14 NEWSWEEK.COM DECEMBER 13, 2019
he jury is out on whether corporate social
responsibility programs will one day make the world
a better place. But this much is pretty clear: They’re
already benefiting the companies that have imple-
mented them. And in some unexpected ways.
Specifically, CSR has become the weapon of choice
for what is known as, in corporate speak, the three R’s: Investor
Relations, Human Resources, and Public Relations.
But before we dive into details, a CSR mini-lesson is in order.
First off, CSR isn’t an overnight sensation. Over the past couple
of decades, companies have been embracing the idea that they
need to do more than just make a profit for shareholders. Do-
good efforts slowly evolved from passive and limited corporate
philanthropy programs—giving to the United Way, for exam-
ple—to broader and more active CSR programs. Those would
take on major social issues like Goldman Sachs’ 10,000 Women
program, which in partnership with the International Finance
Corporation (World Bank) has delivered $1.45 billion in loans to
women-owned businesses in developing countries.
Now, they have evolved even more. Many companies are
now incorporating impact-on-society considerations into core
business activities. For example, Starbucks only uses “ethical-
ly-sourced coffee.” Programs like these are often focused on
“sustainability.” In August, 181 CEOs of the country’s largest cor-
porations signed a Business Roundtable statement committing
to managing their companies not just for shareholders, but also
for customers, employees, suppliers, and communities.
The idea behind all of these efforts is the well-worn slogan
“doing well by doing good,” which means that being a positive
force in the community will enhance a company’s reputation,
which in theory will pay off in more sales, lower costs and over
the long term, more money for shareholders.
Can you even measure something like this? Stephen Hahn-Grif-
fiths, chief reputation officer of the Reputation Institute in Boston,
says you can. He reels off a string of statistics, like “40% of the repu-
tation of a company is related to corporate responsibility” and says
his organization’s research proves that reputation is a leading indi-
cator of stock market capitalization, or the total value of a company’s
shares. In other words, he adds, “CSR has a multiplier effect” when it
comes to a company’s value. But CSR can be risky. And take a little guts.
According to analysts, CVS’s 2014 decision to stop selling tobac-
co products cost it $2 billion a year in sales and caused the stock
price to drop. (Investors took a $1.43 billion hit that year according
to Martin Anderson of UNC Greensboro.) In 2010, Campbell Soup
announced it was reducing the salt levels in many of its soups, a
decision they reversed the following year when sales fell by 32%.
Meanwhile, in 2018, Dick’s Sporting Goods stopped selling
assault rifles. On a panel at this year’s Aspen Ideas Festival, CEO
Ed Stack said that decision cost them customers and employees.GOOD FOR ALLDoing good should lead
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