Some corporate social responsibility (CSR) trends include increased transparency of businesses, local community engagement, employee volunteer programs, investments in renewable energy sources, corporate activism or active engagement in social issues, and financial and practical support for COVID-19 relief efforts. For this year and the coming years, CSR initiatives are expected to have more sustainable finance, acceleration of the energy sources transition, long-term commitments and alliances with local governments and nonprofit partners, a stronger manifestation of inclusion, diversity, and equity, and funds being transferred to support post-Covid social issues and charitable causes.
1. Increased Transparency
- One of the trends in corporate social responsibility is the increased transparency of businesses brought by consumers’ increasing demands for company disclosures. Consumers have been commonly demanding transparency among businesses.
- This trend has been driven by the ever-increasing availability of nearly instantaneous information, in addition to the consumer’s demands. As a result, companies have been sharing more social, governance, and environmental disclosures.
- Consumers who have been dissatisfied with some business dealings and hidden agendas are demanding to know more about company matters that are previously considered as internal issues.
- Workers, not just customers, are involved. For example, Google employees publicly opposed the company’s proposal for a cloud computing contract with the United States Customs and Border Protection.
- With all of these factors in play, greater transparency is a CSR trend that is likely to expand in the coming years.
2. Local Community Engagement
- Another CSR trend is localization or local community engagement. Companies that operate globally have been recognizing the value of local supply chains and local markets. This is motivated not just by a goal to minimize carbon emissions related with transportation or supply chain expenses, but also by a desire to use indigenous ideas and expertise.
- Numerous businesses with philanthropic arms are likewise choosing nonprofit partners who collaborate with local leaders and expertise over bringing in cookie-cutter solutions.
- Corporations committed to CSR have increased their engagement with local communities by contributing to local charities, financing the development of infrastructure such as schools in low-income areas, and getting involved in civic problems affecting the communities in which they operate.
- Bank of the West is one of the companies participating in this trend. According to Bank of the West’s Head of CSR, “creating a sustainable future” entails helping the communities in which the bank operates. That is why, via collaborations with groups like as GRID Alternatives and Grameen America, we strive to empower women entrepreneurs, encourage financial health and wellbeing, and promote climate resilience.
3. Employee Volunteer Programs
- Another emerging trend in CSR is the corporate-sanctioned volunteer events or employee volunteer programs. These programs or events, which take place more during the holidays, allow employees to volunteer and make positive contributions to the community using minimal time commitments.
- Employee volunteer programs don’t just make a positive impact on the corporate social responsibility programs of the company, they are also avenues for the company’s team-building activities.
- These volunteer programs improve the company’s culture and morale. It’s also an opportunity to establish cross-departmental relationships and collaboration by putting together employees from different teams during their volunteer days.
- Silicon Valley companies have been leading in this trend with almost half (46%) having 10 or more volunteer events annually.
- According to a study by the UnitedHealth Group, 81% of employed volunteers who volunteered via their employer felt that volunteering together improves relationships between coworkers.
- Some companies have been personalizing the experience by letting employees choose “which volunteer activity they want to partake in, based on their interests or skill sets.”
- The US-based employees of TransUnion have a ‘Volunteer Time Off’ day that’s dedicated to working with the employee’s charity of choice.
4. Investments in Renewable Energy Sources
- According to Anuvrat Joshi, director of business development at Cleantech Solar in India, leading corporations in India and across the globe have made significant promises to include renewable energy into their power mix, and they are following through. This tendency has accelerated over the last five years, and the consequences are already visible within our client base.
- A number of companies have diversified their CSR funds into solar energy not only because it’s socially responsible but also because of its economical appeal as it is expected to bring good returns in the long run.
- Google, Lego, and Johnson & Johnson are some companies that made substantial investments in alternative and renewable energy sources.
- Orsted, a Danish service provider, is also a company that invested in renewable energy sources. From being coal-intensive, the company developed to renewable energy production. Orsted has invested in offshore wind farms that have resulted in an 83 percent reduction in carbon emissions.
- According to Henrik Poulsen, Orsted’s President and CEO, “The urgency to react to climate change served as the impetus for making environmental sustainability a priority for the company.”
