The "Aha" Moment – Are You a Skeptic of Corporate Social Responsibility in Business Success?
In a previous post, Keysight’s Senior Vice President Corporate Services and CSR Executive Sponsor Hamish Gray discussed the six-step journey Keysight took to evolve our CSR program and to meet emerging trends. I’d like to take a deeper look at the step in our journey that really changed everything! And by “everything,” I mean solidifying the strategic role corporate social responsibility (CSR) plays in business success.
Seeing the Forest through the Trees
The benefit of CSR programs to the planet are obvious: supporting community growth, mitigating impact on the environment, and supporting basic human rights for all people to name a few. The benefits to the company, however, can be lost in the process itself.
Let’s face it, from a company and shareholder perspective, the most critical role of CSR is to ensure related programs meet stakeholder requirements:
- The investment community wants to invest in sustainable companies with minimal risk.
- Customers need suppliers that help them meet their own CSR commitments, strategy and vision.
- Current, and prospective, employees want to work for sustainable and ethical companies.
To support these varied requirements, companies must develop associated programs and logistics that ensure appropriate data collection is in place, manage detailed processes that monitor and measure efforts, respond to various reporting mechanisms, and actively communicate actions and results. In a global company such as Keysight, this often occurs across myriad functions, organization levels and countries. The result is a lot of great work being done in pockets of the company to meet specific requirements, but its collective benefit to the business gets lost in the details.
Corporate citizenship experts often tout the critical role that a sound CSR program plays. As a recent BSR report noted, one way to build appreciation for CSR is to "establish a compelling long-term value creation story that asserts the central role that sustainability plays in business success."¹ I completely agree! But when you are in the throes of meeting stakeholder reporting requirements and measuring key performance indicators (KPIs) on specific program elements, it is easy to miss the proverbial sustainable forest through the trees.
Connecting CSR Program Goals to Company Objectives … Really?
At Keysight, we took the opportunity of our company formation to align our CSR programs directly to our company commitments for revenue growth, profitability and shareholder value. At first there was apprehension, perhaps even a bit of skepticism, that our CSR programs could be directly linked to the core business objectives. But as we considered all our programs collectively, the connection became clear.
Let’s take revenue growth as an example any company can relate to. There are many strategies to meet this objective, but in the CSR space, related strategies include having the right employee skillset to meet demand and enable faster new or adjacent market entry.
First and foremost, the needed skillset for growth must be available to hire in the community. At Keysight, our CSR efforts support future engineer development programs starting in grade school through university students. This provides a baseline of future worker skills. Since Keysight formed in November 2014, the company has engaged roughly 275,000 students and future engineers through various science, technology, engineering and math (STEM) education events and programs.
From there, it is critical to attract and retain the needed talent for growth. At Keysight, we enable this through a broad range of benefits to support employee hiring and retention, including ethical governance policies, philanthropy and volunteerism programs that align with employees’ interests.
Key to new market entries that support growth are solid and consistent ethical governance policies that meet worldwide regulatory and legal requirements. At Keysight, our strict focus in these areas enables us to more quickly enter a new product or region market and to integrate acquisitions because we are not continually having to re-invent the process.
These are only a few examples. At Keysight there are roughly 50 programs tracked as part of CSR. Each is directly linked to one or more business objective. Separately, these efforts may seem to support isolated company commitments, but when considered collectively, they become a solid contributor for meeting near- and long-term business objectives.
The "Aha" Moment Revealed!
As I mentioned earlier, there was a healthy level of skepticism when we started down the path of connecting our CSR program to business objectives. While each of our CSR governance team members own or represent multiple and deep-level CSR programs in their functions, and each participated in this mapping exercise, no one except me had seen the consolidation and rollup across our company. So, I was excited to present the outcome of our due diligence in this area.
I literally heard gasps when our CSR program and business objectives alignment was revealed. It was clear that, while everyone understood their actions in this space supported business commitments, they only saw one piece of the puzzle. When viewing all program contributions holistically and aligned with our companywide objectives, it was a collective “Aha” moment.
Since then, this realization has helped:
- D evelop a clear understanding of where and specifically how individual CSR programs impact business commitments and thus contribute to business success.
- Enable our CSR governance team to more strategically manage the program by considering company impact in the prioritization of new initiatives and emerging trends.
- M ore easily gain alignment on resourcing and organizational support to meet program objectives across the company – functionally and globally.
Again, this is not a new concept. Many leading companies have heeded the advice of industry experts and done this exercise. For those that have not yet, or are new to this space, as a practitioner of this advice I can unequivocally say it is well worth the effort!
Source:
1. "Redefining Sustainable Business," BSR (Aron Cramer, Dunstan Allison-Hope, Alison Taylor, Beth Richmond, and Charlotte Bancilhon), January 18, 2018