Every financial institution is faced with the reality that success in today’s marketplace requires new paradigms for growth and adding techniques to your sales and services portfolio. You, no doubt, have a handful of strategies in mind. But there might be a tool missing in your plan. That tool is a corporate social responsibility (CSR) platform.
Integrating a commitment to community investment and doing good into your business plan is more important than ever before. Trust in financial institutions, as a whole, continues to lag since 2008. According to a 2013 Edelman/New York Study, bad news sticks. This year marks the fifth anniversary of the financial crisis. Financial results have rebounded, but the turnaround in performance is not matched by consumer trust in financial institutions, which has dropped to only 50% among the informed public.
In the increasingly competitive financial services marketplace, credit unions have emerged as a bright spot within the industry, enjoying higher levels of customer loyalty from members who actually own a part of their institutions. Member loyalty, in turn, is fueled by community engagement and a proactive CSR platform. Indeed, credit unions are a model for how a financial institution can drive growth through community connections based on CSR.
The expectations of credit union members, much like all financial institution customers, have changed. The marketplace expects financial institutions to respect the communities in which they operate. Doing good and giving back is no longer a luxury. A well-developed corporate social responsibility program addresses those issues, and functions as a valuable corporate asset.
To that end, a proactive CSR platform should support your overall business model. Investing in local communities creates a cycle that creates positive business, social, and economic impact. It also provides a vivid illustration of “the credit union way’ — people helping people.
Key Trends In Corporate Social Responsibility
Forward-thinking companies understand that CSR and community investment efforts are not only about “doing good.” Rather, in today’s marketplace, well-organized, well-executed CSR activities are critical factors in driving business improvement, customer loyalty and employee retention.
Indeed, leadership in the context of social responsibility and ideals have been shown to drive corporate success. In his book, Grow, Jim Stengel reports on a 10-year study of 50,000 brands. According to the study, the 50 highest-performing brands are those driven by ideals. They grew three times faster than their competitors and outpaced the S&P 500 by more than 400%.
Increased scrutiny of the philanthropic sector — including increased regulation of charitable giving, tax laws, and charitable expenditures — contributes to the need for well-defined, well- executed CSR programs. Increasing regulation, including changes in the laws involving 501(c)(3) organizations, is impacting consumers’ and employees’ perceptions of corporate involvement with the nonprofit sector, making it increasingly important for companies to adopt clear, strong and effective programs.
Corporate Social Responsibility Statistics
Organizations are competing aggressively to attract and retain strong talent pools. The economy’s slow recovery has put strain on the bottom line. Companies need to make every new-hire count to ensure they maintain high-levels of quality service while maintaining operational efficiency. A well-executed CSR program can work as an effective tool to spur employee engagement. Consider:
88% of new job seekers choose employers based on strong corporate social responsibility values.
83% of consumers are willing to change their consumption habits based on their perception of a company’s CSR program.
86% of young employees would consider leaving if a company’s CSR values no longer met their expectations.
On average, 7% is of any employee base participates in corporate matching gifts programs.
Indeed, consumers and employees cast a wide net around the definition of what it means to be socially responsible, defining doing good as a combination of 10 activities (see below) that together create a socially responsible lifestyle.
Want More? Click here to read 6 Best Practices To Execute An Effective CSR Strategy; Is Financial Education For Young Adults A Community Imperative?; The Internal Benefits Of A CSR Strategy
About The Author
Brandon Michaels leads the awesome group of Mazumans at $490 million Mazuma Credit Union in Kansas City. He took the reins at the ripe-old age of 31 and looks forward to changing the credit union industry. Prior to serving as the President & CEO, he served as the chief financial officer for two years. Brandon moved to Kansas City from the California Bay Area, where he was the vice president of finance/chief financial officer at San Francisco Fire Credit Union.
Brandon is a third generation credit union CEO. Although Brandon grew up in the credit union movement, he worked three years for the Federal Deposit Insurance Corporation as a bank examiner before making his formal entrance into the industry ... an industry he thought as a child, “you couldn’t pay me enough to work in this place!”
Brandon was recently recognized by the Credit Union Times as a Trailblazer 40-Below, a recognition awarded to credit union executives who are working at warp-speed to better the future of the credit union industry. Brandon is also a private pilot, an awesome dad to Charlotte and Kason, and a loving husband to his beautiful wife Kathi.