CSR begins with the real Living Wage12.11.19
Chief People Officer
With the rise of ethical consumerism and awareness surrounding the climate crisis, the vast majority of companies are now investing – and vocalising that investment – in corporate social responsibility (CSR). With a quick Google, it’s easy to find organisations from all sectors talking about their new CSR policies or a variant of that, ranging from a ‘we recycle’ disclaimer to an ‘ethical practice’ section on the company website. In October, supermarket Waitrose announced plans to remove plastic from their products and trial refillable packaging, Twitter revealed changes to policy which would block misleading political adverts, and British Airways promised to offset all domestic flight emissions in 2020. But what does this all mean for the employees who work for them?
CSR as you know it
There are broadly three types of CSR:
- Environmental: Focussing on reducing organisational impact on the environment, e.g. reducing waste, emissions and carbon footprint where possible, and finding green alternatives.
- Philanthropic: The most widespread and longstanding form of CSR, such as donating money to charities, volunteering and giving back to the local community.
- Ethical: Initiatives that place ethics above profit, including fair trade resources, cruelty-free standards, anti-child labour etc.
While sponsoring charities is the most common form of CSR among businesses, environmental CSR is increasing in popularity, given the increase in climate change awareness. Retailer Lush are a prime example of ethical CSR; famous for their ethically-made products, their marketing and company culture heavily focusses on this element of their business. But ethical CSR isn’t limited to factory workers and production lines: to truly resonate with customers, whether they’re buying a t-shirt or SaaS, your CSR needs to begin at home – within the company itself.
Social responsibility starts with you
When considering CSR positioning, employers must consider where their own employees come into their policies. Employees should be the first place you look to for social responsibility. What are working conditions like? Do you offer flexible working where possible? Do employees receive a real living wage for their work?
From the shop floor, to the chief exec’s office, to the factory or farm, fair pay for all stakeholders is a major element of CSR. In fact, equal pay for work is a key target to achieve by 2030 within the Sustainable Development Goals (SDGs) – a series of goals set out by the United Nations targeting a more equal, sustainable, and prosperous planet. SDG 8 states the goal of “equal pay for work of equal value”, and SDG 10 proposes “achieving and sustaining income growth of the population”.
So, while giving outwardly is absolutely to be commended, organisations must also reflect this social responsibility inwards. External CSR policies need to be replicated with internal action, otherwise they will lack authenticity and inevitably unravel.
“Employees will buy into a company based on its values and culture, and so will customers. Both customers and employees can fact-check anything in a few seconds with sites like TripAdvisor, Glassdoor and Amazon. A cursory search on the internet will reveal the numerous controversies that even the world’s most powerful companies aren’t immune to – social media giant Facebook saw their stock plummet by 25% in 2018 after a year of data scandals. In 2017, Sports Direct’s pre-tax profit fell by 58% after the reveal of poor working conditions.
Your employees are your biggest customers. And your customers are your biggest stakeholders. And just as stakeholders will pull out after a controversy, so will your customers. Just as companies have fallen prey to reputation disintegration and social irresponsibility, others have benefitted from their good deeds and gained social traction, loyalty and profit from their ethical decisions.” Read more in the full report, The benefits of sustainability in business.
The real living wage
One way to enact internal CSR is through paying the real living wage. The real living wage is a proposed rate of pay independently-calculated by the Living Wage Foundation. As opposed to the Government’s mandatory living wage, the real living wage is voluntary for employers, and covers the actual cost of running a household (including all goods and services).
In 2016, Benefex became an accredited real living wage employer, and have since continued to expand our external CSR offering, focussing on giving back to the local community and supporting a variety of charities. To truly deliver on a CSR strategy, it is key to prioritise your people, ensuring their fair pay and treatment, before considering external CSR responsibilities.
While some smaller companies or start-ups may be unable to afford to pay the real living wage at first, many businesses who do not pay the real living wage still support external charities or other CSR practices. For example, an employer may outwardly support local charities or employ sustainability initiatives, but internally refuse to pay the real living wage.
In situations like this, employers need to question why they are prioritising external CSR over their employees. Is this because they think those causes are more deserving than fair pay for employees, or is it is because they think it looks better to an outside market? Can a company truly be socially responsible if they neglect to fairly pay staff?
Arguably, if there is money to be spent on improving a company’s CSR, then this needs to encompass consideration for both internal and external parties. Deciding where to focus this budget is an undeniable challenge, but the argument for focusing at least the initial investment on your people is a strong one. Paying the real living wage, as calculated by the Living Wage Foundation, is proven to increase motivation, brand-promotion and loyalty. In turn, this will pay back through lower turnover, and higher productivity and ROI, allowing you to invest even more in CSR – both internal and external.
Whatever your business budget for CSR, the real living wage is a business priority that cannot be overlooked. Whether you want to increase employee motivation, attract new talent, or simply support your CSR claims, the best social responsibility starts from within.
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Kathryn joined Benefex in October 2014 and has overall responsibility for managing the HR function within Benefex. She has over ten years’ experience of HR management across a variety of sectors. During this time, she has not only managed HR teams but has also had responsibility for operational departments, meaning she has a great understanding of what it actually takes to get a business delivering.
Kathryn’s remit at Benefex covers a wide spectrum, from developing a recruitment strategy to bring in the very best people to deliver to our clients, to designing and delivering in house training solutions, to ensuring our company values are at the heart of everything we do. She is passionate about ensuring work becomes a great place to be for absolutely everyone, and believes that life is far too short for us to spend it dreading Monday mornings. As she’s super multi-talented, she also runs her own HR blog, Up Close and Personnel.
Kathryn’s claim to fame is that she is so bad at parking, she once drove her car into the side of her old office. We’re hoping she doesn’t go for a repeat performance here!