Corporate Citizenship Still Critical to Businesses Despite Recession

Corporate Citizenship Still Critical to Businesses Despite Recession

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Corporate Citizenship Still Critical to Businesses Despite Recession
Sept. 24, 2009 — No matter how bad the economy gets, it appears that corporate citizenship practices are ingrained in increasing numbers of American businesses, according to new survey results.

The 2009 State of Corporate Citizenship survey, a joint project of the Boston College Center and The Hitachi Foundation, found that many business leaders report that attention to corporate citizenship efforts is more important in a recession. As in the 2007 survey, the most recent data show that attitudes of support for corporate citizenship are strong but there remain some gaps between those beliefs and the practices and investments of some businesses.

“As we’ve been flooded by announcements of business cutbacks and misconduct over these past months, trust in business dropped. Many members of the public have undoubtedly wondered if some corporations should have their citizenship curtailed or revoked,” said Barbara Dyer, president and CEO of The Hitachi Foundation. “This survey shows that business leaders understand that corporate citizenship entails great responsibilities as well as extensive rights. Most are diligently working and investing toward improving their efforts to more fully meet these responsibilities.”

Chris Pinney, director of research and policy at the Boston College Center for Corporate Citizenship, said: “Corporate citizenship is weathering the storm. Despite the economic downturn, the value of corporate citizenship is growing as companies realize greater reputational advantage. The survey also reveals companies are more committed to communicating about their efforts related to social issues and concern for the environment.”

Key survey findings:

- Despite upheaval in the economy, a majority of U.S. companies are not making major changes in their corporate citizenship practices. Of those who made changes, 38% reduced philanthropy/giving, 27% increased layoffs and 19% reduced research and development for sustainable products.

- Most U.S. senior executives believe business should be more involved than it is today in addressing major public issues including health care, product safety, education and climate change. Surveyed in June, just as the national debate on health care began to intensify, 65% said business should increase its involvement in this issue.

- Reputation was cited by 70% as a driver for corporate citizenship, tied for the top spot with “it fits our company traditions and values.”

- The citizenship response during the recession differed between larger and smaller companies. Large companies significantly increased their investments and involvement in citizenship activities, but were more likely to impose layoffs. Small firms stayed committed to their emphasis on treating employees well by minimizing layoffs. But they significantly decreased attention to other aspects of citizenship.

- Based on current economic conditions, 15% of companies are increasing research and development for new sustainable products; 11% are increasing corporate citizenship marketing and communications; and 10% are increasing local and/or domestic sourcing or manufacturing.

- Half of the businesses are supporting skill development for employees making less than $40,000 annually and see these efforts as boosting productivity.

- Only 34% of executives who responded to the survey said greater regulatory oversight by the federal government is an important part of solving the current economic crisis and creating a more stable economy.

To download a PDF of the survey results, log on to http://rosenbergcommunications.com/projects/thf/socc2009.html.

About the SurveyConducted by GlobeScan between June 4 and June 23, 2009, the survey queried 756 executives, 36% of whom were at small businesses (1-99 employees), 24% at medium (100-999), and 40% at large companies (1000 + employees). The biennial survey was first conducted in 2003.

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http://dreamlearndobecome.blogspot.com This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.