CSR:Profitability, social responsibility and organisational leadership—- Report

With corporate social responsibility initiatives gaining traction, some progressive companies are going beyond volunteerism, linking profitability with social responsibility and embedding these goals in their core mission statements.

When organisations include social responsibility programmes within their leadership development efforts, it results in a positive impact on overall engagement and performance, a report said today.

According to a global study released by the Hay Group division of executive search firm Korn Ferry, across all leadership levels, an average of only 36 per cent of employees are “highly engaged”.

Leveraging a social responsibility agenda to develop leaders can help reverse this trend, it added.

Around 87 per cent of respondents say that linking an organisation’s social responsibility efforts to leadership development has a positive impact on overall engagement and performance, according to the survey, which includes data from more than 7,500 business and HR leaders in 107 countries.

However, only 59 per cent of respondents say their organisations actually link the two.

“If an organisation wants to win the current war for talent and retain valuable employees, then it needs to ensure that they constantly feel inspired. Employees need to view themselves as part of a big picture; and this is where the social responsibility platform can help,” Korn Ferry Hay Group Country Head Nitin Razdan said.

Razdan added that, “some of our own initiatives in India towards ‘nation building’ have helped us connect our employees to a larger purpose.”

With corporate social responsibility initiatives gaining traction, some progressive companies are going beyond volunteerism, linking profitability with social responsibility and embedding these goals in their core mission statements.

“We have been working with clients in India and Asia Pacific on leadership development which has components of social responsibility built in. These programs have delivered very high impact,” Korn Ferry Hay Group Regional Director Gaurav Lahiri said.

A separate Korn Ferry study shows that the top factor that improves people’s feelings about their job is working for a company whose culture aligns with their values.

Moreover, the number one reason millennial choose one job over another is visibility and buy-in to the mission/vision of an organisation.

To this end, majority of companies expect to spend more on social welfare activities in the next financial year as CSR increasingly becomes part of strategic decision making process.

Checks also revealed that, under the law, certain class of profitable entities is required to shell out at least 2 per cent of their three-year average annual net profit towards CSR activities. This law, more often than not, appears to be an uphill task for corporate to cope with in Nigeria.

However, analysts also revealed that companies find lack of clarity on laws and tax-related regulations along with some other factors as obstacles in implementing Corporate Social Responsibility (CSR) projects.

For these analysts, companies are increasingly looking at integrating their businesses with the community to create shared value. They also stated that creation of shared value as a motivation factor, followed by social good compliance will enhance productivity in the area of corporate social responsibility all over the world.

Godwin Anyebe