Dr. Daniel Korschun, an assistant professor of marketing at Drexel LeBow, discussed “Positive Returns: How Performance Cultures are Putting the Principles of Corporate Social Responsibility to Work” during a roundtable summit at the CFO Alliance’s Philadelphia Chapter on May 8. Korschun is a fellow at Drexel LeBow’s Center for Corporate Reputation Management and is the co-author of Leveraging Corporate Responsibility: The Stakeholder Route to Business and Social Value.
Korschun framed the corporate social responsibility (CSR) discussion by defining the two routes most companies travel to generate value from CSR: the direct route and the stakeholder route. According to Korschun, the direct route focuses on initiatives that generate value by increasing efficiency and reducing costs. The stakeholder route focuses on leveraging CSR to provide value to key stakeholders who in turn are incentivized to act in ways that can benefit the company. CSR can increase customer satisfaction — which increases market value, Korschun said. CSR can also increase employee self-esteem and work-home integration — which can increase employee retention, productivity and purchases of their company’s product and services.
Korschun’s research shows that when CSR confers a sense of unity with customers, it helps employees focus more closely on customer service.
During the discussion, attendees discussed their current CSR programs and the stakeholder behaviors they would most like to influence. One company in attendance has successfully pursued the direct route by reducing paper volume and recycling mobile devices. Other companies have taken the stakeholder route by focusing on charitable programs to help increase community awareness. In addition, companies that have taken the stakeholder route have achieved customer and employee benefits by winning regional and state –based awards for workplace desirability. These initiatives directly influence talent acquisition and retention.
Despite successful CSR initiatives, CFO attendees agreed that there is a need to rethink some of their CSR programs to coordinate them better and to more efficiently select where to stem their limited allocated funds for such initiatives.
According to Korschun, many companies have CSR reports and initiatives, but they now need to make the connection between individual programs and business objectives — including employee retention and customer satisfaction.