Monday, May 13, 2013

How to Evaluate the Contribution of CSR or ESG Programs to Achieving Business Goals

I recently worked with a client who wanted to demonstrate a social-good program (SGP) the company was doing with schools makes a positive contribution to achieving the organization’s business goals.

How We Did It
My client’s product is only available to people who use the Internet. So, we drew a panel sample of 1,000 balanced to represent the US online public. Because we were concerned our sample would not include enough people aware of the specific SGP for in depth analysis, we decided to expose half to a concept statement describing the program. This enabled us to compare attitudes toward the company and likelihood to use the client’s products between those exposed and those not exposed to the concept.

The results showed: 

  • Non-product users exposed to the concept statement were significantly more likely than those not exposed to agree with every positive attitude statement describing the company.
  • Those who were not client product users and who were already aware of the SGP were significantly more likely to say they were likely to use the client product in the next three months than were those who were not aware of the SGP.
  • One of the client’s corporate goals is to increase usage of other services it offers. We found that current product users who are aware of the SGP are significantly more likely to report using the other services than are those who are not aware of the SGP.
  • Another corporate goal is simply to increase customer product use frequency, and we found that client product users who are aware of the SGP are substantially more likely to use the client’s product one or more days a week than are those unaware of the SGP. 

Relational vs. Causal
These results were all relational rather than causal. That is, while the results show a relationship between awareness of the SGP and achieving these business goals, they do not show that awareness of the SGP causes the achievement of any of these business goals. For example, it could be people are more likely to use the client’s products, because they are aware of the SGP. However, it also could be that they are aware of the SGP, because they are frequent users of the client’s products and services. My guess is that both are true.

Nevertheless, we see these as very positive results for the SGP.

Why is This Important?
The results suggest in this case that publicizing the SGP to current and potential customers could actually help the client to be perceived more positively and even to drive sales. At the very least, publicizing the SGP could help the client elaborate its brand in the minds of its customers and add to the brand's story.

Is This True for all ESG and CSR Programs?
We have no way of knowing whether other corporate social responsibility (CSR) or environmental, social and corporate governance (ESG) programs would show similar relational effects. But this methodology is one way to find out.

Please contact me if you'd like to learn more.

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