Corporate Social ResponsibilityIs it important? What’s the impact?

Corporate Social ResponsibilityIs it important? What’s the impact?

Presented by:Charlotte Hines

‘The Triple Bottom Line’Communications Directors Forum

15 June 2001

Images in Perspective

Attitudes to Large Companies

Industries

Companies

Detailsof ImageProfile

Source: MORI

A Tentative Model of Corporate Reputation

Overall Corp. Rep.

Financial stability/profitability

Management

Products &services

Customersatisfaction

Social/environmentalresponsibility

Treatment ofstaff

Source: MORI

But the future seems to be. .

Overall Corp. Rep.

Responsible BusinessPolicy, Practice & Behaviour

=

Source: MORI

The Components of Corporate Responsibility

Environment

EthicalConsumerism

Social Reporting Treatment

of customers

SociallyResponsibleInvestment

Cause RelatedMarketing

Treatment ofemployees

CommunityInvolvement

TRUSTWORTHYCORPORATE

CITIZEN

Environment

Source: MORI

4%

4%

5%

7%

11%

17%

20%

What do the public think CSR is?Q Could you tell me, in your own words what you think is meant by the term

corporate social responsibility?

Base: 2,099 GB adults, October 2000

Responsibility towards customers

Responsibility towards local community

Responsibility towards the environment

Acting responsibility/ethically

Responsibility towards employees

Being profitable/successful

Responsibility towards theirshareholders

Source: MORI

It’s not just policies. . .

Recognition that companies must make a profit. . . but not at expense of good employee and customer practices

BusinessPractices

InvestmentPolicies

“Walk the Talk”&

Set an Example

Exclude negative behaviours&

Support positive behavioursSource: MORI

Companies’ reputations and their licence to operatearound the world depends on meeting these widerresponsibilities while competing effectively

And Government Recognition. . .1999: ‘A New Vision for Business’

October 2000: SDC set up, reporting to Government

February 2000: First new CSR Minister in Britain

Source: MORI

Stakeholders’ Expectations

Criteria for Judging CompaniesQ What are the most important factors you take into account when making a

judgement about a company?

Treatment of staff

Quality of management

Financial performance

Quality of products/services

Customer service

Environmentalresponsibility

GeneralPublic

%

21

12

15

25

20

4

2Social responsibility

BusinessPress

%

38

56

21

9

12

CityInvestors

33

90

66%

16

11

11

88

94

94

MPsLab%

53

38

25

33

70

Con%

33

32

53

14

1934

40 17

56

Base: 1999/2000 Source: MORI

Changing PrioritiesQ What are the most important factors you take into account

when making a judgement about a company?

18%

43%

MPs 1995Financial performance

Environmental responsibility

34%

24%

MPs 2000Financial performance

Environmental responsibility

Source: MORI

67%

50%

63%66%

80% 80%

Q. How important, if at all, are each of the following in helping youto assess a company?

% saying fairly or very important

Influences on Company Assessment

Base: All respondents (93 analysts, 50 investors, 30 journalists, 30 IRMs)

34% 33%

53%

38% 40%

54%

Social Policy Environ. Policy Integrated Vision

AnalystsInvestors

JournalistsIRMs

Source: MORI

. . And now more importantQ “Companies’ social and ethical performance are more important to

me now, given the forthcoming changes to pension fund disclosure”?

56%37%

7%

Base: Investors (104), June 2000

InvestorsDon’t know

AgreeDisagree

Source: MORI

34%

40%

56%

A Global Agenda

Base: 25,000 adults in 23 countries, May 1999

Responsibility (employeetreatment, communitycommitment, ethics,environment)

Q What are the things that matter most to you in forming animpression of a particular company?

Product/brandquality

Business/financialperformance

Source: MORI

41%

28%

44%

49%

The Importance of Social ResponsibilityQ When forming a decision about a product or service from

a particular company or organisation, how important is itto you that it shows a high degree of socialresponsibility?

