Corporate Social Responsibility: in a relevant way

"Operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business. Social Responsibility is a guiding principle for every decision made and in every area of a business.”

Such is the definition of Corporate Social Responsibility, or CSR. In the past few years, CSR has found itself propelled to the top of many corporate agendas in the light of massive scandals for some (Enron, WorldCom) and increasingly negative reputations for others (Wal-Mart). The immediate reaction of many companies has been to dump cash into the first “socially responsible” organization around, and then to claim as loudly as possible their generosity.

But for many companies, the main goal of CSR is to bolster the bottom line by improving brand image, in a relevant way. Ford’s commitment to Breast Cancer Research is certainly beneficial, but not necessarily to the company. Breast Cancer research may tell consumers that Ford is giving money to do good in the world, but not the kind of good that is directly related the company. When consumers think of Ford, they think of cars. And except for a few customers, breast cancer research will not be a determining factor next time they look to purchase a brand-new vehicle. This is not to say that Ford shouldn’t support such research. But to truly make an impact on the majority of customers, an additional kind of CSR would have been needed: one directly related to cars. The environment, which seems to be at the forefront of the news nowadays, is the obvious area where Ford could have made inroads with customers.

Obviously it is not enough to brand oneself as “green” to become loved by customers; there must also be a serious commitment that can be seen in the product line. Ford seems to have gotten the message. Its website features a prominent “Good Works” section highlighting Ford’s commitment to environmental protection and communities. But the result is here: Ford’s CSR did not help the company, and certainly did not help its image. Ford suffers from the traditional negative image of American carmakers, and its financial woes seem to make front-page news every few months. In contrast, Toyota has become sole proprietor of the “green carmaker” image, an image that is reflected in sales and market share. Toyota was among the first carmakers to bring green, fuel-efficient vehicles to the market, and because this CSR is so closely tied in to the product line and what the company is all about, it has been successful. Toyota can claim that its fuel-efficient hybrid vehicles are good for the environment and increase revenues at the same time.

The lesson is clear: corporations should be socially responsible. But if they want to impact customers, they need to make CSR a truly integrated part of the company and its everyday business.

Sources: www.ford.com