Corporate Australia missing the CSR Mark

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Corporate Australia missing the CSR mark

Tuesday 29 November 2011: Despite many businesses investing significantly in Corporate Social Responsibility (CSR), an overwhelming 86 per cent of Australians are not familiar with the term CSR.  When they do know what it means, half (51 per cent) are not prepared to pay for it, an independent study commissioned by global engineering firm MWH has found.

However, when they are informed, most (94 per cent) think it is a good idea and 75 per cent think it should be maintained in good times and bad.

There is a sizeable body of research that shows CSR is good for business. The majority of Australians (74 per cent) have a more positive perception of organisations that report progress against the Global Reporting Initiative (GRI) while the negative impact of not reporting against the GRI is smaller but still substantial (56 per cent).

Commenting on the research MWH Managing Director, Australia, Peter Williams said “Beyond the imperative to be a good corporate citizen, CSR is a strategic investment. What this research is telling us is that when it comes to social responsibility, corporate Australia risks short-changing itself. Corporate responsibility is incredibly important but if you’re going to do it, make sure your constituents are onboard, involved and informed,” he advises.

It comes as no surprise that most Australians are looking for ways to save on household expenditure – to reduce what they spend on power (89 per cent), water (76 per cent), and mobile phone bills (69 per cent). That downward pressure on expenditure means when it comes to CSR customers want to choose if and what they pay for.

Consumers are not convinced they should be paying for CSR as part of the cost of their service. Whilst 75 per cent believe that CSR is an obligatory cost of business, just 21 per cent believe a CSR component should be an obligatory cost passed on to consumers through increased prices. Around one-third (35 per cent) of Australians believe that no customer should pay for CSR through increased prices. A further 44 per cent believe customers should have the choice to whether or not they pay for CSR. 

While many organisations may baulk at the idea, Williams believes companies should consider giving their customers the explicit choice of whether they wish to contribute to its CSR activities. He predicts this would not negatively impact the available funds, only spread the costs across a smaller customer base.

“Companies should consider offering “opting-out” as a legitimate option. In fact, empowering customers to choose could bolster your CSR coffers. The best choice a company can make is to make their CSR efforts discrete, identifiable and transparent.”

Most (64 per cent) Australians would like to have more input in deciding where CSR investments are made, and 62 per cent believe that customers should collectively decide which activities are supported.

“There is a real opportunity for companies to engage their customers by involving them in the CSR conversation. This could be as simple as giving them a shortlist of proposed CSR activities and letting customers vote on what should be the priority”, suggests Williams.

Consumers have definite ideas on what constitutes appropriate CSR investment.  Australians are reluctant to fund employee volunteering (only 19 per cent support this), community sponsorships (24 per cent) and charitable donations (29 per cent).

“The unwillingness of consumers to subsidise these aspects may be because we view them as being the responsibility of individuals, not corporates,” suggests Williams.

The highest-rated investments were within the human rights and environmental categories with the abolition of child and forced labour highest (41 per cent), protection of endangered species (40 per cent) and the protection and restoration of natural habitats (39 per cent).

“There may be an opportunity for organisations to better align their CSR strategy with their customers’ sentiment,” Williams says. “Organisastions can put processes in place to capture what their constituency feels they should focus on, and what activities they should be investing in.”

“But it’s not just customers they should be communicating with,” Williams says. “Internal communications should also be a priority. If you are going to do it, prove it.”

The research found that almost one in five (17 per cent) are in jobs where they know there is a CSR policy, one in three (33 per cent) are in jobs they know do not have a CSR policy and more than half (51 per cent) are unsure as to whether or not their employer has a CSR policy.

ENDS

About the Research

In September 2011 MWH commissioned Lonergan Research to conduct a study of Australian households to establish attitudes toward of Corporate Social Responsibility.

The research was conducted between 27 September and 4 October 2011 of 2,006 Australians, 18 years of age and over, distributed across the country in both capital city and regional areas. The results were weighted to the latest population estimates according to the Australian Bureau of Statistics. Accessibility/Remoteness Index of Australia (ARIA) scores were applied to allow the data to be analysed according to three broad categories of remoteness: cities, regional and remote.

About MWH

MWH has been consistently ranked in the top three companies worldwide as a management, engineering and construction firm, focusing on wet infrastructure.  The wet infrastructure sector encompasses a full range of water-related projects and programs from water supply, treatment and storage, hydropower and dams, water management for the natural resources industry and coastal restoration to renewable power and environmental services. MWH is a private, employee-owned firm with offices in 36 countries across the Americas, Europe, Middle East, India, Asia and the Pacific Rim. For more information visit the website at www.mwhglobal.com.