Learning, Practice, Results. In Good Company
Weathering the storm
The State of Corporate Citizenship in the United States 2009
Boston College Center for Corporate Citizenship
About the survey
The 2009 State of Corporate Citizenship in the United States is
the fourth biennial survey of the attitudes and actions of senior
executives in small, medium and large businesses regarding corporate
citizenship. The previous three surveys, conducted in 2003, 2005
and 2007, found that executives view corporate citizenship as a
fundamental part of doing business but often allow aspirations to
outpace actions.
The 2009 survey explores in greater depth the challenges of integrating
corporate citizenship into core business practices and how tough
economic times have impacted these practices. For the first time we
also explore how executives view new public policy challenges and
their reaction to public expectations for better regulation of business.
We thank The Hitachi Foundation for its generous support of this
fourth biennial State of Corporate Citizenship survey and to the
business executives and contributors who made this report possible.
Chris Pinney
Director, Research and Policy
Boston College Center for Corporate Citizenship
Social Reporting case studies
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Table of contents
2
4
5
7
Foreword
Key highlights
Survey methodology and goals
Context for corporate citizenship in the United States
The State of Corporate Citizenship 2009
9 Weathering the economic storm
11 Attitudes of executives
21 Actions
38 Citizenship gap between large and small companies
42 The future of corporate citizenship
44 References
Research Team
Boston College Center for
Corporate Citizenship
Lead Researcher:
VeselaVeleva,Sc.D.
Principal Investigator:
BradleyGoogins,Ph.D.
Contributors:
ReneCarapinha
PeggyConnolly
PhilipMirvis,Ph.D.
ChristopherPinney
RyanRaffaelli
Production staff:
AllisonLee
SharonSabin
TimWilson
The Hitachi Foundation
BarbaraDyer
MarkPopovich
www.BCCorporateCitizenship.org
© Copyright 2009 Boston College Center for Corporate Citizenship. All rights
reserved. This publication was prepared by Boston College Center for Corporate
Citizenship and may not be reprinted without permission of the research team.
State of Corporate Citizenship 2009
1
Boston College Center for Corporate Citizenship
Foreword
To quote Thomas Paine, “These are the times that try men’s souls.” Hard times make for
hard choices. And choices made and actions taken in the tough times are the true gauge
of the depth and durability of our values. We see reason for cautious optimism based on
the attitudes, actions and investment decisions emerging from the sample of business
leaders responding to this survey.
The context for the 2009 State of Corporate Citizenship survey could hardly be more
dramatic and challenging. The economic shocks of the past two years are the strongest
since the Great Depression. The consequences are the centerpiece of daily headlines.
The economy skidded from robust growth to a hair-raising decline. Jobs vanished as
unemployment soared. Both real estate and stock markets plummeted. Another cycle of
egregious wrongdoing and corporate misdeeds emerged.
The toll of these trends on businesses pushed some to their demise, and left many
others gasping for survival. People and communities continue to suffer greatly as many
are losing hope of recovery. The effects of these forces on businesses are also amply
documented by the survey. Most suffered large drops in sales or revenues and many were
forced to cut jobs, hours, pay and benefits.
The hopeful message in our data is that, despite the extreme turbulence, most businesses
are committed to being good corporate citizens. In fact, over half of these business
leaders believe that corporate citizenship is even more important in a recession.
Increasingly, companies are aiming to integrate corporate citizenship with their business
strategy. And these executives identified a number of new business opportunities they are
pursuing that are fundamental to good corporate citizenship.
Further, more companies are aligning their actions and investments with good corporate
citizenship principles. For example, just over 80 percent believe valuing and treating
employees well is an important or very important part of their business’ role in society.
And more companies, despite the economy and their own constrained budgets, are
supporting their employees in important ways. More than half are boosting the skill
2
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
development, education and career advancement of workers earning less than $40,000
per year. Just under half are providing frontline employees with business training to
broaden and improve their skills. Six of ten support work/life balance for all employees
– up from 46 percent in 2007. And the percentage of companies offering training and
development for lower-wage employees actually rose in the past two years – despite the
recession-induced slip from a tight to a slack labor market.
Why have corporate citizenship efforts been maintained and in key cases advanced in
these difficult times? More businesses’ leaders recognize that being a good corporate
citizen adds real value to their firm. Particularly when times are desperate, attention is
focused like a laser on those matters that contribute value to their bottom line. Most
businesses maintained and some others expanded their attention to, and budget for,
corporate citizenship. These actions are the strongest evidence that corporate citizenship
has met the value-added test for a large and growing segment of U.S. businesses.
As we’ve been flooded by announcements of business cutbacks and misconduct over
these past months, trust in business dropped. Many members of the public have
undoubtedly mused that some corporations should have their citizenship curtailed or
revoked. This survey shows that business leaders understand that corporate citizenship
in our country entails great responsibilities as well as extensive rights. Most are
diligently working and investing toward improving their efforts to more fully meet these
responsibilities.
This report offers hope that corporate America is deciding that applying for full corporate
citizenship delivers significant value to their business as well. It is a series of encouraging
signs in the midst of a great economic upheaval.
President and CEO
The Hitachi Foundation
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
3
Boston College Center for Corporate Citizenship
Key highlights
Continued commitment to corporate
citizenship despite the recession
Citizenship gap grows between large
and small U.S. companies
• Some54percentofU.S.seniorexecutives
believecorporatecitizenshipisevenmore
importantinarecession.
• Companiesin2009increasedinternaland
externalcommunicationaboutcorporate
citizenship,with54percentnowcommunicatingwithemployeesaboutitand39
percenttalkingwithstakeholders.
• Thetopthreeareasofcorporatecitizenshipratedmostimportantcontinuetobe:
operatingwithethicalbusinesspractices
(91percent),treatingemployeeswell(81
percent)andmanagingandreportingcompanyfinancesaccurately(76percent).
• Despitethetougheconomy,only38
percentofcompaniessaidtheyreduced
theirphilanthropyandgiving.Support
foremployeevolunteeringalsoremained
strongwith83percentoflargecompanies
statingtheircompaniessupportemployee
volunteeringinthecommunity.
• Companiesincreasedemployeesupportin
theirworkplacewith60percentbacking
work/lifebalancepracticesforallemployees,comparedto46percentin2007.
• Mostcompanies(51percentoverall,69
percentoflarge)supportskilldevelopment,educationandcareeradvancement
ofworkersearninglessthan$40,000.
• Whilemanylargecompaniesdealtwiththe
recessionwithlayoffs,theymoreorless
keptontrackwithcorporatecitizenship
activitiesas81percentcallitapriority.
• Smallfirmsstayedcommittedtotheir
corporatecitizenshippriorityoftreating
employeeswellbyminimizinglayoffs,but
significantlydecreasedemphasisonother
aspectsofcitizenship.
A new role for business in public policy
• MostU.S.seniorexecutivesbelievebusinessshouldbemoreinvolvedthanitis
todayinaddressingmajorpublicpolicyissuesincludinghealthcare,productsafety,
publiceducationandclimatechange.
4
State of Corporate Citizenship 2009
Increased appreciation of the business
value of corporate citizenship
• ReputationisidentifiedastheNo.1driver
ofcorporatecitizenshipby70percentof
executives(82percentfromlarge
companies).
• TheCEOnowleadsthecorporatecitizenshipagendainthreeoutoffourcompanies.
Environmental sustainability efforts grow
• Sustainabilityisnowseenasamajorbusinessdriverwith52percent(65percentof
largecompanies)designingandoffering
sustainableproductsorservices.
• Some72percentofAmericancompanies
(85percentoflarge)arereducingcosts
throughimprovedmaterialsefficiency.
• In45percentofcompanies,employees
werecompensatedforideasbenefittingthe
bottomlineandtheenvironmentorcommunity,comparedto37percentin2007.
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Survey methodology and goals
Survey methodology
Thefindingsinthisreportarebasedonresultsfromanationallyrepresentativesample
of756small,medium,andlargecompanies
acrosstheUnitedStateswhocompletedan
onlinesurveybetweenJune4andJune23,
2009.ThesurveywasconductedbyGlobe
Scan,aprofessionalpollingfirmbasedin
Toronto.
Toqualifyforcompletingthesurvey,respondentshadtomeetthefollowingtwocriteria:
• Befamiliarwiththeircompany’scorporate
citizenshipactivities
• Beatvicepresidentlevelorupforsmall/
mediumfirms,anddirectorlevelorupfor
largefirms.