5. Corporate Activism or Active Engagement in Societal Issues
- Corporate CEOs have been “progressively standing up for social issues they personally care about, catalyzing a trend of corporate activism.” Business leaders such as Apple’s Tim Cook, Google’s CEO Sundar Pichai, and Starbucks CEO Howard Schultz, as well as CEOs of mid-sized and small businesses, have been outspoken on critical social problems and are using the power of their enterprises to solve such issues via their operations and investments.
- Sundar Pichai, the CEO of Google, has been a vocal opponent of social injustices such as discrimination.
- Business leaders have been taking more action to verbalize support for various societal issues. This advocacy has been expressed in the forms of volunteerism and philanthropic contributions, open letters, and public statements.
- In the summer of 2020, 21 CEOs have asked state governors to promote community safety by requiring retail shoppers to wear masks.
- Research shows that corporate activism increases employee loyalty, hiring competitiveness, and long-term sales. Also, the Weber Shandwick survey of professionals across the UK, US, Canada, Brazil, Mexico, India, and China shows that 84% of professionals favor “CEOs taking public positions on hotly debated current issues” and 79% said that they will “be more loyal to their organizations if their CEOs took public positions on issues.”
6. Financial and Practical Support for COVID-19 Relief Efforts
- According to the research study of Timothy Manuel and Terri Herron that was published in September 2020, “Businesses have engaged in a wide range of philanthropic CSR actions during the pandemic, likely motivated by both utilitarianism and ontological factors in response to the needs of internal and external stakeholders.”
- In 2020, as some governments made an announcement that any amount donated by companies for the fight against Covid-19 will be counted as CSR, the majority of the companies donated to various purposes that are geared towards health protection and hunger prevention of those who were severely affected by the pandemic.
- The research report of the Indian Institute of Corporate Affairs indicates that companies all over the world have been supporting daily wage workers as well as the front liners such as doctors, nurses, and police officers among others.
- Agnico Eagle Mines Limited, a Canadian mining company, has provided over “1,200 N95 masks to local healthcare centers” in response to the calls for help from the government. Whisky makers have produced hand sanitizers while luxury hotels have offered to become quarantine centers.
- Large corporations have been assisting small businesses that are struggling due to the pandemic. Amazon donated $5 million to a relief fund for small companies in the area of its offices, while Google pledged $1 million to groups affected by the epidemic in Mountain View, California.
- The senior leaders of companies, in their own way, have also been giving financial and practical support in response to the crisis brought about by the COVID-19 pandemic. Alibaba’s founder Jack Ma has donated medical supplies and coronavirus test kits to a number of countries through the Alibaba Foundation and Jack Ma Foundation. Jack Dorsey, Twitter’s founder, pledged to donate $1 billion that will be directed at efforts to tackle the existing pandemic. Bill Gates has also been a tireless advocate for international collaboration on this issue.
7. Investments in Green Technology
- One of the CSR trends in 2020 is company investments in green technology. Socially responsible companies have been investing in green technologies to reduce their dependence on non-renewable resources and to look for more sustainable inputs for the business. This is driven by the rapid depletion of natural resources and by the increase in the world’s average temperature.
- Some of the companies participating in this trend are fashion companies that are in search of alternative fabrics such as recycled water bottles or eucalyptus, companies that produce clean emissions through the improvement of machinery emission tests, and companies that simply get certifications such as LEED for their buildings.
8. Diversity and Inclusion
- According to Investopedia, corporate social responsibility involves recognizing wage disparities and economic pressures on workers as a growing trend. Pay equality for men and women, calculating the income disparity between the highest- and lowest-paid employees at a business, and ensuring a diverse workforce have all become top objectives for the world’s greatest corporations.
1. Sustainable finance is the next frontier
- Bank of the West, together with its parent company BNP Paribas, has been leading a new movement in the field of financial services. Sustainable finance, according to the firm, is the next frontier.
- According to Melissa Fifield, Head of CSR and Sustainability at Bank of the West, she observed an organization dedicated to sustainable financing and an unusual degree of openness about the rules that govern what the bank finances and what it does not fund. That is a large part of what drew her to her new job as the bank’s Head of Corporate Social Responsibility and Sustainability.
- This trend is shaped by a desire to stymie the flow of money to companies that damage the environment. Fifield said that their money has an effect on the environment even when we believe it is just sitting in the bank. How? Approximately 90% of consumer deposits are returned to the world to fund new businesses. Whether that new venture is Arctic drilling or solar panels is determined by the bank with whom you bank.
