Companies align social impact with strategy for long-term success

After years of reacting and responding to crises and stakeholder expectations, companies increasingly are tying their corporate social responsibility strategies to their core values and sharpening their focus on generating positive return on investment for their businesses and communities.

“Between widespread polarization and rapid technological developments, there’s no shortage of division and uncertainty right now,” said Sona Khosla, chief impact officer for Benevity. “To weather this sea of change, executives will be revisiting their corporate strategies and embracing an enterprise-wide ‘impact mindset’ to embed positive social and environmental impact across their culture, brand and operations.”

Benevity, a global provider of social impact software, recently released its annual State of Corporate Purpose report. The key findings include:

• Employee resource groups are now business-critical. Eight in 10 companies say ERGs are being consulted more often by departments such as HR, communications and marketing. They bring perspectives on the needs of diverse communities, add authenticity to crisis responses and influence social impact strategies, funding and decision making.
• Volunteer programs propel culture forward. Volunteering has gained momentum as a critical tool to build culture and employee engagement in the now-normal hybrid work world. Nearly 60% of volunteers were new in the past year, a direct result of companies investing in volunteering to build (or rebuild) their culture.
• Companies cautiously use their voice. Business leaders are becoming more experienced in learning when and how to engage in potentially divisive social issues in a way that is resonant, impactful and aligned with their corporate goals and values.
• AI is being used for good. Companies are striving to harness AI’s power in ways that address social issues while mitigating a potential divide. Although 6 in 10 companies are concerned about the potential impact of AI, 87% are optimistic about what it can do for philanthropy.
• Outcomes-driven philanthropy is advancing. The greatest increase in corporate social responsibility budgets this year will be in data, measurement and reporting. Companies that have proof that their social investments are driving both business value and social outcomes will sustain budgets and leadership in the long run.
• ESG continues to evolve. Companies are increasing environmental investments through their philanthropic programs. All indications point to growing regulatory, shareholder and stakeholder pressures that will have companies measuring and managing the totality of their environmental and social initiatives.

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“The early 2020s were marked by companies highly focused on responding to crises, which shifted budgets and approaches to granting,” Khosla said. “While businesses are now taking a more strategic and forward-looking approach, it’s inspiring to see so many businesses embedding a crisis and DEI lens into the full range of their granting programs, resulting in greater equity and resiliency over time.”