Reputation Institute: Global Study Shows Strong Business Case for Companies
By Mel Fabrikant Thursday, October 03, 2013, 03:02 PM EDT
to be Socially Responsible but Consumer Trust Falls Dramatically
Seventy-three percent of consumers surveyed willing to recommend companies that deliver
on CSR, but only 5 out of the 100 top companies seen to deliver
Seventy-three percent of global consumers surveyed are willing to recommend companies that are perceived to be delivering on their social responsibility programs, according to a new study from Reputation Institute, the world's leading corporate reputation management consultancy.
While consumer support for companies perceived to be socially responsible is strong, the amount of companies believed to be actually delivering on their CSR programs has dropped dramatically from 12 in 2012 to only 5 in the 2013 study.
Study results show that companies that understand how to create positive perceptions of their CSR programs gain the benefit in terms of sales and recommendations from consumers. However, even the biggest companies in the world are struggling to get their message across to consumers despite spending upwards of $100 million a year on their CSR programs.
“This highlights a major issue for companies who are investing millions in corporate responsibility campaigns and initiatives. Where is their return on investment with consumers?” says Kasper Ulf Nielsen, executive partner at Reputation Institute.
Reputation Institute’s 2013 Global CSR RepTrak® 100 study surveyed more than 55,000 consumers from 15 countries.* Results from the study demonstrate that 59% of consumers would also go out of their way to communicate something positive about companies they see as being good corporate citizens, compared to only 23% for companies perceived to be weak in this area.
“In a world where word of mouth is becoming your number one marking tool, this is a key business driver that companies need to leverage better,” says Nielsen.
According to CB Bhattacharya, E. ON chair professor in corporate responsibility at European School of Management and Technology, the answer to why companies do not achieve the ROI they should, can be attributed to how they treat the business of Corporate Responsibility: “Unfortunately, Corporate Responsibility is still equated to philanthropy in many organizations and hence, given short shrift when it comes to strategic formulation and implementation. Although the top 100 companies all have well developed websites detailing their CR initiatives, how many of them do rigorous research to find out how their key stakeholders view these same initiatives?”
Companies must move from feelings to facts when it comes to CSR strategy
While the CSR RepTrak® 2013 study confirms the business case for investing in CSR programs, it also highlights the struggle in building trust amongst consumers despite company CSR programs.
“One of the main critiques of the CSR field is the lack of data to prove the ROI on activities. Now that the CSR field has grown up from being a feel-good community to having major impact on business value, it’s time to move from feelings to facts,” says Nielsen.
Results from the Global CSR RepTrak® 100 study enable companies to determine a business value for their CSR programs. The 2013 study shows for example, that for every 5 points a company improves its CSR perception, recommendations from consumers increase by 9%. “Companies must recognize that creating social value is a prerequisite to creating business value. That makes monitoring and quantifying the returns on CR essential for mainstreaming CR in practice,” says Bhattacharya.
Four-way tie at the top: Microsoft, The Walt Disney Company, Google, and BMW
For the second year in a row, the CSR RepTrak® 100 study named Microsoft the company with the best CSR reputation. This year, the IT company was joined at the top in a four-way tie with The Walt Disney Company, Google, and BMW.
Microsoft placed first in three out of the four regions where the study was conducted (North America, Latin America, and Asia Pacific). The Walt Disney Company placed first in EMEA—the fourth region.
In terms of rankings for the three reputation dimensions that drive consumer CSR perceptions (Citizenship, Governance, and Workplace):
• The Walt Disney Company has the best perception for Citizenship. Approximately 50% of consumers surveyed agree that Disney is a good corporate citizen that supports good causes and protects the environment.
• BMW has the best perception for Governance. Approximately 49% of consumers across the 15 markets agree that BMW is a responsibly-run company that behaves ethically and is open and transparent in its business dealings.
• Google has the best perception for Workplace. Fifty-one percent of consumers across the 15 markets agree that Google is an appealing place to work who treats its employees well.
*About the 2013 Global CSR RepTrak® 100 Study
The Global RepTrak® 100 Study measures 100 of the most highly regarded companies across the 15 largest markets in the world covering 75% of the global GDP. It identifies what it takes to have a strong global CSR reputation, and how leading companies are perceived. More than 55,000 consumers were surveyed during January-February 2013.
For the complete results of the 2013 Global CSR RepTrak® 100 Study, please go to, http://www.reputationinstitute.com/thought-leadership/csr-reptrak-100
About Reputation Institute
Reputation Institute is the world’s leading reputation-based advisory firm, founded by Dr. Charles Fombrun and Dr. Cees van Riel in 1997. We enable many of the world’s leading companies to make more confident business decisions that build and protect reputation capital and drive competitive advantage. Our most prominent management tool is the RepTrak® model for analyzing the reputations of companies and institutions best known via the Forbes published Global RepTrak® 100, the world’s largest study of corporate reputations. Businesses and executives regularly discover best practices in reputation management by affiliating with our Knowledge Center and participating in its learning programs and networking events. Reputation Institute has offices and associates in 30 countries around the world. For more information, http://www.reputationinstitute.com .
2013 Global CSR RepTrak® 100 Study Results