- According to environmental campaigner Bill McKibben, in his essay published in The New Yorker in 2019, money is the oxygen that fuels the fire of global warming.
2. Acceleration of the energy sources transition
- According to Bank of the West’s Head of CSR and Sustainability, experts believe that the only feasible path ahead for mankind is to shift to a renewable energy infrastructure and gradually phase out fossil fuels. We have already committed $1 billion to this transformation; further steps include developing mechanisms for assessing standards and monitoring outcomes while fostering innovation.
- Courtney Hadden, Business Sustainability Head at Akamai Technologies, anticipates an emphasis on corporate involvement with a healthy world when they assume a new Presidency and re-enter the Paris Climate Agreement. Across stakeholder groups, we see an increased and deeper commitment to sustainability on the part of financial organizations like Blackrock, businesses like Microsoft inside their supply chain, and even millennial workers.
3. Long-term commitments and alliances with local governments and nonprofit partners
- The housing affordability problem, coupled with the intolerable disparity in property ownership among minority families, would need innovative collaborations between local governments and the commercial and social sectors. A year of ‘having to remain at home’ for those with assets will focus attention on those who lack a secure, cheap place to live. Consumers and top talent will increasingly prefer to do business with and work for businesses that invest in their communities and live their beliefs.
- In 2020, marketplace events have refocused public attention on problems of economic injustice and racial inequality. As a consequence, businesses are rethinking their social impact strategies and forming partnerships with charity partners that can provide both immediate, mission-critical assistance and long-term transformative change.
- When combined with anticipated changes in consumer behavior and buying patterns in 2020, we expect a greater emphasis on real, multi-dimensional, completely branded relationships that are more integrated than short-term cause activations. In 2021, anticipate long-term commitments accompanied by multifaceted engagement tactics aimed at both consumers and employees.
- 2021 will be the year when the private sector begins to delve deeply into the SDG effects and goals via collaborative efforts. If 2020 teaches us anything, it is how interconnected we really are. From civil upheaval to surviving a global epidemic, collaboration is critical. Thus, it is natural that companies would seek new methods to collaborate with governments, non-governmental organizations, and even rival enterprises around the SDGs’ shared language in order to manage risk, guarantee equity, and contribute to a sustainable and accessible world for everyone.
- A global research survey reveals that the majority of people or 85% of those who were surveyed globally believe that the pandemic has revealed societal issues and has accelerated changes that needed to happen anyway. Business World predicts that “partnerships and alliances will grow in strength.”
4. Stronger manifestation of inclusion, diversity, and equity
- In 2021, we will see a greater emphasis on diversity, equality, and inclusion initiatives by businesses, particularly in the areas of cause and CSR. This is because customers want companies to demonstrate a stronger affinity for the needs and values of a diverse community.
- This strategy will need businesses to be more nimble with their nonprofit funding limits and reporting criteria in order to provide room for trust, genuine partnerships, and sufficient service to disadvantaged groups. Additionally, charities and businesses alike will strengthen their values-based requirements of official partners and suppliers.
- According to Mark Feldman, Managing Director of Cause Consulting, the growing significance of environmental, social, and governance (ESG) and diversity, equality, and inclusion (DEI) is increasing demand for meaningful signature programs and strategies that meet both commercial and social goals. Companies are architecting impact-driven issue leadership, corporate social responsibility, human resources, and community programs that address equitable issues in health, education, and economic opportunity. This effort generates new value for communities, investors, workers, and other stakeholders at the same time.
5. Funds will be transferred to support post-Covid social issues and charitable causes
- Citizen-driven purpose activities will emphasize a stronger connection to the company’s goods, services, and total resources. This is acceptable as long as genuine stakeholder requirements established post-Covid-19 are addressed. A portion of the advertising/marketing budget will be reallocated to assist highly relevant post-Covid societal problems.
- If 2020 taught us anything, it is that mental health is an incredibly under-resourced cause. With increasing awareness of the issue, we believe that companies will begin to not just speak about mental health, but also financially support charity groups that have developed viable solutions and are making a difference every day.
- The explosion of technological innovation aimed at facilitating charitable giving, combined with the recent mandate that all businesses act responsibly toward all stakeholders, including their communities, is creating an ever-increasing number of opportunities to support deserving charitable causes while engaging in everyday activities.
