Corporate social responsibility programmes can offer more than a good reputation

Dubai: Corporate social responsibility (CSR) programmes can give companies more than just a great reputation in their society.

Businesses engage in CSR programmes, which address environmental, societal and humanitarian challenges, primarily to improve company performance. On the surface, it appears that businesses spend millions on such programmes to improve their reputation in their communities. But there are other factors that lead to internal benefits to a company and its stakeholders.

CSR programmes can create a corporate culture among employees, which can help extend their years of employment in the company.

“Corporate social responsibility has an influence on employee engagement. Having a corporate culture can align employees’ principles and values and it can create employee brand recognition. So employees will recommend their company and that can retain them,” said Cindy Arkin, regional knowledge and marketing coordinator at Mercer, a human resource and related financial services consulting firm based in the US.

Arkin said CSR-related health programmes catered to employees can boost production and contribute to a company’s bottom-line.

“A healthy workforce will make a company more productive, which affects its bottom-line,” she said, adding that stakeholders can be positively affected by this as well.

In the Middle East, 82 per cent of companies indicated that the health and wellness of employees is an important component of their CSR and sustainability initiatives, according to Mercer’s Corporate Social Responsibility and Sustainability Programs, Policies and Practices survey.

Meanwhile, in some cases CSR and sustainability programmes can lead to reduction of a company’s costs, according to Arkin. For instance, a company that invests in a sustainability program may develop a product that reduces energy consumption, which can cut down the company’s electricity costs.

CSR programmes are becoming part of the key strategies of businesses in the region. So much so, 62 per cent of companies in the Middle East and Turkey view CSR programmes as part of their company’s founding mission, highlighted the report.

“We are seeing that companies are looking at longer-term, sustainable projects for their CSR programmes, rather than one-time initiatives,” Arkin said.

The report showed that 82 per cent of companies are moving toward this direction in the Middle East and Turkey.

Among the UAE-based companies that are developing their CSR and sustainability initiatives is telecom service provider Etisalat. Etisalat discussed a number of its CSR-related projects in Tanzania, Nigeria, Egypt and Sri Lanka during the CSR Summit last week.

These range from making education more accessible to financially-challenged students to ensuring there is available drinking water to villagers, to name a few.

Etisalat has seen a “good return on investments” and “more profit” from their business-related CSR activities, said Ahmad Bin Ali, group senior vice president of corporate communications at Etisalat.

“Innovative services open new applications to help communities. The applications can give us a chance to coordinate with different suppliers and vendors to engage in different activities, which opens business streams between Etisalat and different vendors,” he said.

When asked how much does the telecom service provider spends on CSR and sustainability programmes, Bin Ali said: “It varies from country to country,” without providing a figure.

He added that “these initiatives are worth a lot but don’t cost much.”