Fairly importantVery Important

Base: British adults (c. 1,000)

1998

2000

Source: MORI

11%

40%

22%

4%

22%

Consumers feel empowered

Neither/no opinion Strongly agree

Base: 1,970 GB adults, May 2000

Q How strongly do you agree with this statement: ‘as a consumer I canmake a difference to how responsibly a company behaves’?

Tend to agree

Strongly disagree

Tend to disagree

Source: MORI

The Five Clusters

‘Look after my own’‘Look after my own’22%22%

‘Brand Generation’6%

‘Global Watchdogs’‘Global Watchdogs’5%5%

‘Do what I can’49%

‘Conscientious ‘Conscientious Consumers’Consumers’

18%18%

Source: MORI/ The Co-operative Bank - October 2000.

39%

36%

12%

6%7%

Social Responsible Investment

No opinion

A great deal

Base: 1,000 GB adults. 8-13 June 2000

Q To what extent would you like to see the trustees of your scheme usetheir voting rights to put pressure on the companies in which theyinvest, to improve their social, environmental or ethical performance?

A fair amount

Not at all

A little

Source: MORI

SME Expectations Over 5 Years

6%5%

5%

46%

38%

Neither/no opinionStrongly agree

Base: All SME’s (2000) Jan-Feb 2000

“Social responsibility will become increasingly importantto businesses such as mine, over the next five years”

Tend to agree

Strongly disagreeTend to disagree

Source: MORI

How can we encourage SMEs?■ Currently, SMEs:

– support the case for involvement– understand the business and social impact– need further assistance to aid involvement

■ Future involvement can be encouraged by:– Promotion of benefits to their business– Assistance in developing cost-effective approaches– Establish a kitemark or symbol– Promote CSR vs CCI– Demonstrate how to get involved

Source: MORI research conducted for BiTC Impact on Society taskforce, conducted among 200 MDs of SMEs in Britain - February 2000

"Industry and commerce do not pay enough attention to their socialresponsibilities"

Base: 1999/2000

70% 7%General Public

80% 6%CSR Activists

DisagreeAgree

8% 70%Conservative MPs

79% 7%Labour MPs

41% 15%Business Journalists

36% 33%Investors

37% 40%Analysts

Q

Business not perceived to be doing enough

Source: MORI

Impact of CSR on Reputation

Base: General Public (960), Jan-Feb 1998

Drivers of Favourability

73%Awareness of specific initatives

44%

42%

38%

39%

47%

37%

48%

43%All General Public

Full-time workersNot workingMenWomen

Lived in area less than 5 years

5-10 years

10+ years

Source: MORI

Impact on Employees

40%

10%

51%

15%

60%

22%

Q Which of the following statements comes closest to youropinion of your company as an employer?

I would speak highly of them without being asked

I would speak highly of them if asked

23%19%

13%I would be critical of them (spontaneous andprompted)

Involved Aware/not involved Not aware

Base: Involved (781), Aware/not involved (1,036), Not aware (392). March-May 2000

Source: MORI

Impact willdepend onalignment

withexpectations

Source: MORI

Reputation Dimensions! Question 1

– How important is CSR (& each element) against otherfactors?

! Question 2– How is your company rated on each criteria?

! Question 3– How does this compare with competitors in each

country?

! Question 4– How do perceptions match expectations?

Source: MORI

Perceptions vs. Expectations of Key Issues

-1.15

-0.75

-0.35

0.05

0.45

0.85

1.25

2.6 2.8 3.0 3.2 3.4 3.6Importance

Perceived CompanyPerformance

High importance,

Low performance

High importance,

High performance

Low importance,

High performance

Low importance,

Low performance

CRITICAL IMPROVEMENT AREAS

Source: MORI

Perceived Priorities

European Priorities for companies

Base: All ‘European’ public (12,162) across 11 countries.Source: MORI/CSR Europe September 2000

Q Looking at this card, please could you tell me which areas you feelare important that companies contribute to or support?

