate the message. The key thing to work out is whether volunteering is right for your business and should be part of your CSR programme. If it’s right for you we’ll find a way, if it’s not it shouldn’t be part of your CSR programme.
“I can’t afford expensive CSR consultancy and I don’t have in-house expertise”
Few small businesses have any in-house expertise in CSR (unless maybe you are lucky enough to employ one of my MBA students). So often small business owners simply throw some money at local sponsorship or charities which may not be doing much for the business. I promise you we are not expensive. In relation to helping you develop a strategically aligned CSR programme that will be beneficial for your business as well as your local community, well I’d be very surprised if we didn’t actually save you money. We have developed a framework we can take you through to help you make the right decisions and design a CSR programme that’s right for your business. There is no one size fits all in this arena. We’re happy to have a chat about it. Just give us a call or contact us by email.
*McElhaney, Kellie. 2008 Just Good Business Berrett-Koehler