How Consumers Pursue CSR, Purpose, and Sustainability
1. Consumers have been demanding company disclosures
- According to a survey conducted by Hyun-Hwa Lee et al., customers are seeking more transparency about how businesses handle social problems such as forced labor and human trafficking in their supply chains.
- According to Cone Communications research, 89 percent of customers want businesses to convey CSR practices through both websites and social media, and 93 percent want businesses to offer more CSR information via a website.
2. Consumers purchase a product from a company that supports an issue of interest
- Research conducted by Cone Communications shows that over 60% of Americans are hoping that businesses will drive environmental and social change without government regulation. Almost 90% of surveyed consumers said they would buy a product from a company that supports an issue they care about.
- Additionally, almost 75% of customers indicated that they would refrain from purchasing from a business if they discovered the business backed an issue that contradicted their own views.
- According to a study, 90 million Americans identify as ‘conscious shoppers,’ and 72% of customers questioned said that they would actively seek a brand that fits with their beliefs provided the price and quality are comparable.
- According to Mohr and Webbs’ research, many customers place a higher premium on CSR than on product pricing when making purchasing choices.
3. Consumers prefer sustainable products over conventional alternatives
- Consumers need to experience the positive emotions associated with doing the right thing, and many studies have shown that consumers choose sustainable products over conventional alternatives.
- A Nielsen survey reveals that “more than 50% of consumers are willing to pay more for a product or service if the business prioritizes sustainability.”
4. Consumers have been buying more locally produced products
- The research study of Hongwei He and Lloyd Harris published in the Elsevier Public Health Emergency Collection notes that the pandemic has caused consumers to buy more locally produced products instead of foreign-produced.
- According to this research study, the choice between local and imported goods is not just a matter of availability, quality, and cost; it is also a matter of consumer ethics in terms of doing the right (or wrong) thing. The epidemic of Covid-19 will rekindle interest in this area. Additional study is needed to examine consumer nationalism, ethnocentrism, and hostility tendencies and their effect on consumer ethical decision-making. Consumer decision-making has become more ethically charged as a result of the epidemic, which is also likely to push consumers toward more responsible and prosocial purchasing.
5. Consumers hold corporations accountable
- Consumers, workers, and stakeholders value CSR when selecting a brand or firm, and they hold companies responsible for affecting social change via their corporate principles, practices, and profits, according to Business News Daily.
How Employees Pursue CSR, Purpose, and Sustainability
1. A company’s sustainability strategy is a big factor in employees’ choice of workplace
- The sustainability strategy of a business has a significant impact on where today’s top talent chooses to work. Employers that prioritize the triple bottom line: people, planet, and money are attracting the next generation of workers.
- Corporate revenue has been increasing since the recession ended. Businesses are urged to invest their increasing profits in charitable initiatives.
2. Workers choose companies that advocate for societal issues
- The millennial workforce prefers to work in companies with leaders that advocate for important issues in society.
- According to the Center for Creative Leadership, almost 85 percent of millennials value making a good impact in the world above professional accolades.
3. Employees have openly protested
- An Adidas employee who experienced racism in the workplace went on strike to protest the lack of apology and admission she asked from her employer.
- Clarkston Consulting notes that stakeholders such as employees seek to see action and not just published statements of intent to change.
- Amazon employees have also criticized hazardous working circumstances, including a lack of protective equipment and proximity to those who have tested positive for or died from COVID-19.
4. Employees have been volunteering
- According to Cone Communications research, 74% of workers report that their jobs are more satisfying when they have the chance to make a good difference at work.
- AXA workers have volunteered their talents and time to charity organizations. More than 2,400 AXA employees globally have collectively donated over 2,000 hours to 55 different projects during the Virtual Day of Giving. Volunteer activities included writing to lonely elderly residents, reading to youngsters through video to promote literacy, counseling young people on career choices, and monitoring animal movements for zoological research. The research report from Vigeo Eiris also notes that the medically trained staff of biotechnology and pharmaceutical companies such as Merck & Co. and Pfizer have also been volunteering to help fight the pandemic.
5. Employees become more engaged and committed when their companies have CSR initiatives
- According to the Center for Creative Leadership (CCL), CSR activities boost employee engagement and loyalty to the organization. According to CCL’s Retiring the Age Gap research, the majority of working people, regardless of generation, want the same things at work — and are devoted to their organizations for largely the same reasons.