Who are the respondents?
A total of 756 executives participated in
this nationally representative survey:
•
•
•
•
55% were CEOs/presidents
29% were vice presidents
11% were directors
5% were senior executives
Ages:
16%
No answer
10%
25-34
5%
Over 65
23%
55-64
www.BCCorporateCitizenship.org
20%
35-44
ToensurearepresentativesampleofU.S.
companies,samplecontrolquotasweresetin
advanceofthefieldworkbyregionwherethe
companyheadquartersislocated,sizeofcompany(bynumberoffull-timeequivalentemployees),andindustry.Largecompanieswere
oversampledtoproduceasignificantnumber
ofresponsesforseparateanalysis.Thedata
hasbeenweightedbygeographicdistribution
ofestablishments12,numberofemployees
(companysize),andindustrysectortoreflect
nationalUnitedStatesCensusdata.
Thesurveyincluded26multipartquestions
andadditionalquestionsforcompanysize,
industry,ownership,headquarterslocation,
andfinancialperformance,amongothers.
Someofthequestionsweretrackingquestionsusedinthepreviousthreesurveys.Only
directcomparisonstothe2007surveyresults
canbemade,asthetwoearliersurveysused
differentsamplingmethodology.
Survey goals
Themaingoalofthissurveywastosample
small,mediumandlargecompaniesinthe
UnitedStatestodeterminehowcorporate
citizenshipactivitieshavechangedduringa
periodofdeepfinancialandeconomicrecessionintheUnitedStatesandglobally.The
surveyalsosoughttoexploreseniorexecutives’attitudesandaspirations,andtoidentify
keytrendsanddifferencesamongbusinesses
bysize,typeofownership,andwhotheysell
to(customers,otherbusinesses,orboth).
21
Establishments (i.e., “branch” of a firm) were used in weighting,
rather than firms (main company enterprise).
26%
45-54
State of Corporate Citizenship 2009
5
Boston College Center for Corporate Citizenship
Figure 1
Description of 2009 sample
Keyissuesexploredbythesurveyinclude:
• Whatchangesintheircorporatecitizenshippracticesarebusinessesmakingduringtheseturbulenttimes?
• Whatdotheyseeasthebestwaystosolve
thecurrenteconomiccrisisandcreatea
morestableAmericaneconomy?
• Whatdobusinessesseeasthemostimportantareasofcorporatecitizenshipintheir
organizations?
• Whatmotivatesthemtobebetter“corporatecitizens”andhasthischangedsince
the2007survey?
• Howwellaretheymanagingcorporate
citizenshipacrosstheirorganization?
• Howwellaretheyincorporatingcorporate
citizenshipintheirproductsand
services?
• Hastheirsupportforthecommunitiesin
whichtheyoperatechanged?
• Havetheycontinuedtosupportlowerincomeoreconomicallydistressed
communities?
• Whoaretheypartneringwithtosolve
socialandenvironmentalproblems,
andwhy?
Defining Corporate Citizenship
Therearemanytermsusedtodescribethis
aspectofbusiness.Weusecorporatecitizenshipanddefineitasthewayacompanytakes
responsibilityandisaccountableformanagingitssocialandenvironmentalimpactson
society–fromthedesignofitsproductsand
services,tothemanagementofitsoperations
tothewayitworksbeyondthefencelineto
addresssocialandenvironmentalchallenges.
6
State of Corporate Citizenship 2009
Company size
Small companies
(1-99 employees)
36%
Medium companies
(100-999 employees)
24%
Large companies
(1,000+ employees)
40%
Company ownership
Publicly owned
Company operation location
Operate only in the U.S.
71%
Operate in one other
country besides U.S.
6%
Operate in 2-20 countries
besides the U.S.
13%
Operate in 21+ countries
besides the U.S.
8%
16%
Selling to
Businesses primarily
Women owned
24%
32%
Minority owned
10%
Consumers primarily
42%
Locally owned
73%
Businesses and consumers
approximately equally
23%
Don’t know
3%
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Context for corporate citizenship in the United States
Therehasbeenasignificantchangeinthe
businessoperatingenvironmentsincethe
2007StateofCorporateCitizenshipsurvey.A
varietyofforcesandcircumstanceshavecombinedtoinfluenceattitudesaboutcorporate
citizenshipandtheactionsofthoseresponsibleforitspractice.Butthegreatestsinglefactor,withoutargument,istheeconomicstorm
thatbegantowhipupattheendof2007.
Therecessionthatbeganwiththebursting
ofthehousingbubbleandrelatedfinancial
crisisintheUnitedStates,quicklyspreadto
othersectorsandaroundtheworldbecauseof
interdependenteconomies.Thefinancialtidal
wavesweptfromWallStreettoMainStreet
astheDowplummetedalongwithcorporate
profitsandhousingprices.Theonlythinggoingupfastwasunemployment.
Inresponsetothecrisis,governmentsaround
theworldcoordinatedtheireffortstoexpand
moneysupplyandpreventacreditfreezethat
hadbroughttheglobalfinancialsystemto
nearcollapse.InOctober2008theEmergencyEconomicStabilizationActwassignedinto
lawtoprovideemergencybailoutthroughthe
TroubledAssetsReliefProgram,orTARP,
Barometer for business in the 2008-09 recession
Perhaps the true impact of the recession on American business is best described by a
sampling of numbers appearing on the economic weather map in the past two years:
• The Dow Jones Industrial Average dropped more than 50 percent to 6,547 in March 2009
from its high of 14,000 in July 2007
• Housing prices plunged more than 30 percent from their 2006 peak
• Total home equity dropped from $13 trillion in 2006 to $8.8 trillion by mid-2008
• Real GDP decreased at an annual rate of 5.5 percent in the first quarter of 2009, and 6.3
percent in the fourth quarter of 2008, according to the Bureau of Economic Analysis
• Corporate profits were down 10.1 percent in 2008 compared to 2007 and fell another 17.6
percent in the first quarter of 2009
• Between December 2007 and June 2009 the United States lost 6.5 million jobs
• Unemployment went from 4.5 percent in June 2007 to 9.5 percent in June 2009
• Average work hours per work week declined to 33 (the lowest since the government began
collecting the data in 1964)
• Oil prices soared from $50 to $140 per barrel between early 2007 and 2008, then fell
below $40 in late 2008
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
7
Boston College Center for Corporate Citizenship
tofinancialandotherstrugglingbusinesses
suchasautomakers.TheU.S.Federal
Reservewentfrombeingthe“lenderoflast
resort”tothe“lenderofonlyresort.”
Tonosurprise,trustinbusinessdroppedto
arecordlow.AccordingtotheJanuary2009
EdelmanTrustBarometer,77percentof
Americansin2009saidtheytrustedbusinesslessthantheydidayearbefore.With
businesspracticesbeingscrutinizedand
anewadministrationintheWhiteHouse
promisingchange,thetimewasripeforcalls
tointroducesweepingregulatoryinitiatives
onconsumerprotections,executivepay,bank
financialrequirements,climatechangeand
healthcare.
Whilethedarkeconomiccloudscontinue
toloomoverhead,otherdevelopmentshave
madetheirmarkonthecorporatecitizenship
landscape.Demandforgreenandsustainableproductsandserviceshascontinuedto
grow.AccordingtoanApril2009reportby
GMA-Deloitte,54percentofshoppersactively
considerenvironmentalsustainabilitycharacteristicswhenbuyingproducts.Whengiven
achoicebetweenproductsofequalquality
andprice,consumersaremorelikelytobuy
fromacompanythatmanufacturesenergyefficientappliancesandproducts(90percent),
promotesconsumerhealthandsafetybenefits
(88percent),supportsfairlaborpractices(87
percent),commitstoenvironmentallyfriendly
practices(87percent)andmanufacturesits
productsintheUnitedStates(86percent)
(BBMG2008).
Theeconomydidhelpkeep“cleanandgreen”
onthefrontburner.Acentralelementinthe
8
State of Corporate Citizenship 2009
federalgovernment’sstimuluseffortswith
the$787billionAmericanRecoveryand
ReinvestmentActwastojump-startthe“clean
energyeconomy”withtaxbreaksandincentivesforcleanenergy.
Theinterestinsustainabilitydoesnotend
withconsumersorgovernment.Mainstream
investingisslowlymovingtoincorporate
social,environmentalandgovernancecriteria.
