CSR, or Corporate Social Responsibility, is a unique program from the company as a form of responsibility in society. Many aspects are used to measure the success of CSR, one of which is the SROI method.
There are many variations of CSR, which depend on the type of company and its impact on society. This article will explain the various benefits of CSR as well as measure the success of CSR with specific methods.
4 Benefits of Corporate CSR
One of the opinions of various experts regarding CSR is a corporate social activity that is evidence of the company’s responsibility. One accountable aspect is attention to increasing profits, society, and the surrounding community.
Understanding CSR and its application is clearer when discussing its various benefits. The following are 4 benefits of corporate CSR both for the company and the community itself:
1. Improving Corporate Image
The main benefit of the company’s CSR is to improve the image of the company itself. A company’s most important idea is indeed from its product, but with this CSR, the company can certainly attract the wider community’s attention.
For example, image enhancement due to CSR can increase people’s loyalty to a particular company’s product. Therefore, if the company does not carry out the CSR program, imagine the response of the surrounding community to the company.
2. Creating a Good Social Environment
Creating a good social environment is the second benefit of CSR, in which the level of success will be discussed and measured later using the SROI method. It should be noted that mutualism between the company and the community needs to be mutual.
This mutualism will create an excellent social environment and influence a company’s business success in the long run. The reason is there are not a few companies that the surrounding community must protest because they do not have a positive impact.
3. Reducing Business Risk
The third benefit of CSR is reducing business risk. If the company cannot meet the expectations of various stakeholders, there will certainly be a risk of threatening the cooperation of multiple stakeholders. Therefore, the company should carry out CSR.
Companies must allocate costs or budgets to carry out CSR and fulfill the expectations of many parties because the cost of doing CSR is lower than the cost of having to bear losses due to business risk.
4. Improved Access to Resources
Finally, CSR can increase access to resources to fulfill a company’s production. If the company carries out CSR, the opportunity to find new beneficial resources for increasing the company’s show will be even higher.
For example, companies can recruit competent and the best human resources to join the company. Of course, this will improve the quality and sustainability of the company in the long run.
How to Measure CSR Success with SROI
If CSR is understood, the next thing that needs to be known is Social Return on Investment. This one method is a framework that aims to measure and consider the concepts and values of CSR itself.
This social return method is not necessarily about money but the value a CSR company embodies. Therefore, how to measure the success of CSR with this study can be done with 2 types of SROI, namely:
1. Evaluative Measurement Types
How to measure the success of CSR with evaluative measurements is based on actual results and data collected over a certain period. In practice, companies usually carry out CSR for a period of 1 year. Then, the measure of CSR success is evaluated after completion.
2. Types of Forecast Measurement
Second, companies can make estimates or forecast measurements. The goal is to predict how much social value will be realized. Usually, companies make forecasts or forecasts within the next 1-5 years.
These are the 7 Principles of Social Return on Investment!
Companies that have carried out CSR measure their success with the social return method. Furthermore, what must be understood is the SROI principles. Here are 7 principles that must be understood by a company when it wants to do CSR:
1. Involve Stakeholders
The first principle is to involve stakeholders around the company. That is, the company is obliged to inform the party responsible for the program’s interests. For example, knowing what objects can be measured into a value.
In addition, knowledge and information about changes that occur are converted into rupiah. Involving these stakeholders can be a vital key to the creation of a successful and long-term CSR.
2. Understand What Changes
The second is understanding the changes that exist and not just taking them for granted. These changes can be evaluated by the company so that they can become capital for more successful CSR programs, the benefits of which are felt by stakeholders.
3. Appreciate the Value of the Things that Matter
This means that a company’s CSR must have a clear financial proxy principle. This is related to increased wages, increased production, and cost savings. Using the SROI method can help companies pay attention to these aspects.
4.Only Include What in Material
Companies must demonstrate and have the principle that when CSR is promoted, there must be evidence of positive changes and impacts. Even better if the company is able to demonstrate a measurable effect.
5. Do Not Overclaim
Successful CSR is making the company have the best image in the eyes of society, one of which is not overclaiming. All CSR activities must be accountable and pay attention to the various considerations and contributions of multiple parties.
The next principle is transparency, which means that CSR formed by a company is required to show the basis for change. In addition, it is also obligated to calculate the impact honestly and credibly. If the company is transparent, then the image in the eyes of the public and stakeholders will be better.
7. Always Verify the Result
The final principle is always to verify which results are by providing assurance about corporate responsibility. This responsibility can be in the form of conducting Social Return on Investment studies whose aim is to eliminate subjectivity.
CSR activities are very very useful and beneficial for the company and the community in the surrounding environment. The aspect that can measure the success of a company’s CSR is the Social Return on Investment which has various positive principles.
In its application, companies that want to do CSR can use trusted agency services such as SUCOFINDO. The best facilities have been owned so that the company’s CSR process can be right on target. Apart from facilities consulting, SUCOFINDO also has other services that are no less important.
This service is an SROI that can help companies measure the success of their CSR activities. Assisted by various experts, companies do not need to worry about the impact of CSR on society.