Ensuring operations respect human rightsProviding secure jobs to employees

Protecting in health and safety of its workers 77%72%

70%

Helping solve social problems

Ensuring products don’t harm environment

Supporting charities and community projects

Investing in education and training

Treating all employees fairly

Ensuring no participation in bribery

Listening/ responding to public

Social responsible investment

68%68%

59%58%

49%43%

41%41%

3%

37%40%41%

45%45%45%47%49%49%

53%56%

59%62%

British public priorities for companies

Base: 2,077 GB adults 15+. Source: MORI Annual CSR Study, 2000

Education

Q Which areas do you feel it is extremely important that largecompanies contribute to or support?

Protecting the environmentHelp people with disabilitiesRecyclingCrime prevention

Unemployment schemesHelp for the elderly

Protection of the countryside

Research for incurable diseasesRegeneration

Job creation

Road safety/safe drivingWork experience/placements

BUT:Priorities differby industry

Local, National or International Support

Base: GB adults

010203040506070

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Local National International

Q Which types of company involvement in society and the communitydo you most like to see: support of local based projects, national (ieBritish) projects, or international projects?

64%

25%

8%

Source: MORI

6%8%

66%

20%

Business should talk

Companies shouldmake an effort totell us but shouldnot spendsignificantamounts

Q Which of these statements best describes your view of the balancebetween programmes and communications?

It’s important to knowabout companies’programmes, they shouldspend significant amountsto tell us

Not important to know, nomoney should be spent oncommunications

Base: 1,046 GB adults aged 15+, July 2000

Don’t know

86% want to know about companies

activities

Source: MORI

Communication

■ All MORI research in this area shows that:

■ Awareness of responsible practices & involvement is low

■ People expect to know - especially employees & shareholders

Perceptions Reality

Inform & Communicate

What Makes Outstanding Press Relations?Q In your opinion, what makes for outstanding press relations?

Top answersAvailability ofmanagement

23%

33%

35%

35%

45%

48%

48%

Base: All Business & Financial Journalists (31), Winter 1999

Speedy responsesOpenness

Availability/accessibilityUnderstanding of individualpress requirementsHonestyKnowledge ofcompany/market

Source: MORI

Mostuseful

69%

72%

72%

72%

88%

6%

3%

3%

31%

16%

Single mostuseful

0%

0%

Sources of InformationQ Which of these sources of information are most useful to you in your work?Q Which of them would you rate as the single most useful?

Telephone conversations(company officials)Personal interviewsNews agencies (e.g. Reuters)

Press releases

Websites

Public relations agencies

Company PROs 63%

69%

Base: All Business & Financial Journalists (32), Summer 2000Source: MORI

63%

20%

28%

32%45%

63%

54%

45%

Current Quality of Company Information

Base: All respondents (93 analysts, 50 investors, 30 journalists, 30 IRMs)

Analysts

Poor

InstitutionalInvestors

BusinessJournalists

Investor RelationsManagers

Good

Q How would you rate the quality of information provided by companieson environmental, social and sustainability performance?

Source: MORI

IRMsLack of established environmental

performance indicatorsPoor internal social reporting

systems in companiesUncertainty on social issues

Barriers to Quality Information ProvisionQ. Which, if any, of the following factors do you consider as serious barriers tothe provision of high quality information on environmental & socialperformance? Prompted. Top answers

AnalystsLack of established environmental

performance indicatorsLack of established social

performance indicators

InvestorsLack of established environmental

performance indicatorsAttitude of investors

Uncertainty on environ. issues

JournalistsAttitude of investors

Lack of established environmentalperformance indicators

Source: MORI

Social Reporting - What do stakeholders want?■ Clear overview of policies

Ethical, Environmental & Social

■ How that translates into practices Countries & Stakeholders

■ Honesty & openness What has/ hasn’t been achieved?

■ Measurement & benchmarks

■ Case studies showing impact (not just investment)

■ Executive SummarySource: MORI

Conclusions

Implications

■ Corporate Social Responsibility and Sustainable developmentare the umbrellas of ethical behaviour

■ Being 'socially responsible' and getting involved matters to allstakeholders

■ . . it impacts on corporate reputation and the bottom line

■ And if you incorporate CSR into mainstream businesspractice - it is your corporate reputation

■ Communicate - it does affect their opinion of your company

Source: MORI

Crucial for future success. . .

Pot of Goodwill

Source: MORI

THANK YOU