The evolution of CSR to ESG and the implications for comms

Increasingly, companies and brands are finding that their key stakeholders believe that simply “doing good” is no longer good enough.
 
Today, more and more businesses are embracing the philosophy of “business for good is good for business.”
 
But why? There are two key reasons.
 
Firstly, altruistic and pragmatic interests have aligned. And secondly because of stakeholder demand. People expect the organizations they work for and do business with to act as change agents. In other words, to stand up, speak out and make a difference for the greater good.
 
This is leading to greater demand for transparency as your stakeholders want to know what you’re doing to drive positive social impact – including your goals, commitments and progress.
 
From CSR to ESG
For many organizations, this is propelling an evolution, challenging them to reimagine their corporate strategy, moving from corporate social responsibility (CSR), an approach that believes in doing well by doing good, to environmental social governance (ESG), a systemic application of environmental, social and governance disciplines within a business.
 
The World Economic Forum identified three key trends that are happening as a part of this evolution, all of which have implications for communicators:
 
1️⃣ From message to meaning.
Storytelling will always be important, but now, stories must be supported with data. It’s one thing to say you are committed to increasing diversity within your senior leadership team, but are you setting measurable goals and reporting on your progress year over year? That’s what people want to see.
 
2️⃣ From silos to systems.
ESG issues cannot be addressed in a silo. Think about a topic like diversity, equity and inclusion (DEI). It is not something a committee tackles. It’s a strategic business imperative that’s embedded into the ecosystem of the organization and its culture.
 
3️⃣ From cost savings to value creation.
ESG initiatives are not created to drive down costs. Instead, ESG is about creating opportunity and growth by operationalising corporate purpose. The first step is clearly defining your organization’s purpose and making sure it’s understood and embraced from the top-down and bottom-up.
 
Why purpose? Because purpose matters. Many studies have shown that alignment between personal and corporate purpose is the number one driver of employee engagement. Other stats show that purpose-driven companies have less employee turnover, more revenue and higher market value. With consumers more likely to trust, purchase from and recommend brands with a strongly articulated purpose.
 
💡Now, more than ever, social impact/ESG strategy plays a critical role in driving brand engagement and protecting reputation. As communicators, it’s our job to help organisations tell an honest and compelling story.

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