Sydney, Australia - 3 March 2008: A new global survey by IBM’s Institute for Business Value, shows that corporate social responsibility is now seen as a growth opportunity, rather than a regulatory compliance burden or purely philanthropic effort.
Full details of the survey covering 250 organisations (30 percent of which were in the Asia Pacific region, including Australian organisations) are detailed in a report titled, "Attaining Sustainable Growth Through Corporate Social Responsibility."
According to Matt English, IBM Australia’s Business Strategy & Change Leader: “Companies believe that being more open with stakeholders and placing social responsibility at the core of their business strategy will make them more competitive.
“Having a strong Corporate Social Responsibility (CSR) policy is now seen as a ‘must have’ for organisations seeking to attract and retain the best talent. It’s also viewed as a means to gain access to new business opportunities.”
IBM’s research shows that globally, 68 percent of organisations surveyed focused on generating revenue through CSR activities. In addition, 54 percent believe CSR initiatives contribute to giving their corporations a competitive advantage.
Explaining the driving forces at the heart of this trend, Mr English said: “Customers and social computing that are driving these beliefs. Thanks to their ability to research and share information via the Internet, consumers have become highly sensitised to a broad range of issues.
“Everything from concerns about climate change, to product safety issues, to labour practices, to corporate financial accountability and questions about whether corporations are returning enough of their profits to the community are becoming top of mind with all kinds of consumers.”
Fuelling the customer focus on CSR, three-quarters of businesses report that the number of advocacy groups collecting and reporting information on them has increased in the last three years as has the amount of information businesses are providing about the sourcing, composition and impact of their products, services and operations.
"The more information these stakeholders get, the more they want to know. This increased visibility of corporate behaviour is driving consumers' decisions on what to buy and who to buy from, who to work for, who to partner with, where to invest.
Mr English said it was not only critical for businesses to keep up with the emerging demands of their stakeholders, but to build CSR into the core of their business strategy.
“That way CSR is not viewed as a discretionary cost but an investment that will bring financial returns. And since customers are changing buying behaviour as a result of CSR, the financial impact can be dramatic," he said.
While customers are becoming the chief driver of this increased focus on CSR, 76 percent of businesses surveyed admit they don’t truly understand their customers’ CSR concerns. Even businesses that feel they are knowledgeable and prepared to deal with CSR issues may not be.
“Nearly two-thirds of the companies we surveyed believe they have sufficient information about the sources behind their products and services to satisfy customer concerns, but half of those admit they don't understand their customers CSR expectations at all well.”
The full IBM study, available at www.ibm.com/gbs/csrstudy, evaluates how well companies understand and manage CSR expectations. It also outlines steps along the "value curve" that companies can follow to strategically align their CSR objectives to its core business strategy.
According to the report, maximum benefit from the CSR opportunity takes place when all activities on the value curve -- legal and compliance, strategic philanthropy, values-based self-regulation, efficiency and growth -- become integrated into a cohesive strategy with leadership driven as much from employees, customers and business partners as from the CEO and senior executives.
IBM Survey Methodology
IBM surveyed senior executives and directors of strategy at 250 companies across the banking, chemicals and petroleum, consumer goods, electronics, energy and utilities, retail and automotive industries.
Of the participants, 30 percent are located in North America, 30 percent in Asia Pacific, 20 percent in Western Europe, seven percent in Eastern Europe, six percent in Latin America, and four percent in the Middle East and Africa.
About IBM
For more information about IBM, please visit: www.ibm.com.