Based on a company’s revenue and size, the Indian Companies Act of 2013 requires them to spend at least 2% of their average net profits on Corporate Social Responsibility (CSR).
While many companies in India, especially startups, are not mandated by law to do so, they still find it ethically imperative to engage the company as well as its employees in CSR activities. The act of giving back to society is seen not only as engaging but also as bolstering their brand.
However, the effectiveness of CSR activities remains highly dependent on the type of activity a company chooses to undertake. Factors such as impact, brand reputation, and employee engagement play a crucial role in selecting a CSR activity for a company to participate in.
Why Choosing the Right CSR Activity Matters
For any company, choosing the right CSR activity goes beyond its ethical implications. Any activity should take into consideration the needs of employees, the current societal landscape, and the company’s own image.
With the right CSR activity, you can ensure that the actions of a company and its employees align with the values that define the company. Furthermore, it is also important to consider business implications and long-term effects.
The right CSR activity can help in building trust between the company and its employees, customers, and communities. It also helps in creating a measurable and sustainable social impact rather than just meeting the minimum CSR requirement.
Key Factors to Consider When Selecting a CSR Activity
When selecting a CSR activity, it is essential to consider not only what the company stands for, but also what the local community needs and values.
Alignment with Company Values and Industry
Select a CSR activity that not only aligns with the values of your company. If the chosen activity is also relevant to your industry, that can be advantageous, though it need not be necessary. For example, a food delivery company choosing zero food waste as its CSR activity is likely to be a huge morale booster.
Understanding Community Needs
For smaller businesses as well as regional offices, a thorough knowledge of their community, ergo customers, can be extremely helpful when it comes to choosing a CSR activity. Any venture taken to alleviate local issues, like even a simple clean-up drive, can significantly boost the company’s reputation and make employees feel more involved.
Employee Involvement
Ensure that any chosen CSR activity will see employee participation. Through small surveys and general conversations, understand the issues that your employees feel strongly about, as well as activities that they feel more inclined to participate in.
Long-Term Sustainability
Any chosen CSR activity should be sustainable in the long run. This will ensure that the impact of the actions undertaken by the company and its employees remains evident for a long time and feels more meaningful.
Measuring Impact
When selecting a CSR activity, consider its potential impact on the company, its employees, and society. Activities like a literacy drive may seem daunting, but their impact can hardly be underestimated. With proper organisation and attention to detail, ensure that the impact of any chosen activity is maximised to the best of the company’s capabilities.
Partnerships and Collaboration
Many companies choose to participate with NGOs or other companies for their CSR activities. Such partnerships can reduce the burden of the organisation, provide the company with relevant resources, and help create meaningful connections between companies as well as people.
Steps to Choose the Right CSR Activity
With the right steps, a company’s CSR activity choice can be a significant boost to its effectiveness, brand reputation, and customer connections.
Identify Company Strengths
Evaluate the mindset of your workforce, what they are skilled in, and how that can help with certain CSR activities. For example, good communication skills can be effectively applied to literacy and training programs.
Map Stakeholder and Community Needs
Consider the types of activities that company stakeholders are interested in, as well as the issues affecting the local community. Finding a middle ground is ideal in such situations, as it not only helps you adhere to the company’s values but also allows you to support those around you.
Shortlist CSR Activities
Keeping the company’s strengths, values and interests in mind, shortlist the activities that you think will appeal to your employees the most. You can discuss your views with those in the company to learn their perspectives, while ensuring that the activity you choose aligns with the company’s priorities.
Pilot Programs Before Scaling
It is always a good practice to conduct a test run before any major initiative. Once you have selected one or more CSR activities, organise them on a small scale with the help of volunteers. The real-life execution will help address any potential issues and prepare you to spearhead the initiative on a larger scale.
Execute, Monitor and Revise
Following a successful pilot run, it is now time to launch the initiative. Once in action, ensure that you observe the impact of the chosen CSR activity, measure employee engagement, evaluate community interest, and remain open to genuine feedback. Through this, revise the CSR plans to make them more effective and engaging.
In the End…
Choose a CSR activity that balances company values, employee engagement, and community needs. Prioritising one over others can lead to inconsistent efforts and impacts that can lead you back to the drawing board.
Do not look at CSR as a bare minimum to be done to either meet compliance requirements or societal expectations. Even apart from the ethical obligations, CSR activities can be viewed as long-term investments in society that will benefit you in the future. A better community means a better economy that is indeed sure to benefit you in one way or another.
