CSR initiatives hold great significance and are a huge priority for customers of the present era. A survey conducted by Forbes states that over 87% of customers will select a brand that works towards an issue they care for. Consumers across the world are becoming more socially conscious and concerned with the involvement level of businesses in social issues. A customer no longer wants to be reduced to just a ‘buyer’ but wants to have a more engaging interaction with a brand that is working for the greater good.
What makes an effective CSR leader?
Top corporate leaders are the ones who inculcate a sense of responsibility and lead their organisations towards adopting sustainable business practices. Sudha Murthy, for instance, sets the benchmark for CSR initiatives and firmly believes that it is not a mere job but passion that leads the change. Infosys spent almost Rs. 360 crore towards multiple CSR schemes in 2020. The focus was on COVID-19 relief work activities, followed by education and health-related initiatives.
Another famous financial leaders leading the change in the environment mandate is Anand Mahindra. He is passionate about the causes he works towards and leads by example. Under his supervision, Mahindra & Mahindra has set global benchmarks for sustainability and corporate success.
One of the top financial business leaders in India, Sanjiv Bajaj, through Bajaj Finance’s CSR arm, spent over Rs. 107 crore on social initiative programmes, which included undertaking COVID support programmes as well as focus on the existing education and healthcare mandates. Organising mass vaccination campaigns is one of the ways the Bajaj Group has been making a positive difference in society, with the most recent one that was held in September 2021 in collaboration with the Pune Municipal Corporation (PMC). 1 lakh doses of the Covishield vaccine were provided by the Bajaj Group for the campaign.
CSR allows consumers to be a part of many socio-economic reforms. In India, CSR is no longer a concept mandated by the government which requires business organisations to spend a certain percentage of their net profit. It is also shifting to a more voluntary action supported by socially responsible corporate leaders to be a part of the change they want to see. For instance, the Bajaj Finserv ‘BEYOND’ flagship employability initiative provides training programmes to make graduates employable in wake of the present skill shortage that exists in the country.
Business Application
There are particular ways in which top corporate leaders in India can focus on their CSR initiatives to keep their customers coming back for more.
Take notice of how the customers perceive your CSR
Businesses should not be viewed as just profit-making organisations but also be perceived as socially and environmentally conscious brands. Some fashion brands, for example, have a bad reputation for generating waste and using copious amounts of water while manufacturing garments. H&M, a popular fashion brand wanted to get rid of this industry image and actively spoke about their initiative – H&M Conscious that focused on transparency about the manufacturing of their products sustainably. As a result, it is perceived as an environmentally conscious and ethical brand.
Give priority to those CSR initiatives that involve the customers
The most prevalent CSR initiatives are those that directly impact your customer’s experience with the firm. This would include CSR initiatives that support your front-line employees or have something that involves your products. For instance, Café Coffee Day employs disabled people and has a special induction program for those with hearing and speech impairment. Customers get more attached to a brand after witnessing CSR initiatives undertaken. Indian consumers are gradually shifting their purchase patterns to include local products and go for brands that put local communities and economies at an advantage or are environmentally conscious.
Each customer should receive some sort of communication or update about the CSR initiatives of a company. This could be local sourcing, promoting artisans, or green manufacturing undertaken by the organisation, thereby directly enhancing the customer experience. If your processes are environmentally conscious, communicate these not-so-popular environmental initiatives to your clients. People are moving towards being green, so the communication could effectively create long-term loyal customers.
Elucidate how your CSR efforts directly translate into customer benefits
If your initiatives bring down costs, highlight that this cost-saving allows you to offer lower-priced final goods to your customers or that the money saved can be invested in areas that enhance the customer experience or enter a new line of business that creates customer value. Another way to get your customer to participate in your CSR mandate is to offer them direct savings, for e.g., loyalty points or cashback to customers who use reusable bags or bring back empty containers.
The customer should not be expected to pay extra for your CSR
If the customers are naturally benefitting from your CSR initiatives, then it’s a win-win situation for both the business and the customers. However, companies that tend to pass on their CSR costs to the customers should be wary, as customers are price sensitive. If CSR has a price attached to it, the customers can respond negatively.
Take IKEA, for instance. It uses social responsibility to hold on to its customer base. They do this through a range of affordable and energy-efficient goods that customers won’t find anywhere else. They go a step further and encourage customers to gain from IKEA’s recycling program that responsibly disposes of the customers’ used products on their behalf, which otherwise would end up in landfills.
This type of beneficial CSR is what draws a customer to the brand and keeps them loyal. In conclusion, it can be observed that CSR initiatives do help build brand loyalty but communicating your initiatives is vital in improving the customer attitude towards your business.
At every stage, an opportunity is presented to organisations to play a socially responsible role. From product manufacturing to product distribution, product sales and the company’s employability mandate, customers observe how a business is providing for its employees and the entire community. Customers no longer want to just own the brand or be sold to; they want to be part of the social change the brand is creating. They want to build an emotional connection with a brand that cares for the world through its responsible initiatives.