6. Resignation because of disagreement with the company’s way of handling pandemic concerns
- According to a research report released by Emerald Publishing Limited, a renowned engineer and vice president at Amazon Web Services quit over the company’s handling of employee concerns during the epidemic.
How Companies Pursue CSR, Purpose, and Sustainability
1. Companies have been investing in alternative and renewable energy sources
- Lego, the toy manufacturer, has been working to reduce its environmental effect by spending millions of dollars in waste reduction and climate change mitigation. Some of its other environmentally conscious efforts include the use of sustainable materials, reduced packaging, and alternative energy investments.
- Johnson & Johnson also seeks to reduce its environmental impact by investing in different alternative energy sources. The company also works to provide safe, clean water to communities.
- Google has also shown its environmental stewardship by investing in sustainable office space and renewable energy sources.
- In December 2020, Vanguard Renewables has launched a Farm Powered Strategic Alliance with food manufacturers and retailers that seek to repurpose food wastes into renewable energy. According to Business Wire, Unilever, Starbucks, and Dairy Farmers of America have joined, pledging to reduce food waste and repurpose it, as well as to work toward decarbonization objectives.
2. Company profits are being donated to charitable causes and to COVID-19 global fund
- TOMS has donated one-third of its profits to different charities that support educational opportunities as well as mental and physical health. As of April 1, 2020, the business has allocated all philanthropic contributions to the TOMS COVID-19 Global Giving Fund.
- Last December 2020, Amazon donated $2.25 million for the preservation of home ownership of hundreds of Nashville-area residents who have faced housing insecurity due to the unprecedented challenges of the past year, which include tornado recovery, the ongoing COVID-19 pandemic, job loss, and tax increases. The Housing Fund will use this gift to establish the Housing Resiliency Fund, which will provide financial grants to assist low- and moderate-income families in maintaining their homes and essential long-term financial stability.
- Procter & Gamble is also donating tens of millions of dollars for COVID-19 relief endeavors. Additionally, the business has committed to doing 2,021 acts of good this year (2021), beginning with its next wave of donations of health, hygiene, and cleaning goods, as well as personal protective equipment (PPE) and financial assistance.
- According to Marshall Crawford, CEO of The Housing Fund, “Amazon’s donation will help us keep more families in their homes, which is always our ultimate goal because home ownership is critical for long-term wealth building. Throughout Middle Tennessee, there is a growing divide between wages and housing costs, forcing moderate-income families to make unprecedented choices about the future of their lives.”
3. A socially responsible hiring process has been implemented
- Starbucks, according to Business News Daily, has a socially responsible recruiting procedure in place to diversity their staff. Starbucks has been focusing on hiring more refugees, veterans, and young people who are just starting their careers.
- Starbucks has been excellently creating job opportunities for various social groups. Thousands of combat veterans were recruited as the business opened dozens of military family shops throughout the United States. The company cooperates with the UN Refugee Agency in order to continue hiring thousands of refugees in the coming years. Also, Starbucks has prepared over 10,000 positions to help young people get their first jobs.
4. Sustainably-sourced materials are being utilized
- Business Wire announced in December 2020 that Gap Inc. has entered the United States. Cotton Trust Protocol and Textile Exchange’s 2025 Sustainable Cotton Challenge as part of its integrated sustainability strategy and to assist it in meeting its goal to source all cotton responsibly by 2025.
- According to Alice Hartley, Gap’s Director of Product Sustainability, “continuous improvement is critical to Gap Inc., which is why we’ve committed to sourcing more sustainable fiber through the US Cotton Trust Protocol. As part of our commitment to address climate change by aligning with the best science and industry practices, we’ve set ambitious targets across multiple metrics to reduce carbon emissions.
- Cotton Trust Protocol is a no-brainer. With two-thirds of American cotton grown without irrigation, this enables us to continue our commitment to sustainable cotton and to assist American cotton farmers.
5. Healthcare initiatives have been in place
- Pfizer has started some healthcare initiatives such as providing accessible health services to children and women in need and spreading awareness about noninfectious diseases. These healthcare initiatives are reflections of the company’s focus on corporate citizenship.
- The IICA research report notes that the partnership of companies and the public sector has brought investments in many strategies for medical research, mass testing, and hand-washing campaigns. In close collaboration with the government department, companies have also undertaken efforts to capacitate and educate health care professionals on the use of technology throughout hospitals.