As organisations and individuals are becoming more socially conscious, the importance of CSR has gone well beyond just a mandatory activity. Today, CSR is a way to bring about real change and leave a positive impact on society and the environment. For this to happen, optimal use of CSR funds and resources becomes necessary.
The growing importance of social responsibility has created new opportunities for companies to make a mark in the world, but it also requires businesses to think differently. Companies are looking for ways to delve deeper into the world of CSR and tap into the boundless economic, social, and environmental prospects that can be unlocked with responsible business practices.
The effects of CSR initiatives
CSR can bring about a variety of positive competitive advantages in many ways. For example, companies that implement CSR programs can increase their sales and profits, improve company reputation, enhance access to capital and markets, reduce operational costs and improve productivity.
The power of decision-making in CSR falls within the corporate entity since this is not a state or government project. The board has the authority to decide how to spend the company's CSR fund on social welfare, and the company is responsible for these decisions. This approach eliminates bureaucracy, making organizations more responsive and accountable to those they serve.
Positive Brand Image
As CSR is a significant part of the business world, corporates must take initiatives to make this planet a better place to live. They can also differentiate themselves from their peers by resorting to unique CSR initiatives and showing people that they care beyond business profits. This will help organizations build a positive brand image and earn customer trust and loyalty.
Companies can take the competition head-on, by taking CSR seriously. It can be a great opportunity and a platform for long-term survival and growth. Employees are less likely to leave the organisations if they find a sense of purpose through CSR activities. Thus, companies can attract and retain top talent, which eventually translates into higher business productivity.
Like any other business function, CSR requires funds too. There are various ways to attract CSR funding however, it is equally important to ensure you optimize your CSR funds. Strategic use of CSR funds will help you get better results and create a difference on a large scale. Here, we take a look at some effective tips for the optimal use of CSR funds.
Quick tips for using your CSR funds effectively
Partner with mid-size, agile NGOs
Choosing the right partner to implement your CSR program is a crucial step. Partnering with the wrong NGOs will welcome negative consequences such as poor returns, damaged reputation, and ineffective campaigns. The partners selected must have a proven track record of successfully running similar programs.
It is advisable to partner with mid-size NGOs that can accept and process the CSR funds in an agile manner. Their systems and processes should be flexible to ensure faster execution of CSR strategies and funds as opposed to large bureaucratic organisations. Partnering with a well-established NGO will not only help you improve your CSR efforts but make them time and cost-efficient.
Look for Investment-heavy programs
If your company is backed with CSR funds, you may want to invest in programs that promise quick and smart utilisation of those funds. A more investment-heavy program will have less downtime and help you spend your funds effectively.
Invest in replicable programs
There are some programs that have a heavily customised operating model. These are designed to cater to the needs of particular geography and/or community. Such programs are not easily replicable since they suit a specific set of requirements.
On the other hand, programs like school-based WASH (Water, sanitation and hygiene programs) have a structured model. It is recommended to invest CSR funds in such programs since their implementation can be expedited based on a standard model.
Get clarity on the company’s CSR vision
Clear and compelling ideas are what drive effective CSR efforts. A goal-focused CSR strategy will help you make more informed decisions about how to utilize your CSR funds.
Getting clear on what positive impact your company's CSR initiatives would look like would help with various aspects, including why your company may choose to invest in an effort, and why it may pass on other quality and meaningful opportunities.
Select causes wisely
Every business has a responsibility towards its employees, consumers, and society. But it can be challenging to understand where to allocate funding resources. With hundreds of causes, companies find it difficult to focus on specific cause areas and effectively channel their CSR funds.
Organisations should focus on identifying the right cause that aligns with their company’s mission and vision. This will help them allocate funding resources to projects that can positively impact society.
The bottom line…
Businesses cannot be successful when the society around them fails. CSR initiatives provide an opportunity to look beyond your company and promote change and progress throughout society. While it may seem daunting to think about, in fact, it takes very little to make a positive impact.
When companies commit to a cause, they build a bridge between their business and the social impact they create in society. To carry out these initiatives, companies should utilize their CSR budget in the most effective manner.