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Corporate social responsibility in tough times

"A generous man will prosper; he who refreshes others will himself be refreshed."
Proverbs 11:25

IT is true that even in the best of times when money is being made there are some companies who absolutely refuse to give. They are, as my good friend describes their situation "tight till it squeaks". On the other hand, there are other organizations which have made a name for themselves by their generosity to worthy causes. I am not here speaking of the calculated few who only give for the tax benefit or those who give that perpetually over-sized cheque and never let us forget their single (for some it is an annual donation) act of kindness.

Fortunately in Jamaica there are many companies whose generosity is boundless. They give, for example, to preserve the stability of the surrounding communities that support them. These companies 'get it'. They understand implicitly that without a stable society their businesses will suffer. They are aware of the fact that among the ripple effects will be a shrinking demand for their product and the evaporation of their raison detre. So they dig deeper, even as times get harder. There are companies who are loud gift-givers, trumpeting their generosity for all to see and hear. That's fine, that's just how they do what they do. On the other hand, there are the companies who give quietly and let their impact be felt loudly in the communities within which they operate.
For example, Diageo, Grace Kennedy Ltd, Jamaica Stock Exchange are some of the companies, situated in proximity to inner-city communities and have Corporate Social Responsibility (CSR) programmes that impact on the lives of the many residents who are their neighbors.

Now, a word for those charlatans who muddy the CSR waters with their fictitious 'causes' detracting from genuine needs and creating cynics of those of us who would turn out our pockets to help. Yes, you and I know them: their mysteriously manufactured letter-heads with themselves as sole beneficiaries often stray across executive desks. They are relentless and persistent, until unmasked. But they are a bane to the corporate givers' existence. Fair warning to them: stop it.

So, how are companies managing their corporate social responsibility in these tough times? Indeed, there are some who would ask if a company should ever embrace CSR even as they continually hack away at the small privileges (coffee or tea) that they extend to their employees. Corporate social responsibility or corporate citizenship has been integrated in most progressive business models and basically means that companies take responsibility for how their actions affect society.

CSR activities are usually aligned to an organisation's philosophy, its products, audiences or at the other end of the scale, Board member's 'pet interest'. Sports, the environment, children's issues, domestic violence or health issues such as cancer or HIV are some of the areas to which companies hitch their CSR programmes. CSR programmes are important not only because they most importantly benefit the society in which some of companies make the mega-profits, but because they buttress the effectiveness of a company's communications programmes.
Unfortunately there are still executives and employees who still do not understand the importance of corporate giving. They don't 'get' why it is that it is precisely in times like these when dollars are scarce as hen's teeth, that corporate giving should still remain in the books. Mind you, they do not have the same argument for the perks and other company expenditure that make their cushy lives, cosier.

But says, Harvard Business School's Marketing Professor V Kasturi "Kash" Rangan, "Financial turmoil is not a reason to scale back on CSR programmes-quite the opposite," he says.
Says Rangan: "There is no doubt that corporations are engaging in less philanthropy, but that is not necessarily bad as long as they cut the ineffective ones and consolidate those that are synergistic to their business". He is quoted in HSB Working Knowledge as saying: "Here is where the problem might arise: I believe the tendency is to make across-the-board cuts, without reflecting on the company's business strategy and its relationship to the larger environment. Some companies will end up making very poor decisions that will hamper their ability to leverage their reputations when the recession turns around.
He argues that corporate social responsibility (CSR) initiatives are more necessary than ever and says that when carefully planned and managed, such efforts can strategically tackle important societal issues and at the same time enhance business success, yielding a "double bottom line".And there's no time like the present, he adds. "Effective programmes that serve the community in a compelling way, and that also demonstrate a strong potential to influence the business, must be retained and grown."


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