CSR, a driver of cost reduction

Despite the adoption of CSR by many companies only a few do it well, and even fewer know how to effectively leverage their CSR strategies and initiatives with their stakeholders-customers, shareholders, suppliers, and employees according to a study conduced by STING Consultants on Corporate Accountability.

These companies are missing significant opportunities to build corporate brand reputation, talent management, and even cutting costs during times when companies have no discretionary spending, according to the article.

CEO of STING Consultants Ruchi Gunewardene said, “the challenge that managers have is to add value to the business without investing any money. And, our feedback to several companies highlighted how they can capitalize on their CSR activities by offering practical suggestions on leveraging them internally and externally.

The adoption of a strategic approach to CSR actually enables businesses to reduce costs as well as risks whilst creating new opportunities for them, resulting in building their businesses and motivating employees in these difficult times.” STING Consultants have been presenting their findings to several companies including CTC, Eagle Insurance, Brandix, Unilever, People’s Leasing and MAGA Engineering with considerable positive feedback.

“To maximize the effectiveness of CSR, businesses must first identify their stakeholders and establish a mechanism of engagement with them. This requires a level of transparency to be developed by the organization.

Reputed companies adhering to this approach achieve this transparency and accountability by showcasing their achievements as well as their impacts, by publishing a sustainability report,” said Gunewardene.

The Global Reporting Initiative (GRI) based in the Netherlands offers a globally applicable sustainability reporting guideline for organizations to follow, which can be accessed on the web.

According to Gunewardene, this is aimed at assisting organizations in setting out a structured process for the company, culminating in a report which can be used to track performance over time.

Many of the world’s leading companies have declared their voluntary adoption of these guidelines, with a few Sri Lankan companies having also set themselves up to do so.