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CSR & the Bottom Line: World's Largest Brands See Financial Performance Aligned with Social Responsibility

business strategy, CECP, community affairs, community engagement teams, CSR, CSR teams, engagement with society, giving officer, Marketing, Pr, Public relations, purposeful brands, Social responsibility, The Conference BoardCorporate Community Affairs Pros Taking a Leading Role in Business Strategy

The link between a company’s business strategy and its engagement with society is becoming ever more vital, as are the people within the company leading that connection, according to new corporate societal engagement research from CECP, the “CEO Force for Good,” in association with The Conference Board. With this growing recognition that long-term business performance is tied to social responsibility, companies are now allocating bigger budgets to their community engagement teams, elevating giving officer roles and responsibilities, and ensuring that both employees and customers are able to show their commitment to giving back through the brand.

“The leading companies in today’s global economy have infused societal needs in business strategy, binding the wellbeing of their communities to the health of their bottom line,” said Daryl Brewster, CEO of CECP, in a news release. “Giving in Numbers is an essential handbook for businesses seeking to be industry-leaders of corporate societal engagement in the coming years.”

For more than ten years, Giving in Numbers has been the leading study on the funds, resources and skills that companies invest in globally to solve pressing societal challenges. Key findings from this year’s survey include:

  • Business performance is tied to social responsibility: Companies that increased total giving by at least 10% between 2013 and 2015 saw increases in median giving as a percentage of revenue and pre-tax profit, as opposed to all other companies that instead saw decreases in both metrics. Companies with a stronger sense of purpose also had stronger financial and Environmental, Social, and Governance (ESG) metrics.
  • Bigger Budgets: Total giving grew slightly with nearly half (47%) of companies in a three-year matched set between 2013 and 2015 reporting an increase in median total giving—by 1%.
  • Elevation of roles and responsibilities: With companies seeing the bottom-line benefits of adding resources to the community engagement office, corporate giving teams are not only expanding (full-time equivalent employees rose 3% from 2013 to 2015), but their prominence within the company is rising, with 29% of teams reporting closer alignment with the CEO’s office. Further, teams are being called on to share materially significant data: 56% of companies say their corporate citizenship department provided ESG information to a particular investor or the company’s investor relations department.
  • Employees and customers seeking out new ways to give back through the company and the brand: Employee volunteer participation rate with their company’s community efforts continued to rise to 33% in 2015 from 28% in 2013. Additionally, about half of companies saw building trust with consumers and other stakeholders as a goal of their societal engagement programs. Fifty-five percent of companies used increased trust (e.g., Edelman Trust BarometerNielsen Global Consumer Confidence Survey, etc.) as a benchmark of success for their community investments.

“Data from 2016’s Giving in Numbers all point to the growing importance of the corporate societal engagement office in leading companies around the world, which should come as no surprise when increasingly, business performance is tied to social responsibility,” said Carmen Perez, director of data insights at CECP, in the release.

“With employees and customers increasingly rewarding responsible businesses, companies are underpinning their business strategies and brands with purpose,” said Jonathan Spector, CEO of The Conference Board, in the release. “The data show those efforts starting to pay off, so it’s no surprise to see companies doubling down on their community engagement by expanding teams and giving department leaders more of an audience with the CEO.”

Additional learnings from this year’s report include:

  • Measuring societal outcomes and/or impacts became a more widespread practice: Demonstrating impact and transparency is critical for companies, and as such 87% of companies measured societal outcomes and/or impacts of at least one grant in 2015, up from 79% in 2013. Most commonly, companies focused their measurement efforts on strategic programs.
  • Investing with purpose goes along with societal engagements: Companies that took part in impact investing supported community programs more overall. Median total giving for companies active with impact investing was more ($25.7 million) than that given by those not active in impact investing ($15 million).
  • Philanthropic Leverage, a component of “good beyond giving,” is on the rise: Philanthropic Leverage, which refers to the average monetary contributions from employees and non-employees, has increased in the last three years. Philanthropic Leverage is also a component of “good beyond giving” (socially driven corporate activities that are additive to total giving). Companies with higher growth rates of total giving were also the ones with higher Philanthropic Leverage growth rates.

Download the complete report here.

CECP, a coalition of more than 200 of the world’s largest companies with a combined annual revenue of more than $7 trillion, released, in association with The Conference Board, Giving in Numbers: 2016 Edition, a report on the largest societal engagement survey of 272 companies, now in its 11th year.  

Source: PR Newswire; edited by Richard Carufel

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