Venturecapitalforcleantechprojectsdoubledbetween2007and2008andreacheda
record$7.6billion(StateofGreenBusiness
2009).
Insidecompanies,theC-suitehasnoticeddevelopmentsoutsideitsusualrealmthatshow
uponthebottomline.ArecentjointBoston
CollegeCenter/McKinseysurveyfoundtwothirdsofCFOsagreeenvironmental,social
andgovernanceactivitiesdocreatemeasurablevaluefortheirshareholders.Executives
arealsorecognizingthatthemessageof
corporatecitizenshipresonatesfromoffice
cubiclestotheshoproomfloor,providinga
meanstoattractandretaintoptalent.
Overthepasttwoyearsmorecompanieshave
realizedtheymustcommunicateabouttheir
corporatecitizenshipefforts.Thenumberof
companiesreportingtheirsocialandenvironmentalperformancecontinuedtoincrease
inresponsetopressuresfromstakeholders
anddesiretoimprovereputation.According
toCorporateRegister.com,therewere3,100
CSRreportspublishedin2008,comparedto
2,000in2007.Two-thirdsoftheGlobalFT
500producedsuchareportin2008.Inthe
UnitedStates,73ofthelargest100companiesproducednonfinancialreports.
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
The State of Corporate Citizenship 2009
Weathering the economic storm
Despitethedeepnationwideandglobalrecession,Americancompaniesofallsizeshave
generallymaintainedtheirsupportforcorporatecitizenshipinitiatives.Whilecharitable
giving,productandservicedonations,and
communityinvestmentregistereddeclines,
U.S.businessesputmoreeffortsintointegratingcorporatecitizenshipwiththeir
businessstrategy,andlaunching“green”and
sustainableproductsandservices.Thesurvey
of756executivesforthe2009StateofCorporateCitizenshipintheUnitedStatesreveals
thatmorebusinessleadersrecognizetheconnectionofcorporatecitizenshiptoreputation
atatimewhentheAmericanpublic’sdistrust
ofbusinessisatarecordhigh.
Astheyrideoutthestorm,businessleaders
saytheyshouldbeplottingacoursetoward
greaterinvolvementinaddressingsocialand
environmentalissues.Morethan50percent
ofthosesurveyedsaybusinessmustplaya
greaterroleinfindingwaystomeetthechallengesofhealthcare,productsafety,public
educationandclimatechange.
Thisisalloccurringduringaperiodofeconomicandfinancialturbulenceunequaled
sincetheGreatDepression.Thenationand
companiesofallsizesarenavigatingseeminglyunrelentingbadeconomicandbusiness
developments.Abouthalfoftheexecutives
surveyed(48percent)reportthattheircompaniessawdecreasesinrevenues/sales.
www.BCCorporateCitizenship.org
Change in revenues/sales
reported by participants in the survey
26%
Increased
48%
Decreased
26%
Remained stable
Despitethis,morethantwo-thirds(69
percent)agreethatcorporatecitizenship
needstobeapriorityand54percentofthe
respondentsagreeorstronglyagreethat
corporatecitizenshipisevenmoreimportant
inarecession.Andtheyincreasinglyseethe
valueoftalkingaboutit.Communicating
corporatecitizenshipactivitiesinternallywith
employeesandexternallywithstakeholders
hasincreasedsignificantlysincethe2007
survey.Fifty-fourpercent(comparedto36
percentin2007)sayitistrueorverytruethat
theydiscusscorporatecitizenshipinsidethe
companywithemployees.Thirty-ninepercent
(comparedto29percentin2007)discuss
corporatecitizenshipoutsidethecompany
withstakeholders.
State of Corporate Citizenship 2009
9
Matters of money and mind set:
The impact of the recession on corporate citizenship 2009
How bad did the recession hit the companies in the 2009 State of Corporate Citizenship survey?
Roughly half of the firms sampled reported revenue declines in the past year, with nearly one-in-four
suffering declines of more than 15 percent.12 Revenues in one-quarter of the companies surveyed
were relatively stable and another one-in-four saw revenue gains.
In this context, a number of firms recorded layoffs (27 percent) and undertook reductions in staff
hours, pay, and benefits (24 percent). Not surprisingly, investments in corporate citizenship also
diminished in many firms. Some 38 percent reported declines in their philanthropy and charitable
giving and 15 percent reported a decrease in their citizenship marketing and communications
(see Figure 7).
To validate the relationship between the impact of the recession on firms and their citizenship
investments, researchers looked at the overall impact of the economy on firms, taking into account
revenue trends, layoff decisions and any
reductions in hours/wages/benefits. The
Impact of the economy on philanthropy: (Revenue,
combined results show that 29 percent of
layoffs, hours/wages vs. giving this past year)
companies suffered a significant negaSpending
Spending
tive economic impact, while 44 percent
less on
About the
more on
philanSame
philanexperienced a more modest impact, and
thropy
thropy
27 percent actually did comparatively well.
Negative economic
The tables at right show that the economic conditions facing firms correlate to
their charitable giving (for more on this
see Page 40). Among companies working
through negative financial conditions 59
percent spent less on philanthropy, while
almost 39 percent in this category spent
about the same. For companies that
experienced mixed economic results, 52
percent spent about the same on giving
as in the past, while 38 percent spent less.
Most firms that did well economically
spent the same on charity (63 percent)
with roughly the same portions spending
more as spending less. The economic
impact on corporate spending on citizenship marketing and communications was
similar, albeit less pronounced.
impact
Mixed economic
impact
Positive economic
Impact
59
39
2
38
52
9
18
63
19
Impact of the economy on corporate citizenship marketing and communication: (Revenue, layoffs, hours/
wages vs. investments this past year)
Spending
Spending
less on
About the
more on
market-
Same
market-
ing
Negative economic
impact
Mixed economic
impact
Positive economic
Impact
ing
30
63
7
11
82
8
6
72
22
12Some 23% of companies surveyed saw their revenues decrease by more than 15%; 13% were down by 6 to 14%; and 12% were down by 3 to 5%.
10
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Attitudes of executives
Reputation is the anchor
The2009surveyshowscompaniesincreasinglyfindbusinessvalueincorporatecitizenshipefforts.Inthepreviousthreesurveys
thetopdriverforsocialandenvironmental
responsibilitywascompanies’traditionsand
values.In2007reputationemergedasa
strongseconddriverandin2009itshares
thetopspotat70percentwithcompany
traditionsandvaluesinmotivatingbusiness
actions(seeFigure2).Forlargecompaniesit
isthetopdriverofcorporatecitizenship,cited
by82percentofrespondentsfromcompanies
withmorethan1,000employees.
Goodreputationisincreasinglylinkedto
bottomlinebenefitssuchasimprovedsales,
licensetooperate,employeemoraleand
productivity,andattractingandretaining
toptalent.A2008BostonCollegeCenter/
ReputationInstitutestudyfoundthatcorporatecitizenshipisthesecondmostimportant
driverofreputationafterqualityofproducts
andservices2.
Executives recognize the role of business
in addressing the economic crisis
Companyleadersaresayingbusinesshasa
majorroletoplayinsolvingthecurrenteconomiccrisisandestablishingamorestable
Americaneconomygoingforward.More
ethicalandvalues-basedleadershipintheexecutiveofficesiscitedby66percentofsenior
executivesasanimportantfactorinaddressingeconomicwoes.Moreeffectivecorporate
governancepractices(61percent)andmore
effectiveindustryself-regulatorypoliciesand
initiatives(58percent)(seeFigure3)alsoregisteredstronglyasimportantfactors.
Businessexecutivesdonotseemoregovernmentinterventionasthebestapproach.Most
seniorexecutivesdonotwelcomepotential
effortsatgreaterregulatoryoversightbythe
governmentorcreatinganewframeworkfor
globalregulationandgovernance.While38
percentofseniorexecutivessayitisimportant
orveryimportanttohaveanewframework
forglobalregulationandglobalgovernance,
and34percentsupportgreaterregulatory
oversightbyfederalgovernment,22percent
believethatgreaterregulatoryoversightisnot
atallimportant.
