Your reputation is the reflection of your brand’s promise in the perceptions of stakeholders. Anyone who’s even vaguely keeping tabs on corporate communications knows that Corporate Social Responsibility (CSR) is increasingly a key ingredient to reaching stakeholders. For companies like Tom’s and Warby Parker, it’s at the very core of their business model. And as CSR becomes closer to the core of even more businesses, we honed in on a trend we describe as Actual CSR versus Perceived CSR. In other words, what are you actually doing for the greater good and what is the perception of those actions by important stakeholders?
At Reputation Institute, we group three of our seven RepTrak® dimensions into a special subgroup for CSR: Citizenship, Governance and Workplace. Therefore, a company’s CSR RepTrak® score reflects if a company is considered a good corporate citizen, responsibly-run and an appealing place to work. These three dimensions account for over 40% of overall RepTrak® score and in a recently published research brief, we examined the top 30 largest Dutch companies through this CSR lens. What we found is that even though CSR is increasingly important to reputation, the CSR dimensions are frequently where companies receive the lowest scores. So what’s the deal?
Actual versus perceived CSR: Closing the gap
The gap between an organization’s actual and perceived CSR can spell out opportunity or risk. If an organization is more sustainable than the score reflected, there is an opportunity to bring that perception more in line with reality. In other words, you’re doing things that may be viewed favorably by stakeholders but you’re not communicating these good works effectively.
Conversely, if an organization is less sustainable than perceived, they risk negative results once people realize their perception does not match reality. These organizations need to back up these positive perceptions by putting real CSR programs in place.
Regardless of the size and nature of the gap, CSR misalignment is something that organizations will need to address as stakeholders place increasing importance in this area.
What I found particularly striking in the results was that the Dutch public often does not recognize the actual CSR efforts of a company. For example, ING, one of the largest and most well-known company in the Netherlands, is less recognized for its CSR efforts than the other four Dutch companies in the Corporate Knights’ 2017 Global 100 ranking. Yet, ING is actually the number one most sustainable Dutch corporation and is even positioned in the top 5 globally. Therefore, for companies like ING, there is a valuable opportunity to improve reputation by actively communicating its CSR commitment and practices.
~Dagmar Verheij, Research Analyst, RI Netherlands
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