News release
Good CSR makes good business sense
August20,2014
A survey of 2,500 businesses in 34 economies finds that businesses are being driven towards more socially and environmentally sustainable practices not simply by brand building or altruism, but because it makes good financial sense. The research, from Grant Thornton’s International Business Report (IBR) also shows that an increasing number of companies report on sustainability while a majority now view integrated reporting as best practice.
Cost management becomes top driver towards more sustainable business practices
The IBR reveals that the top driver towards more sustainable business practices globally is cost management, cited by two thirds of respondents (67%), up from 56% in 2011. The second biggest driver is client/consumer demand (64%), followed by 'because it is the right thing to do' (62%).
Francesca Lagerberg, global leader for tax services at Grant Thornton, commented: “The findings suggest that benefits of adopting more environmentally and socially sustainable business practices are becoming ever more tangible, for example through tax relief on charitable activity or lower energy bills due to efficiency measures introduced.
“Strong social and environmental credentials can also create customer loyalty and enhance reputations, which has become increasingly important with the rise of social media. We live in an increasingly digital world characterised by instant customer feedback, so businesses need to be mindful not just of what they are doing, but of how they are doing it. Companies which gain while the local population or environment loses can quickly find demand for their products or services eroding."
Perception also emerges as the key drivers in China. 63% of Chinese business leaders cite either the recruitment/retention of staff or brand building, both slightly above the global average. These findings echo research we conducted in China last year, The Thoughts of Chairmen Now, which noted that businesses leaders recognisethe challenges of operating under the auspices of ‘Brand China’ and are focused on building trust and loyalty in their goods and services. Government pressure also remains a big driver in China with more than half of businesses citing it as important (52%), compared to 37% of all businesses. High levels of air pollution in major cities such as Beijing have prompted a strong response from the ruling party with Prime Minister Li recently declaring “war” on pollution.
Donating to community causes/charities is the number one CSR initiative
According to the IBR, the number one CSR initiative implemented globally over the last 12 months is donating to community causes/charities, cited by 68% of business leaders. Two thirds (65%) said they had participated in community/charity activities, while 65% also said they had improved their energy efficiency or waste management.
According to the research from Grant Thornton, at present just under one third (31%) of firms globally report on sustainability initiatives, either combined with financial reports or separately. However, a further quarter (26%) plans to begin reporting externally on sustainability matters in the next five years. And overall, 57% agree that reporting on non-financial matters, such as sustainability, should be combined with financial reporting.
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About the International Business Report
The Grant Thornton International Business Report (IBR) provides insight into the views and expectations of over 12,500 businesses per year across 45 economies. This unique survey draws upon 22 years of trend data for most European participants and 12 years for many non-European economies. Hundreds of businesses were surveyed in mainland China (around one third businesses are state owned and public sector, one third privately owned and one third foreign funded). For more information, please visit:
About Grant Thornton China
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