Companies want to be good corporate
citizens but do not want to be told how
Businessleadersacknowledgetheyhavea
vitalroletoplayinaddressingawiderange
ofsocietalissues,however,theyfeelstrongly
thatthedecisiontogetinvolvedistheirsto
make(seeFigure5).Despitethegrowing
importanceofcorporatecitizenshipforU.S.
companiesintermsofimprovingreputation
andidentifyingbusinessopportunities,there
wasadeclineinthepercentageofsenior
executiveswhobelievethepublichasaright
toexpectgoodcorporatecitizenship,from65
percentin2007to57percentin2009.
2
The study defined corporate citizenship as supporting good
causes and not harming the environment. Other factors considered in the study included performance, innovation, workplace,
governance and leadership.
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
11
Boston College Center for Corporate Citizenship
Figure 2
Drivers of corporate citizenship
Question asked: To what extent do each of the following factors “motivate”
or “drive” your company’s efforts to be a good corporate citizen?
■ 5-Very great amount ■ 4-Large amount ■ 3-Moderate amount
■ 2-Small amount
■ 1-Not at all ■ Don’t know
It fits our company traditions and values
2009
37%
2007
37%
33%
1%
Medium
Large
67%
72%
80%
66%
70%
82%
54%
63%
65%
51%
59%
71%
33%
51%
1%
16%
39%
Small
6% 3%
19%
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
4% 3%
It improves our reputation/image
2009
33%
2007
5% 4%
37%
30%
1%
20%
36%
1%
24%
5% 4%
It’s important to our customers/consumers
9% 7%
2009
31%
27%
2007
22%
1%
25%
*
29% 11%
31%
6%
It’s part of our business strategy
2009
32%
24%
2007
2%
26%
34%
26%
9% 7%
23%
*
11%
6%
It helps to recruit and retain employees
2009
2007
15%
13%
27%
29%
14%
13%
2%
28%
30%
15%
13%
1%
63%
*Less than 1%
12
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
■ 5-Very great amount ■ 4-Large amount ■ 3-Moderate amount
■ 2-Small amount
■ 1-Not at all ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Small
It gives us a competitive advantage
2009
15%
24%
31%
16%
13%
0%
2007
16%
25%
28%
16%
14%
1%
16%
0%
20%
1%
Medium
Large
36%
40%
50%
30%
38%
48%
25%
43%
54%
23%
41%
46%
21%
31%
44%
It helps us reduce business risks
2009
11%
2007
10%
24%
28%
23%
21%
18%
28%
It’s expected in our community
2009
14%
20%
35%
18%
13%
1%
2007
13%
20%
33%
20%
14%
*
21%
0%
25%
1%
It helps manage regulatory pressures
2009
10%
2007
10%
21%
19%
27%
27%
20%
18%
It allows us to get involved in the public policy debate
2009
11%
16%
31%
www.BCCorporateCitizenship.org
20%
21%
0%
State of Corporate Citizenship 2009
13
Boston College Center for Corporate Citizenship
Figure 3
The role of business in solving the econ0mic crisis
Question asked: How important do you think each of the following will be in solving the current
economic crisis and creating a more stable American economy going forward?
Please use a scale of 1 to 5 where 1 means “not at all important” and 5 means “very important.”
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
■ 5-Very important ■ 4
■3
■ 2 ■ 1-Not at all important ■ Don’t know
Small
More ethical and values-based leadership in the C-suite
Medium
Large
66%
68%
65%
59%
64%
63%
56%
63%
57%
36%
39%
40%
34%
32%
36%
7% 4%
2009
38%
1%
22%
28%
More effective corporate governance practices
8% 8%
2009
23%
1%
23%
38%
More effective industry self-regulatory policies
and initiatives
8% 7%
2009
0%
26%
34%
24%
A new framework for global regulation and
global governance
2009
15%
31%
23%
13%
17%
1%
Greater regulatory oversight by federal government
2009
15%
19%
26%
17%
22%
Thedeclinecouldbelinkedtopressureson
companiesofallsizestryingtosurvivearecessionandfindingfewerresourcestoinvest
insocialandenvironmentalissues.Companieswidelysupportkeepingcorporatecitizenshipcompletelyvoluntary.Thisreluctanceto
14
State of Corporate Citizenship 2009
0%
submittocorporatecitizenshipmandatesis
accompaniedbyabeliefthatthereisalackof
recognitionforexistingefforts.Almostthreefourthsofseniorexecutivesbelievemuchof
whatcompaniesdoforcommunitiesisnot
knownortalkedabout.Thiscouldbeafactor
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Figure 4
Business involvement in public policy issues
Question asked: To what extent do you think business should be more or less involved, than it is today,
in helping solve the following public policy issues? Please use a scale of 1 to 5 where 1 means “much less
involved,” 3 means “current level of involvement is appropriate,” and 5 means “much more involved.”
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
■ 5-Much more involved ■ 4
■ 3-Current level of involvement is appropriate
■ 2 ■ 1-Much less involved ■ Don’t know
Small
Product safety
2009
3%
33%
27%
34%
Medium
Large
68%
64%
67%
63%
72%
65%
54%
62%
57%
54%
51%
56%
1%
2%
Health care
5%
2009
31%
34%
25%
1%
4%
Public education
2009
6%
34%
22%
34%
0%
3%
Climate change
2009
8%
27%
26%
30%
0%
8%
38%
Gap between rich and poor
2009
15%
23%
38%
13% 11%
intheincreasedreportingbycompaniessince
the2007survey(seeFigure13).
Atthesametimethatexecutivesdislikebeing
proddedtobegoodcorporatecitizens,most
recognizeit’snotsimplysomethingniceto
www.BCCorporateCitizenship.org
37%
35%
1%
do.Inthe2009survey,54percentofrespondentsagreeorstronglyagreethatcorporate
citizenshipisevenmoreimportantinarecessionandmorethantwo-thirds(69percent)
agreethatcorporatecitizenshipneedstobea
priority(seeFigure5).
State of Corporate Citizenship 2009
15
Figure 5
Attitudes toward corporate citizenship
Question asked: Please indicate how much you agree or disagree with the following statements.
■ 5-Strongly agree
■ 4-Agree
■ 3-Neither agree/disagree
■ 2-Disagree
■ 1-Strongly disagree ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Many companies do a great deal more for their
communities than is talked about or known
Small
5%0%
2009
24%
2007
23%
1%
20%
50%
48%
Medium
Large
73%
73%
74%
72%
74%
66%
61%
76%
81%
62%
61%
63%
59%
62%
57%
53%
64%
61%
54%
52%
56%
*
19%
8% 1%
Corporate citizenship should be completely voluntary
– no laws/regulations should govern it
7% 1%
2009
35%
19%
0%
36%
21%
*
37%
2007
33%
8% 1%
Corporate citizenship needs to be a priority
for companies
2009
44%
25%
2007
29%
44%
3% 3%
26%
0%
22%
*
3% 2%
Corporate citizenship makes a tangible contribution
to business’ bottom line
5% 1%
2009
16%
2007
17%
46%
44%
30%
1%
31%
1%
7%1%
Many companies promote corporate citizenship,
but are not truly committed to it
5% 1%
2009
2007
15%
44%
17%
45%
34%
0%
32%
*
4% 1%
The public has a right to expect good corporate
citizenship from companies
8% 5%
2009
19%
2007
21%
0%
31%
38%
44%
1%
25%
6% 3%
Corporate citizenship is more important in a recession
9%
2009
18%
36%
34%
0%
3%
*Less than 1%
Learning, Practice, Results. In Good Company
Has the recession changed Americans’ expectations for corporate citizenship?
Mismanagement of the financial sector and the subsequent economic crisis contributed to a
major drop in trust in business since the 2007 State of Corporate Citizenship survey.
A July 2009 poll by Edelman found that only 48 percent of the American public trusts business, down from 59 percent a year earlier. Americans feel so strongly that business cannot be
trusted to act responsibly that 50 percent of those polled by GlobeScan for its 2008 CSR Monitor said more laws are needed to regulate corporate social responsibility. That’s an increase
from 40 percent who felt that way in 2006.
While trust in business is falling, Americans’ expectations of business for corporate citizenship and social responsibility have continued to grow. In Edelman’s July 2009 Trust Survey
more than 60 percent of American opinion leaders said they believe that business has not
done enough to address key policy issues such as the environment and access to health care.
And 55 percent do not believe business is doing enough to work with government to solve the
economic crisis.
