In the past three years I have participated in competitive sales speaking, and through listening to other participants, I have observed one thing they all have in common: every sales speech, although selling a product, has a section on how the company gives back.
Over the last decade, corporate social responsibility has become a prominent part of our society, with a growing number of businesses participating in sustainable and responsible business practices as well as making positive connections with their communities through charitable giving and volunteering. The impact of this is prodigious. People, including my fellow sales speakers, now consider more than just what a product is, but also what a company is doing. This growing awareness of many Millennials is causing companies to reconsider corporate social responsibility, changing the way the corporate world thinks about recruitment, retention and their communities. Starting in the early 1990’s, we can see an increase in public awareness and passion about corporate social responsibility from the backlash of Nike’s sweatshop crisis in 1990, to BP’s oil spill in 2010. The Millennial generation is more aware of their global impact. Although often portrayed as the most self-centered generation, statistics, as well as my competitors speeches, show that Millennials may in fact be the most altruistic generation, motivated by giving back to communities in need. 73% of surveyed Millennials said they would be willing to spend more money on a sustainable product, additionally 81% of Millennials expect companies to make their corporate citizenship public.
These are powerful numbers considering Millennials are the majority of the workforce recently surpassing Gen Xers as the largest age group of American workers. It is predicted that by 2020, Millennials will be nearly half of the American workforce (Hayzlett). Meaning that if businesses wish to recruit new workers, they must listen to what the younger generation demands: more corporate social responsibility. As technology progresses and the need for more workers increases, recruitment becomes a serious issue, and Millenials are looking for more than just a paycheck from their job.
Nearly 60 percent of Millennials are purposefully searching for employers whose sense of social responsibility matches their own, and 51 percent will not work for a company that does not have strong sense of social responsibility (Company Social Responsibility).Some companies have taken these statistics seriously and reconstructed their companies to embrace corporate social responsibility, for example the fast food industry is changing the way it recruits new employees. The job market for fast food workers is becoming highly competitive due to the lack of teenagers joining the workforce. In the past decade, teen summer employment has slowly trailed off with many teens opting for unpaid internships, volunteer opportunities, or pre-college programs. This demonstrates that teens are seemingly more interested in making a difference than making money (Griswold).
Businesses like McDonalds have decided to try a new approach to hiring teens, corporate social responsibility. In 2016, McDonald’s announced that it would be switching its primary sources of beef to sustainable options, while testing new ways to let cattle graze “that can actually lead to net-negative carbon impact.” They also promised to eliminate deforestation, the clearing of trees for their cattle, from their supply chains by 2020. This statement came soon after their 2015 promise to switch to cage-free eggs, followed shortly by other fast food incorporations such as Subway and Wendy’s (Filloon).
These efforts are clearly an attempt to lure in Millennial customers through their goodwill, as well as recruit new employees. McDonald’s latest stab at corporate social responsibility is making a promise to drop all foam packaging from their stores by 2019 and switch to packaging made from completely recycled materials by 2020 (Garfield). These changes are a response to the dying fast food industry, demonstrated by the flatlining of sales since 1999 (Garfield 2). McDonald’s realized that creating a more environmentally sustainable company would attract more workers, with 80% of 13-25 year olds wishing to work for a company that cares about how it impacts the environment and contributes to society (Peretz).Not only is corporate social responsibility critical for recruiting skilled employees, but it also plays a key role in engaging current employees. Over 50% of Millennial employees said that volunteering with their company increase their loyalty and confidence in their company.
In a Skills Based Volunteer program—where volunteers put their professional skill to use to aid a nonprofit or other organization—reported that employees who participated are 142% more likely to report job-related skills gains than traditional volunteers. Seventh Generation is an all natural cleaning company putting this to the test. They offer paid time off for employees who volunteer, as well as having company wide events to raise money for the nonprofit Spectrum Youth and Family Services.
Each employee is asked to spend 1% of their time, or approximately 20 hours, volunteering each year (Foundation). Companies like Seventh Generation, who encourage volunteering, and other social responsibilities, often have a lower turnover rate of employees. The average US company has a turnover rate of 15.1%, although some of this is healthy for a company- getting rid of less motivated or skilled workers- it can also cost the company upwards of $15,000 per employee. On the other hand employees committed to their organization are 87% less likely to resign. (Charities.org) Volunteer work has been proven to increase an employee’s commitment to a company by building relationships, challenging workers in new ways, and giving meaning to their work. Although Corporate Social Responsibility is centered around reaching out into the community, it also includes reaching into their company and providing the best possible working environment.
Recent research shows that happy workers are nearly 12% more productive than unhappy workers, and are more likely to remain at their current jobs. Patagonia is a prime example of a company with not only outward Social Responsibility but also inward consciousness. Patagonia is one of the few companies that offer onsite childcare, and allow parents to visit children during the day. The company also offers after-school busing allowing parents to connect with their children. Due to these practices Patagonia has a 100% retention rate of mothers compared to the national average of only 75%. (Slate) Although the daycare costs around $1 million to run, company president Ridgeway estimates that they get ” (A) little over 90% back in quantifiable returns,” because when a company treats their workers right they are more likely to be happier, work harder, and stay with the same organization for longer. Another benefit of Corporate Social Responsibility is the immense impact that an organization can have on their communities. Community is defined as ” a unified body of individuals,” (merriam webster) based off of that definition of the word community implies coming together and unity.
When an organization engages with their community, it not only creates benefits for the company but also fosters growth in their society. After a business decides to give back to their community and incorporate Corporate Social Responsibility into their agenda, it begins a mutualistic relationship, where both the company and community benefit. 90% percent of customers would switch to a brand that supports a worthy cause (huffington post), meaning that when organizations give to their communities it often comes back around in the way consumers spend their money. The city of Grand Rapids is a example of how Corporate Social Responsibility can transform a community. According to the Grand Rapids Business Journal, Grand Rapids is considered one of the best cities for Corporate Social Responsibility, topped only by Portland Oregon.
This ranking may be based off of the fact that Grand Rapids is ranked number five in LEED certified buildings per capita or the growing number of small, local businesses. Another unique factor playing into the Grand Rapids Community is the Medical Mile, a stretch of downtown Grand Rapids with clinical, research and academic facilities. The medical mile was started by philanthropists Jay and Betty Van Andel who have also donated significant amounts of money to other aspects of the community. Today Grand Rapids is one of the lead areas in cancer research and other medically related fields. (Gr website) Because the Van Andel’s have invested in their community and spend a large amount of their wealth giving back, it is no surprise that Grand Rapids was voted one of the top economic comebacks after the 2008 recession.
The correlation between these two is not certain, but with companies that are motivated towards bettering the communities around them and give their employees incentive to work, it is no wonder the city has managed to bounce back. By 2012 Grand Rapids was named the best city to raise a family and by 2013 Grand Rapids was voted number four in best cities to find a job. (Forbes)As my fellow sales speakers showed me, the generation entering the workforce has a passion for changing the world in simple ways, and as companies are looking into how to cater to this new generation they may have to look outside of their own company. Corporate Social Responsibility is the way of the future and if organizations wish to be part of this future they must change the way they think about recruitment of employees, retention of their workers, and interacting with their communities.