Corporate Social Responsibility 101: How to get it right from strategy to execution

At CKP, CSR (Corporate Social Responsibility) is more than an on-trend marketing acronym—it’s an essential part of business operations and identity that’s driven by purpose, passion and a desire to do the right thing. It’s an important strand of our company’s DNA just as it’s a critical service we provide to brands, partners and clients. We counsel on strategy, implementation and measurement as a way to strengthen relationships with internal and external stakeholders and the public, offering more authentic storytelling opportunities to foster genuine empathic connections across the board.

We sat down with Maggie Kohn, a member of the CKP Extended Bench team, to explore how CSR has evolved, why it’s essential and lessons learned from counseling on this important business differentiator.

Why is establishing CSR more important now than ever before?

It’s cliché, but having CSR or CR (Corporate Responsibility) or purpose-led strategy is no longer a nice to have, but a must have. Companies that do not simply won’t be around in the next decade. They won’t be around because they won’t anticipate the magnitude of, or appropriately plan for, Environmental, Social and Corporate Governance (ESG) impacts on their business—be it risk such as climate change or opportunities through product innovation.

However, their competitors likely will. These companies won’t be around because younger generations of employees, who we know from research want to work for a company that shares their values, will seek employment elsewhere. Consumers will also vote with their wallets, purchasing from companies that put people and planet first. Finally, investors increasingly are factoring ESG-related risks and opportunities into their investment decisions. Those companies that they feel are not managing ESG well will be taken out of portfolios and indexes.

We are already seeing this happening. Corporate responsibility is now clearly part of good governance, good risk management, and good strategic planning. It’s a business imperative—end of story.

How has corporate responsibility evolved in the last decade? What are some observable trends?

The biggest trend I see is the shift to integrate CR into the business, away from simply a stand-alone function or community relations exercise. For a while, we only had a few examples of this, and we all know them: The Body Shop, Patagonia and more recently, Unilever.

But now, we see more and more companies that are using CR as a driver of their corporate strategies. Take Nike, which recently moved its sustainability function into its Innovation Department, which helps develop new products. And Mastercard, which recently appointed a Chief Sustainability Officer reporting into its President of Strategic Growth.

Another trend is corporate leaders getting involved more than ever on the policy front on issues that either threaten their business or are aligned to its values in some way such as climate change, gun control, abortion and immigration—something we did not see 10 or even five years ago. Just look at the ground swell of CEOs who have pushed the U.S. government— in vain—to stay in the Paris Agreement.

What are three large brands that are doing corporate social responsibility right? Why do you think so

Unilever, Novartis and MasterCard.

For each company, senior leadership embraces CR in its truest sense and speaks about it as part—not separate from—their overall corporate strategy both internally and externally. They each have successfully integrated CR into their business strategy in ways that have created business and social value.

Novartis, for example, has established a new innovative business model they call Social Business to sell its products commercially in low-and middle-income markets such as Kenya and Ethiopia. MasterCard has combined both commercial and philanthropic strategies to expand financial inclusion for millions around the world who lack access to basic financial services. These organizations are also transparent—they measure and share their progress and are candid when they come short in meeting a target. Finally, these companies have embraced a long-term view, with Unilever perhaps being the best example by no longer issuing quarterly earnings reports.

If a brand or business doesn’t have a CSR program, how should they get started?

Research and listening.

First take a look at what leaders in your sector are doing by reading their CR reports and seeing what their management is saying. Next gather input from a wide array of stakeholders—employees, investors, customers, NGOs, government and regulatory officials—to find out what ESG priorities they believe are important for the company to address. Also find out where your company stands on ESG rankings and ratings to understand where improvement is needed, either in actual performance or disclosure. This will help create a general foundation on which companies can begin to build a strategy around a few select ESG priorities that includes quantitative goals and metrics and a road map for progress.

Finally, it is critical that that senior leadership all the way up to the board signs off on the strategy, goals and metrics, and that management is updated on progress on a consistent basis.

What are common pitfalls businesses should avoid?

Focusing on a one-off cause marketing initiative that looks good but isn’t truly sustainable or embedded into the fabric of the organization should be avoided at all costs. Companies should also avoid the trap of viewing CSR as simply a reputation-enhancing exercise and instead seize the potential to leverage it as a strategic tool with the potential to mitigate risks and create value for the organization.

Also make sure you don’t pursue priorities externally before ensuring you have your internal ducks in a row. For example don’t set yourself up as a champion of women’s empowerment when you have not yet committed to gender pay equity internally.

How can one measure the efficacy of a corporate social responsibility program?

It’s all about setting up the right metrics at the beginning of the project. This is so critical in order to see mid-initiative if the project is going in the right direction and if changes need to be made to set it back on course. Metrics should strive to measure the key outcomes the project is intended to achieve—not just core inputs like dollars invested or products donated.

This is a difficult task but there are some companies that are making progress such as Novartis, which is working with Boston University to measure the outcomes of its Social Business activities. It’s important to also establish metrics that measure the impact on the business itself. This is important to gain credibility with senior leadership and defend your project when budgets are on the chopping block.

As a member of CKP’s extended bench, what’s your approach to counseling brands on corporate responsibility initiatives?

Initiatives must be authentic to what the company or brand is. If it’s not, people will see right through it as a public relations or marketing gimmick. It also should be related to the company’s core business—even if it is a purely philanthropic initiative. For example, the Jet Blue Foundation invests in STEM (Science, Technology, Engineering and Mathematics) and aviation education. While this isn’t designed to get more people to fly Jet Blue, it does support the company’s goal of increasing the size and the diversity of the pilot pipeline—a critical business issue for the sector in general.

Ultimately, initiatives that are viewed as most credible and are sustainable over the long-term are embedded into the business—whether that’s a materials company developing a new portfolio of bio-based plastics, or a food company teaching small hold farmers sustainable farming practices that will increase the quality and yield of their crops.

About Maggie Kohn:

A member of CKP’s Extended Bench, Maggie Kohn is passionate about helping organizations achieve positive change in the world by managing and maximizing their economic, environmental and social impacts. In addition to strategy development, Maggie helps organizations communicate their impacts and efforts to key constituencies to strengthen their influence and reputation. She worked for more than 20 years at the biopharma company Merck & Co., Inc., leading communications, corporate responsibility and social business initiatives. She was pivotal in the development of the company’s award-winning corporate responsibility reporting strategy, as well as its global Access to Health principles that defined Merck’s access vision and priorities. Within the company’s commercial operations team, Maggie built a sustainable business for a life-saving women’s health product in low- and middle-income markets by forging strong partnerships with global, national and local stakeholders – including the Bill & Melinda Gates Foundation, UNFPA, USAID and the Clinton Health Access Initiative. In 2018, Maggie founded Maggie Kohn Consulting where she provides services in corporate responsibility, communications and social impact. She currently writes, speaks and consults when she is not busy fostering kittens for her local animal shelter. She is a graduate of the Medill School of Journalism at Northwestern University and resides outside of New York City.