Americans also expect business to step up, not step back, when it comes to supporting
worthy causes and organizations. In its 2009 report “Corporate Citizenship and American
Business”, GolinHarris revealed that 74 percent of Americans surveyed in the first quarter of
2009 said, now more than ever, businesses must show leadership, courage and commitment
in keeping corporate citizenship among the top business priorities for meeting the economic
challenge. The public does, however, seem to recognize that the capability of business to
contribute to community is impacted by the economic crisis. In the same Golin Harris survey,
53 percent said they expect monetary and financial contributions to decrease in the current
economy.
While recognizing the financial pressures of the recession, Americans still expect companies
to make corporate citizenship a core part of how they do business. In the June 2009 Cone
Consumer Environmental Survey, 35 percent of Americans said they have higher expectations
for companies to make and sell environmentally responsible products and services despite
the economic downturn. The same survey found that 71 percent of Americans say “doing well
by doing good” is a smart and savvy business strategy.
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
17
Figure 6
The role of business in society – How business defines corporate citizenship
Question asked: Corporate citizenship means different things to different companies.
In your opinion, how important is each of the following to your company’s role in society?
The 5-point scale ranged from “not at all important” to “critical.”
■ 5-Critical ■ 4-Very important
■ 3-Important
■ 2-Somewhat important
■ 1-Not at all important
■ Don’t know
Operating with ethical business practices
7% 1%
2009
61%
2007
60%
30%
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Small
1%
0%
Medium
Large
91%
90%
90%
81%
82%
81%
71%
81%
87%
62%
66%
68%
1%
27% 9%
2% 1%
Valuing employees and treating them well
2% 2%
2009
42%
39%
2007
43%
38% 12%
14%
1%
1%
4%2%
Managing and reporting company finances accurately
3% 1%
2009
45%
31%
2007
45%
31%
19%
1%
1%
16%
5% 2%
Maximizing long-run profits for your
owners/shareholders
2009
32%
2007
29%
32%
32%
6%
20%
10%
1%
19% 9% 10%
1%
Marketing and advertising products and services
responsibly
6% 3%
2009
26%
2007
38%
28%
40%
26%
0%
23%
*
59%
73%
61%
62%
72%
45%
74%
72%
71%
6% 3%
Protecting consumers
2009
8% 3%
34%
30%
2007
27%
33%
2%
24%
*
26% 10%
3%
Providing employee benefits
2009
2007
15%
20%
41%
40%
5%
27% 11%
1%
*
26%
7% 6%
*Less than 1%
18
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
■ 5-Critical ■ 4-Very important
■ 3-Important
■ 2-Somewhat important
■ 1-Not at all important
■ Don’t know
Working with suppliers/vendors to ensure they
operate ethically
4%
2009
21%
2007
22%
32%
Medium
Large
53%
58%
67%
52%
62%
59%
44%
56%
63%
45%
43%
63%
1%
13%
30%
Small
0%
29% 10%
36%
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
4%
Providing good paying jobs
2009
2007
8% 4%
39%
16%
34% 9%
39%
13%
4%
29%
*%
4%
Improving conditions in your community
2009
2007
34%
17%
19%
36%
5%
34% 11%
0%
31% 11%
1%
3%
Protecting the environment
4%
2009
17%
31%
34%
2007
17%
32%
34% 12%
1%
13%
1%
3%
Building employee diversity within your business
2009
17%
2007
17%
30%
29%
12% 11%
37%
55%
33%
47%
53%
35%
46%
52%
71%
1%
31% 11%
32%
0%
8%
Supporting employee volunteerism
2009
2007
11%
16%
29%
30%
34%
29%
20% 10%
1%
*
15%
7%
Responding to community/interest groups
regarding issues they care about
2009
2007
12%
14%
28%
32%
29%
7%
0%
22%
32%
1%
15%
6%
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
19
Boston College Center for Corporate Citizenship
Most senior executives believe business
should do more to tackle social problems
Theeconomiccrisisisnottheonlyplace
wherebusinessleadersbelievetheyhavea
keyroletoplayincreatingsolutions.Most
believeitistimeforcompaniestostepupand
becomemoreinvolvedinsolvingotherimportantissuesfacingsociety.Amongtheseisthe
vexingissueofhealthcare,wherebusinessis
bracingtobearmoreofthefinancialburden
aslegislationiscraftedtoreformtheU.S.
system.Oftheseniorexecutivessurveyed,65
percentsaybusinessshouldbemoreinvolved
infindinghealthcaresolutions(seeFigure4).
Amongleadersofmid-sizedcompanieswith
100to999employees–whererisinghealth
insurancecostsareofconsiderableconcern
20
State of Corporate Citizenship 2009
–72percentsaybusinessshouldbemore
involved.Themajorityofexecutivesfrom
companiesofallsizessaybusinessshould
alsobemoreinvolvedinaddressingproblems
withproductsafety,publiceducationand
climatechange(seeFigure4).
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Actions
Figure 7
Impact of recession
Riding out the recession
Tosurvivetherecessionmanybusinesses
implementedcost-cuttingmeasures:27percentofcompaniesreportedincreasedlayoffs
(thepercentageismuchhigherforlarge
companies–54percent),24percentreported
reducedwages,benefitsorworkhours,and
38percentreportedreducedcharitablegiving.
Atthesametime,while19percentofcompaniescutR&Dinvestmentsinnewsustainable
productsandservices,15percentactually
increasedtheseinvestments.Amidtherising
tideofcutsinotheraspectsofbusiness,only
15percentcutbackoncorporatecitizenship
marketingandcommunicationwhile11percentactuallyincreasedit.
Thepreviousthreebiennialsurveysofsenior
executivesalldemonstratedthatcorporatecitizenshipisimportanttoAmericancompanies
ofallsizes.Thistimearound,thatemphasis
wasputtothetestduringaperiodwhenevery
aspectofbusinesswasbeingexaminedforits
valueandpotentialbusinessopportunities.
Thissurveyindicatescorporatecitizenship
isstandinguptothatchallengetotheextent
itcanhelpbusinesscutcosts,differentiate
productsandservicesfromcompetitorsinthe
marketplace,improvereputationandbolster
employeemorale.
Companies seek opportunities to save,
differentiate, and polish reputation
Thetopthreeareasforbusinessopportunitiesthroughcorporatecitizenshipthatwere
seizedonbycompaniesinclude:
www.BCCorporateCitizenship.org
Question asked: Based on the current economic
conditions companies are making various changes.
To what extent has your company increased or
decreased each of the following? Please use a scale of
1 to 5 where 1 means “greatly decreased,” 3 means
“no change”, and 5 means “greatly increased.”
■ 5-Greatly increased
■ 4
■ 3-No change
■ 2
■ 1-Greatly decreased
■ Don’t Know
Employee layoffs
2009
10%
5%
64%
17%
0%
3%
R&D for new sustainable products/services
2009
12%
64%
1%
13%
3%
6%
Work hours, pay or benefits
2009
10%
61%
1%
20%
3%
4%
Philanthropy/giving
2009
8%
2%
50%
27% 11%
2%
Corporate citizenship marketing and communication
2009
9%
3%
71% 10%
2%
5%
Local/domestic sourcing or manufacturing
2009
7%
2%
76% 8%
3%
5%
Support for skill development, education and career
advancement of existing employees earning less
than $40,000/year
2009
8%
2%
0%
75% 9%
State of Corporate Citizenship 2009
6%
21
Boston College Center for Corporate Citizenship
• Reducingcoststhroughimprovedmaterialsefficiency,72percent
• Manufacturingorsourcingdomestically/
locally,58percent
• Increasingbrandawarenessas“green”or
sociallyresponsible,53percent
Amonglargecompanies65percentaimtodesignandoffersustainableproducts/services,
59percentofferenergyefficientproductsand
another59percentprovidecustomerswith
moreinformationaboutsocialandenvironmentalimpactsoftheirproductsandservices
(seeFigure8).
Figure 8
Finding opportunities through corporate citizenship
Question asked: Many companies are identifying new business opportunities through CSR initiatives.
Please indicate which of the following you are currently doing.
