August 26th, 2010

Measuring the Value of CSR Communications

by Perry Goldschein

Many mid-size and larger companies are investing increasing levels of both human and financial resources in corporate social responsibility (CSR) / sustainability efforts, despite a struggling economy. Yet, especially in this economy, for a CSR program to be sustainable, it’s important to develop, maintain and tie CSR goals to overarching corporate goals. This usually requires some type of meaningful measurement and reporting, best set up at the beginning of the process.

So it’s not surprising that plenty has been written about metrics and benchmarks (including articles and posts in BSR publications, Environmental Leader, and Fast Company) that can be used to help determine how sustainably organizations operate, how sustainable their products are, and how much such efforts impact them financially, among other things.  These tools are used to help companies determine to what extent they are reaching their CSR and corporate goals, and how they compare to their peers in material and relevant categories.

There has not been much written, however, about what and how best to measure an organizations’ efforts to communicate about their CSR activities, or how successful such communications are. In other words, there is little or no consistent discussion or consensus around metrics specific to communicating CSR, as opposed to practicing it.

Yet, approximately 80% of consumers had no idea that sustainability leaders (e.g., HP, Intel, Cisco, Unilever) were participating in any sustainability practices at all, according to a September 2009 Grail Research report. Clearly, there’s a need to better measure and improve upon CSR communications performance.

Some CSR Communications Metrics

In working with clients on this topic, we have come up with a universe of potentially relevant CSR communications metrics, a few of which we summarize here as examples, followed by recommendations on best practices:

• Visibility & Awareness:
  • Various CSR-related media impressions and website visits
  • Awards, indices or related recognition and size of audience reached (e.g., DJ Sustainability Indexes and CR Magazine’s Top 100 Corporate Citizens list)

• Reputation:
  • Survey and/or focus group data designed to measure components of the organization’s reputation related to CSR
  • Social media comments related to the organization’s CSR activities, or lack thereof (qualitative)

• Employee Effects/Outcomes:
  • Employee recruiting – measuring percentage and extent to which CSR issues factored into decision making
  • Employee engagement/retention

The metrics identified under the visibility and reputation categories, above, measure potential effects across different types of stakeholders. In addition to employee-specific metrics, you can also gather customer- and other stakeholder-specific engagement metrics using similar tools, such as interactive campaign tracking results, social media monitoring, surveys and/or focus groups.

Challenges include the availability and/or cost of obtaining data and the difficulty in isolating results from other initiatives and activities of the company that may affect such things as brand loyalty or engaged employees.  Survey questions must be well-tailored and analysis carefully done to isolate how sustainability affects loyalty, or actual consumer behavior.

Best Practices in Measuring CSR Communications

• Ideally, measure and report the outcomes you want to achieve, not just the activities you believe will achieve them. So, for example, don’t just measure how many customers know about your CSR efforts – measure and report how much brand loyalty or reputation has increased and why.

• Convey sustainability communications value using both facts and real examples of impact, since people often remember stories more easily than raw facts. Use a story around two or three solid metrics.

• Avoid overly-complicated metrics plans and dashboards or reports that confuse more than they inform or inspire – you can always put additional and/or supporting data in your “back pocket.”

All in all, it is apparent that many companies are pushing CSR to new levels, but there aren’t enough tools to help them communicate their CSR successfully. SDialogue is working to further develop CSR communications metrics – keep an eye out for our upcoming sustainability communications scorecard on healthcare and CPG companies.