Corporate Social Responsibility Monitor
A recent survey of 20,000 people in 20 countries offers some fascinating insights into the way consumers, and societies at large, perceive the social and environmental responsibilities of business. Corporate Social Responsibility Monitor 2001: Global Public Opinion on the Changing Role of Companies identifies those aspects of corporate practice that matter most to the general public. It also reveals some intriguing differences in priorities between different regions of the world.
The survey was undertaken by Environics International, and involved interviews with around 1,000 people in each of 20 countries including the USA, Canada, Mexico, Britain, France, Germany, Japan, India, Russia and Nigeria.
The key findings are as follows.
1. Significant numbers of investors take a company's social performance into consideration when making investment decisions
In the USA, where 61% of people own shares, more than a quarter said they had bought or sold shares on the basis of a company's social performance. A similar picture emerged in Canada, Japan, Britain and Italy (see table).
Percentage of share-owners who have bought or sold shares because of a company's social performance, by country
2. In wealthy countries, social responsibility makes a greater contribution to corporate reputation than brand image
A company's commitment to sound labour practices, environmental stewardship and good community relations plays an influential role in how it is perceived by the public, especially in developed countries. The effect can also be seen, albeit to a lesser degree, in developing countries.
In 20 developed countries surveyed, CSR-related factors collectively accounted for 49% of a company's image, compared with 35% for brand image and just 10% for financial management.
3. Companies that ignore social responsibility place market share at risk
Consumers, especially those in North America, are likely to vote with their wallets against companies whose social and environmental performance is perceived to be poor. Forty-two percent of North American consumers reported having punished socially irresponsible companies by not buying their products. In Asia, by contrast, there is less pressure to follow ethical standards. There, only eight percent of consumers said they had boycotted companies with low standards of corporate behaviour.
Percentage of consumers who have punished companies for being socially irresponsible, by region
4. Views and behaviours of opinion leaders indicate that consumers' social expectations of companies will continue to grow
In the words of Environics International, 'opinion leaders continue to expect more from companies than the general public, and they are more engaged in issues related to corporate social responsibility'. When compared with the general public, opinion-formers have higher expectations of companies, and are 50% more likely to boycott poor performers.
These findings, it believes, 'suggest that in coming years companies will come under even greater public pressure to deliver on their broader social responsibilities'.
5. North American consumers represent the most socially demanding market for companies
Environics International has devised its own metric for measuring how socially demanding an economy is. The 'CSR Index' takes into account:
Using its index, Environics International calculates that the most socially demanding markets for companies are the USA, Canada, Mexico and Britain. So-called 'second tier' countries include Argentina and several European Union member states. Only weak pressure is exerted on businesses in Asia, France, Turkey, Brazil and Chile. The least demanding markets identified in the survey are India, Russia and Nigeria.
6. Two distinct groups of citizens, making up a third of the world, are engaged in pressurizing companies to assume greater social responsibility
On the basis of responses from interviewees, Environics International identified six distinct types of consumers. Of these, two could be categorized as 'activists' - first, 'Conventional Activists' and second 'Social Activists'.
Conventional activists 'demand that corporations fulfill their operational responsibilities - that is, duties they encounter in the course of their business'. Social activists, on the other hand, 'expect companies to exercise "citizenship" by going beyond the sphere of their everyday operations and playing a socially minded leadership role'.
Conventional activists are more likely to be North Americans with high levels of education and income. Social activists are more evenly distributed across the global population.
Significantly, Environics International reports that activists have very high levels of Internet use, 'suggesting this medium is key to reaching them'.
The other categories identified in the survey are 'Undemanding Pro-Corporates', 'Traditionals' and 'Desperate Inactives', all of which 'are favourable towards corporations in general'.
'Demanding Disgruntleds', like Conventional Activists and Social Activists, 'tend to be more anti-corporate'.
This kind of segmentation analysis can help a company better design and target its corporate responsibility policies, Environics suggests.
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