Yes,
currently doing
(all companies)
Reducing costs through improved materials efficiency
Manufacturing or sourcing domestically/locally
Increasing brand awareness as “green” or
socially responsible
Designing and offering sustainable
products/services
Providing customers with more information about
products/services’ social and environmental impacts
Offering more energy efficient products/services
Providing frontline employees with business training
to broaden and improve commercial awareness
Using CSR as market differentiator
22
State of Corporate Citizenship 2009
Breakdown by company size - 2009 only
Small
Medium
Large
64%
79%
85%
56%
62%
60%
45%
60 %
69%
44%
60%
65%
45%
58%
59%
40%
59%
59%
35%
61%
64%
14%
36%
32%
72%
58%
53%
52%
50%
48%
46%
22%
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Figure 9
Managing and communicating corporate citizenship
Question asked: Companies manage corporate citizenship in different ways. Next are some questions
about leadership in corporate citizenship. To what extent is each of the following true of your company?
Please, use a scale of 1 to 5 where 1 means “not at all true” and 5 means “very true”.
■ 5-Very true ■ 4
■3
■2
■ 1-Not at all true ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Small
The CEO leads the corporate citizenship agenda inside
the company
4%
2009
46%
29%
17%
Medium
Large
77%
78%
67%
46%
62%
69%
30%
46%
59%
0%
4%
We discuss corporate citizenship inside the company
with employees
2009
2007
29%
25%
16%
20%
22%
28%
14%
13% 10%
0%
21%
1%
We discuss corporate citizenship outside the company
with stakeholders (e.g., suppliers, customers,
regulators, NGOs, etc.)
2009
15%
2007
11%
24%
18%
28%
29%
16%
17%
17%
1%
23%
1%
Companies are increasing communication
about corporate citizenship efforts
Supportfromthetopandcommunicationof
corporatecitizenshipvaluesinsideandoutsidethecompanywasreportedtobestrong
andgrowing.Inthreeoutoffourcompanies
theCEOleadsthecorporatecitizenshipagenda.Since2007therehasbeenanincreasein
bothinternalcommunicationwithemployees
(from36percentto54percent)andexternal
communicationwithstakeholders(from29
percentto39percent).Amonglargecompa-
www.BCCorporateCitizenship.org
nies,explicitcorporatecitizenshipgoalsare
widespreadonemployeeeducation,trainingandcareeradvancement(80percent),
diversity(76percent),communitysupport
(71percent),environmentalresponsibility
(63percent),sustainableproducts/services
(63percent),andhumanrightswithinthe
supplychain(58percent).Morethanhalfof
largeU.S.corporationsreportthattheirboard
reviewsandapprovescorporatecitizenship
programs(59percent)(seeFigure10).
State of Corporate Citizenship 2009
23
Boston College Center for Corporate Citizenship
Figure 10
Corporate citizenship goals and objectives of large companies
Question asked of large companies only: Companies manage corporate citizenship in different ways.
Next are some questions about leadership in corporate citizenship. To what extent is each of the following
true of your company? Please, use a scale of 1 to 5 where 1 means “not at all true” and 5 means “very true”.
■ 5-Very true
■4
■ 3
■ 2
■ 1-Not at all true
■ Don’t Know
Our company has goals and objectives around
employee education, training and career
advancement
5%
2009
45%
13%
35%
Our company has goals and objectives around
sustainable products or services
9%
2009
2009
44%
32%
29%
22%
0%
0%
1%
Our company has goals and objectives
around diversity
34%
Our board reviews and approves our corporate
citizenship program
7%
5%
14%
5%
1%
2009
32%
27%
25%
1%
8%
3%
Our company has goals and objectives around
human rights within our supply chain
Our company has goals and objectives around
community support
12%
9%
2009
37%
34%
19%
0%
2009
33%
1%
25% 23%
7%
2%
Our company has goals and objectives around
environmental responsibility
10%
2009
39%
24%
22%
0%
5%
Increasing integration
Whiletopleadershipiscritical,integration
withbusinessstrategyrequirescommitting
resourcessuchaspeopleandfunding,buildinginternalcompetencies,andsettingclear
policiesandprinciplestosupportimplementation.Seniorexecutivesreportincreasesin
suchintegrationefforts.Ateamorindividual
isassignedtoworkoncorporatecitizenship
issuesin40percentofcompanies,upfrom
26percentin2007.Therehasalsobeenan
24
State of Corporate Citizenship 2009
increaseincompaniessettingpoliciesabout
corporatecitizenshipandintegratingitwith
thebusinessplanningprocess(seeFigure11).
Effectiveintegrationofcorporatecitizenship
withthebusinessstrategyalsorequiressettingperformancegoalsformanagersandkey
championsastheymayfaceconflictingobjectives,suchaspittingsales/revenuegrowth
againstensuringsuppliercompliance.
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Larger companies lead on integration
More companies are reporting on their
corporate citizenship efforts
Largecompaniesareclearlyrecognizingthe
needforintegration.Some70percentreport
havinggoalsformanagersaroundeducation,
trainingandskilldevelopment;58percent
havegoalsarounddiversity;50percentaround
sustainableproductsandservices;and47
percentaroundenvironmentalresponsibility
(seeFigure12).
Integratingcorporatecitizenshipwiththe
businessstrategyrequiresmakingthe“businesscase”andmeasuringtheROIorother
intangiblebenefitsfromsocialandenvironmentalinitiatives.Measuringthebusiness
value,however,isnotaneasyundertaking
Figure 11
Alignment and integration into the business
Question asked: Next are some questions about alignment and integration of corporate citizenship.
To what extent is each of the following true of your company?
Please, use a scale of 1 to 5 where 1 means “not at all true” and 5 means “very true”.
■ 5-Very true ■ 4
■3
■ 2 ■ 1-Not at all true ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Corporate citizenship is an integral part of our
business planning process
2009
2007
19%
24%
15%
25%
24%
24%
15%
18%
Small
16%
1%
17%
1%
We have an individual or a team responsible for
corporate citizenship issues
2009
2007
19%
21%
12%
19%
14%
19% 11%
29%
1%
15%
39%
1%
We have policies or written statements about
corporate citizenship
2009
2007
16%
13%
17%
15%
19%
20%
15%
13%
33%
1%
38%
1%
We have training and education programs to advance
corporate citizenship in our company
2009
13%
15%
20%
www.BCCorporateCitizenship.org
16%
36%
Medium
Large
36%
46%
61%
31%
40%
65%
20%
45%
65%
17%
29%
57%
1%
State of Corporate Citizenship 2009
25
Boston College Center for Corporate Citizenship
andtherearenowidelyacceptedframeworks
andindicators.Mostofthebenefits,particularlyinthesocialarea,arequalitativeand
hardtoquantify,suchasimprovedemployee
moraleandproductivity,reputationandlicensetooperate.Thesurveyshowsthatabout
oneinthreecompanies(35percent)uses
somewaytomeasurebusinessimpact(see
Figure13),althoughnodataisavailableto
evaluatethequalityofsuchmeasures.
reporttothepublic.Businessesappeartobe
recognizingthattolinktheirproductsand
serviceswithanimageofresponsibilityand
reapthereputationalbenefits,theymustdo
abetterjobofbeingtransparentandtelling
theircorporatecitizenshipstories.
Companies are increasing green initiatives
in operations, products and services
Whileseniorexecutives’responsesindicate
theimportanceofprotectingtheenvironment
hasnotchangedsincethe2007survey,there
isevidencecompaniesofallsizesareincreasingtheirinvestmentsingreeningcommunities,operations,andproductsandservices.
Companiesofallsizesareincreasinglyreportingontheircorporatecitizenshipperformance–26percentcomparedto21percent
in2007.Amonglargecompanies,59percent
Figure 12
Management and accountability in large companies
Question asked of large companies only: Next are some questions about alignment and integration
of corporate citizenship. To what extent is each of the following true of your company?
Please, use a scale of 1 to 5 where 1 means “not at all true” and 5 means “very true”.
■ 5-Very true
■4
■ 3
■ 2
■ 1-Not at all true
■ Don’t Know
Individual managers have performance goals related
to employee education, training and career
advancement
7%
2009
28%
42%
16%
5%
33%
25%
20%
2009
23%
24%
23%
14%
16%
1%
1%
Individual managers have performance goals related
to diversity
2009
Individual managers have performance goals
related to environmental responsibility
14%
2%
Individual managers have performance goals related
to community support
2009
24%
21%
26%
13%
14%
2%
8%
Individual managers have performance goals related
to sustainable products and services
Individual managers have performance goals related
to human rights within our supply chain
2009
2009
25%
26
25%
24% 12% 12%
State of Corporate Citizenship 2009
2%
23%
18%
27%
16%
15%
2%
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Figure 13
Measuring and reporting
Question asked: Next are some questions about measuring and reporting on corporate citizenship.
