Increasingly, companies and brands are finding that in the minds of their customers, employees, communities and investors, simply “doing good” is no longer good enough. Today, more and more businesses are embracing the philosophy of “business for good is good for business.”
Why is this happening? In most cases, it’s because altruistic and pragmatic interests have aligned. Take, for example, the issue of clean water. We all know clean water is important, and no one would argue that we want to make sure there is an abundance of clean water for our children and grandchildren. But think about it from the perspective of a global consumer goods corporation that sells personal care products like shampoo, soap and laundry detergent. They need clean water to be able to make their products, and consumers need access to clean water to be able to use their products. Working to ensure clean water is available across the globe for generations to come is not just a good thing to do, it’s a business imperative.
The shift also is due in large part to stakeholder demand; people expect the organizations they work for and do business with to act as change agents – to stand up, speak out and make a difference for the greater good.
It’s no secret that today’s stakeholders have access to more information than ever before, and they are watching closely to make sure you walk the talk. There’s a demand for transparency and they want to know what you’re doing to drive positive social impact – including your goals, commitments and progress. For many organizations, this is propelling an evolution, challenging them to reimagine their approach and their overall corporate strategy, moving from corporate social responsibility (CSR), an approach that believes in doing well by doing good, to environmental social governance (ESG), a systemic application of environmental, social and governance disciplines within a business.
The World Economic Forum identified three key trends that are happening as a part of this evolution, all of which have major implications for communicators:
- From message to meaning – Storytelling will always be important, but now, stories must be supported with data. It’s one thing to say you are committed to increasing diversity within your senior leadership team, but are you setting measurable goals and reporting on your progress year over year? That’s what people want to see. And remember, it’s progress over perfection. Don’t shy away from or gloss over goals that haven’t been met. Instead, report the facts, including where you’ve excelled and where you have opportunities to improve.
- From silos to systems – ESG issues cannot be addressed in a silo. Think about a topic like diversity, equity and inclusion (DEI). DEI is not something a committee tackles; it’s a strategic business imperative that’s embedded into the ecosystem of your organization and your culture.
- From cost savings to value creation – ESG initiatives are not created to drive down costs; instead, ESG is about creating opportunity and growth by operationalizing corporate purpose. The first step is clearly defining your organization’s purpose and making sure it’s understood and embraced from the top-down and bottom-up.
Why purpose? Because purpose matters. Many studies have shown that alignment between personal and corporate purpose is the number one driver of employee engagement. Other stats show that purpose-driven companies have less employee turnover, more revenue and higher market value. Consumers are more likely to trust, purchase from and recommend brands with a strongly articulated purpose. And when a crisis hits, they are more forgiving of those brands in a challenging moment.
Now, more than ever, your social impact strategy plays a critical role in driving employee engagement and protecting brand reputation.
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This article originally appeared in partnership with PR Daily.