Organizations with a social responsibility policy are often more attractive in the eyes of their customers, suppliers and employees. As a bonus, they are also in the government’s good graces.
Are social responsibility policies advantageous? Maybe so, particularly because companies that adopt such policies are less likely to be corrupt or fined, according to a recent study by Princeton University.
Researchers Harrison Hong and Inessa Liskovich find that these companies are fined up to 38% less than any other organization. Note that these fines were those issued by the authorities in charge of punishing corrupt American companies abroad.
General Delineation
The definition of corporate social responsibility (CSR) varies from one organization to another. In general, according to the World Business Council for Sustainable Development, it is “the continuing commitment by businesses to contribute to economic development while improving the quality of life of employees and the community and society at large.” It is often linked to the principles of sustainable development, for example.
For US researchers, companies that have implemented CSR policies benefit from a halo effect, that is to say, a cognitive bias that affects the positive side of an element on other characteristics. Meaning, they are generally perceived positively and are subject to greater indulgences.
“This halo effect phenomenon is common in human psychology,” says Denis Morin, professor in Human Resources Management at the UQAM School of Management. For example, it is recognized that the great physical beauty of a person is incorrectly associated with their intelligence and superior interpersonal skills.”
Proven Effects
This halo effect can also help companies attract and retain employees. But for Morin, it is essential that their CSR practices result in a genuine concern for the welfare of their employees. “You have to be 100% consistent for failure to give rise to a certain degree of cynicism,” he says.
The companies have every interest to concretely meet their CSR policies rather than be used only in projecting a beautiful image of themselves. “Beyond the managerial discourse, various studies show that the practical implementation of CSR practices and sustainable development is more attractive to job seekers.”
Other benefits include greater commitment, greater creativity and greater work performance by employees, increased loyalty to the organization and a significant well-being in the workplace, says the specialist.
Through the Looking-Glass
To achieve this, Morin believes that the boards of directors and managers must be exemplary and act as role models. “It is not easy, because it requires integrity and authenticity,” he states.
To reward the best interests of the organization on the personal interests of its members, he advises executives and employees to regularly step back and look at how well the CSR policies are implemented in reality. “They have to periodically perform a personal and professional introspection and analysis of organizational processes in the desire to improve business processes while taking into account the well-being of employees,” he says.