To what extent is each of the following true of your company? Please, use a scale of 1 to 5 where
1 means “not at all true” and 5 means “very true”.
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
■ 5-Very true ■ 4
■3
■2
■ 1-Not at all true ■ Don’t know
Small
We measure the business impact of our
social initiatives
2009
13%
22%
24%
16%
24%
18%
12%
22%
16%
30%
11%
18%
20%
20%
30%
28%
36%
58%
23%
32%
51%
22%
30%
13%
33%
2%
We measure the social impact of our social initiatives
2009
11%
2007
15%
14%
17%
16%
15%
15%
41%
46%
50%
1%
We report to the public on corporate citizenship
issues
2009
Large
1%
We measure the business impact of our
environmental initiatives
2009
Medium
1%
59%
2%
7%
Inthe2009survey,29percentofbusiness
leaderssaytheircompaniessupportedenvironmentalissuesthroughtheircommunity
investmentstrategy–a10percentincrease
since2007andachangeinrankingfrom
seventhtothird(seeFigure16).Amonglarge
companies,63percenthavegoalsandobjectivesaroundenvironmentalresponsibility
www.BCCorporateCitizenship.org
(seeFigure10),58percentmeasurethebusinessimpactoftheirenvironmentalinitiatives,
and47percentreporthavingenvironmental
performancegoalsforindividualmanagers.
Protectingtheenvironmentisincreasingly
seenasprovidingbottomlinebenefits:
State of Corporate Citizenship 2009
27
Boston College Center for Corporate Citizenship
• 72percentofallAmericancompanies
(85percentoflargecompanies)are
reducingcoststhroughimprovedmaterials
efficiency;
• 53percent(69percentoflargecompanies)
areincreasingbrandawarenessasgreenor
sociallyresponsible,and;
• 52percent(65percentoflargecompanies)
aredesigningandofferingsustainable
productsorservices(seeFigure8).
Thegrowthinofferingandcommunicating
aboutsustainableproductsandservicesindicatesthatAmericancompaniesarebeginning
tocatchupwiththeiroverseaspeersinbringingcorporatecitizenshipstrategiestomarket
(seeFigure14):
• 41percentofU.S.companies(compared
to35percentin2007)designproducts
andservicesthattakeintoconsideration
impactsthroughouttheirlifecycle
• 43percent(comparedto37percentin
2007)advisetheircustomersaboutsustainablechoicesofproductsorservices
• 37percent(comparedto29percentin
2007)trackwhattheircompetitorsare
doingregardingsustainableproductsand
services
• 31percent(comparedto24percentin
2007)offerproductsthatarecertifiedand
labeledasenvironmentallyfriendlyor
sustainable
• 26percent(comparedto23percentin
2007)investR&Dresourcesintonew,
moresustainableproductsandservices.
Otherstudieshavealsoconfirmedthesepositivedevelopmentsintheenvironmentalarea
despitethebudgetcutsandthedeepreces-
28
State of Corporate Citizenship 2009
sion.ArecentGreenBizExecutiveNetwork
studyfoundthat47percentofcompanies
surveyedwereincreasingtheirinvestments
ingreenproductdevelopmentin2009,less
than6percentsaidtheywillbereducingsuch
investments.
Variouspowerful factorsaredrivingthe
“green”agendaintheUnitedStates–from
achangingregulatorylandscapeandmarket
incentivesforcleanenergy,toincreasing
customerandconsumerdemand,NGOpressuresandinvestorinterest:
• A2009surveybyAllianzGlobalInvestors
foundthat“investorsperceiveenvironmentalissuesaslong-lastingandpresenting
enduringinvestmentopportunity”with91
percentofrespondentsbelievingthatfindingsolutionstoenvironmentalproblems
willbeanissueforalongtime,and69
percentstatingtheirinterestin“green”
investments.
• GlobeScanGreendexresultsfor2009
revealedthatdespitetheglobalrecession
therehasbeenanincreaseinenvironmentallyfriendlyconsumerbehaviorin13of
the14countriesthatweresurveyedbothin
2008and2009.
Yet,skepticismremainsamongconsumersandotherstakeholdersabouthowtruly
“green”companiesare.The2008GreenGap
surveybyConeandtheBostonCollegeCenter
foundthat73percentofconsumersbelieve
companiesthatcommunicateabouttheenvironmentare“justtryingtosellmoreproducts
andservices,”and90percentsaycompanies
needtoprovetheir“green”claims.
www.BCCorporateCitizenship.org
Figure 14
Sustainable products and services
Question asked: Next are some statements about products and services.
To what extent is each of the following true of your company?
Please use a scale of 1 to 5 where 1 means “not at all” and 5 means “a great deal.”
■ 5-A great deal ■ 4 ■ 3
■ 2 ■ 1-Not at all ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
We advise our customers about sustainable choices
of products or services
2009
20%
2007
18%
23%
25% 10%
25%
25% 11%
19%
21%
1%
Small
Medium
Large
40%
46%
48%
37%
51%
54%
36%
49%
46%
29%
45%
50%
31%
40%
42%
27%
36%
37%
16%
37%
43%
2%
Our company’s products and services meet the needs
of lower-income people and communities
2009
19%
2007
20%
24%
12%
28%
20%
14%
26%
16%
1%
20%
1%
Our company designs products and services in a way
that takes into account their impacts throughout
their life cycle
2009
16%
2007
16%
25%
23% 10%
25%
1%
14%
26%
1%
25%
19%
We track what our competitors are doing regarding
sustainable product and service offerings
2009
13%
2007
12%
22% 10%
24%
24%
17%
12%
29%
1%
34%
2%
Our company offers products or services that benefit
the environment
2009
2007
14%
21%
16%
15%
24%
16%
15%
24%
26%
27%
0%
1%
We offer products that are certified and labeled as
environmentally friendly or sustainable using
programs like Energy Star or the Eco-Label,
for example
2009
2007
15%
16%
12% 12%
20%
12%
20% 12%
36%
1%
43%
1%
We invest R&D resources into new, more sustainable
products and services
2009
2007
10%
16%
12% 11%
24%
18%
13%
14%
36%
1%
44%
1%
Boston College Center for Corporate Citizenship
Community support dropped slightly
when corporate profits declined
The2009surveyshowstherecessionhashad
amodestnegativeimpactonphilanthropyand
communitysupport.Corporatedonationsand
sponsorshipsarecloselylinkedtocorporate
profitssoitisnotsurprising38percentof
companiesreducedphilanthropyandgiving
(seeFigure7)32.Thepercentageofcompanies
makingin-kinddonationsdroppedfrom65
32According to Giving USA, total corporate donations were $14.5
billion in 2008 (an 8 percent drop compared to 2007). In comparison, corporate profits were down 10.1 percent in 2008.
percentin2007to60percentin2009,those
providingemployeevolunteeringopportunitiesfellfrom64percentto57percent,and
communityinvestmentsweredownfrom30
percentto21percent.
Thetopthreeareasofcommunitysupportby
U.S.companiesin2009wereeducation(46
percent),healthcare,includingnutritionand
physicalfitness(33percent),andenvironmentalissues(29percent).Mid-sizecompanies
supportedjobtrainingatamuchhigher
rate(45percentcomparedto27percentfor
allU.S.companies)andsmallcompanies
Figure 15
Community support
Question asked: Does your company provide support to the community in
any of the following ways? Please, select all that apply.
Breakdown by company size - 2009 only
All companies
Cash donations and sponsorships*
In-kind donations of goods and services
Employee volunteering
Community investment projects
Don’t know
Small
62%
Medium
77%
56%
61%
69%
2007
60%
65%
2009
57%
44%
69%
83%
2007
64%
2009
11%
27%
46%
2007
21%
30%
2009
8%
13%
1%
2%
2007
6%
2009
2007
2009
68%
69%
Large
78%
*Note: In 2007 survey the question included only “cash donations”
30
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Figure 16
Top areas of community support
Question asked: Based on the amount of resources invested in community support
activities (e.g., money, time, product and service donations), which are the top
three areas your company supported in the past year?
Breakdown by company size - 2009 only
Combined mentions
All companies
Education
2009
2007
Small
Medium
Large
46%
53%
40%
61%
26%
39%
48%
29%
27%
29%
49%
Health care, including nutrition and
physical fitness
2009
2007
33%
36%
Environmental issues
2009
29%
2007
19%
2009
27%
32%
18%
45%
36%
25%
26%
30%
18%
19%
20%
22%
27%
2007
22%
19%
2009
19%
21%
18%
15%
2007
15%
2009
18%
15%
23%
13%
8%
12%
12%
12%
13%
13%
7%
12%
11%
2007
9%
12%
2009
7%
7%
7%
11%
2007
10%
2009
6%
19%
10%
0%
3%
Job training
2007
Arts and culture
Economic development
Community safety
Sports
2009
2007
2009
2007
Child care
Affordable housing
Literacy
Don’t know/no answer
2009
2007
2009
2007
www.BCCorporateCitizenship.org
State of Corporate Citizenship 2009
31
Figure 17
Partnerships for solutions
Question asked: Do you partner with any of the following to solve social or environmental problems?
Please select all that apply.
Combined
mentions
Total
Charitable organizations
Customers
Breakdown by company size - 2009 only
Small
Medium
Large
37%
51%
64%
27%
40%
42%
21%
41%
41%
22%
31%
33%
14%
28%
33%
7%
25%
29%
4%
12%
16%
36%
17%
10%
45%
33%
Schools
29%
Industry peers
Suppliers
26%
21%
Regulators
15%
NGOs
8%
Don't know/no answer
continuedtoshowstrongersupportforarts
andculturecomparedtolargeandmid-size
companies(seeFigure16).
Companies are partnering with other
organizations and businesses
Toaddresssocialandenvironmentalproblems,companiesarepartneringwithcharitableorganizations(45percent),customers(33
32
State of Corporate Citizenship 2009
27%
percent),schools(29percent)andindustry
peers(26percent).Thetopthreereasonsfor
establishingsuchpartnerships:toimprove
reputation(79percent),toobtainfinancial
benefitsbyidentifyingopportunitiesforinnovation(69percent),andbecausethecompany
couldnotsolvetheproblemsalone(64percent)(seeFigure18).It’snotjustaboutdoing
therightthing(amotivationfor3percent)
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
orgivingbacktothecommunity(2percent).
Companiesarelookingforinvolvementwith
impact,insideandoutsidethebusiness.
The recession squeezed business support
for economically distressed communities
Businessinvolvementwitheconomicallydistressedcommunitieshasbeenconstrained,
withlittlegrowthandsomedecline.Most
companies(72percent)havekeptthesame
levelofinvestmentinthesecommunities,
andpurchasesfromminority-ownedand
women-ownedsuppliershavegenerallybeen
maintained(seeFigure19).Somedecreases
arefoundin:
• Hiringpeoplefrompoorcommunities,18
percentcomparedto23percentin2007;
• Locatingcompanyfacilitiesorjobsin
economicallydistressedcommunities,12
percentcomparedto15percentin2007;
• Offeringjobtrainingprogramstopeoplein
economicallydistressedcommunities,12
percentcomparedto18percentin2007;
• Providingtraininganddevelopmentopportunitiesforlower-wageemployees,26
percentcomparedto31percentin2007.
Figure 18
Where is the value in partnership?
Question asked: Why did you become involved with a partner to solve social or environmental problems?
Please select the top three reasons
Combined
mentions
Total
Improve our reputation
To obtain financial benefits by identifying
opportunities for innovation
Our company could not solve the problems alone
Government or other policy incentives
Pressure from external stakeholders
www.BCCorporateCitizenship.org
Breakdown by company size - 2009 only
Small
Medium
Large
79%
78%
78%
69%
74%
62%
67%
68%
54%
20%
44%
60%
10%
14%
21%
79%
69%
64%
35%
14%
State of Corporate Citizenship 2009
33
Figure 19
Support for economically distressed communities
Question asked: To what extent is your company involved in any of the following?
■ 5-Very large ■ 4-Large ■ 3-Moderate
■ 2-Small
■ 1-Not at all ■ Don’t know
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
Providing training and development opportunities
for your lower-wage employees
2009
10%
2007
11%
16%
26%
14%
17%
27%
20%
Small
33%
0%
25%
1%
25%
1%
Medium
Large
15%
36%
46%
22%
17%
37%
18%
15%
36%
12%
25%
30%
11%
23%
31%
7%
20%
22%
7%
18%
27%
Purchasing from women-owned suppliers
9%
2009
2007
32%
15%
10%
18%
36%
14%
16%
22%
2%
Purchasing from minority-owned suppliers
8%
2009
13%
2007
18%
35%
15%
28%
19%
32%
24%
1%
2%
7%
Hiring people from poor (economically distressed)
communities
7%
2009
11%
2007
33%
34%
14%
27%
21%
24%
18%
0%
1%
9%
Improving conditions in economically distressed
communities
5%
2009
24%
12%
2007
26%
32%
1%
21%
32%
1%
26%
13%
7%
Locating your company’s facilities or jobs in
economically distressed communities
4%
2009
8%
2007
10%
20%
21%
45%
22%
20%
42%
1%
2%
5%
Offering job training programs to people in
economically distressed communities
3%
2009
9%
2007
12%
20%
21%
21%
20%
46%
1%
40%
2%
6%
34
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Therearesomesignificantdifferencesby
companysize.Whilesmallcompanieshave
reducedsupport,largecompaniesinmany
caseshavemaintainedorincreasedsupport
foreconomicallydistressedcommunities:
• Hiringpeoplefrompoorcommunities
increasedfrom23percentin2007to30
percentin2009;
• Involvementinimprovingconditionsin
economicallydistressedcommunities
increasedfrom29percentto31percent;
• Providingtraininganddevelopment
opportunitiesforlower-wageemployees
increasedfrom43percentin2007to46
percentin2009.
Despite layoff pressures, companies are
maintaining support for employees
Numerouspublicstudieshavefoundthat
treatingemployeeswellisoneofthemost
importantcriteriafordemonstratinggoodcorporatecitizenship(GolinHarris2008;Fleischman-Hillard/NationalConsumersLeague
Study2007;GlobeScanMonitor2008).Asin
2007,81percentofthe2009surveyrespondentssayvaluingemployeesandtreating
themwelliscriticalorveryimportant.Such
practicesimprovecompanyreputation,morale
andproductivity,helptoattractandretaintop
talentandreduceturnovercosts.
Despitethescaleofrevenue/profitdecline
andlayoffs,executivesfromU.S.companies
ofallsizesreporttheyhavemaintainedsupportforremainingemployees(seeFigure20):
• 60percentofallcompanies(68percentof
largecorporations)supportwork/lifebalancepracticesforallemployees,compared
www.BCCorporateCitizenship.org
to46percentofallcompaniesin2007;
• 45percentofallcompaniescompensate
employeesforideasthatbenefitthebottom
lineandtheenvironmentorcommunity,
comparedto37percentin2007;
• Largeandmid-sizecompaniesincreased
theirofferingofhealthinsurancetoall
employees,includinghourlyworkers,from
76percentto91percentforlargecompanies,andfrom77percentto87percentfor
mid-sizecompanies.
Morethanhalfofthecompanies(51percent)
reporttheyaresupportingskilldevelopment,
educationandcareeradvancementofexisting
workerswhoearnlessthan$40,000ayear.
Largeandmedium-sizecompaniessupport
theseworkersatamuchhigherrate(69percentand65percent,respectively)thansmall
companies(seeFigure20).Thiscommitment
appearstoendureacrosseconomichard
times.Companysupportforskilldevelopment,educationandcareeradvancementis
almostashighforcompaniesfacinggreator
moderatedeclinesinsales/revenuesasthose
benefittingfrommoderateorgreatincreases.
The596executiveswhoreportedtheircompaniessupportskilldevelopment,education
andcareeradvancementforemployeesmakinglessthan$40,000saytheyareprimarily
motivatedbyadesiretoimproveproductivity
(54percent),reduceturnover(44percent),
orfillskillshortages(28percent).The156
executiveswhoreportedtheircompaniesdo
notsupportskilldevelopment,education,and
careeradvancementforthisgroupsaythat
eithertheydonotneedchangestomeetskill
needs(45percent)orhaveinsufficientbudget
orpersonneltoprovidetraining(42percent).
State of Corporate Citizenship 2009
35
Figure 20
Employees and workplace practices
Question asked: Next are some questions about employees and workplace practices.
To what extent is each of the following true of your company?
Please use a scale of 1 to 5 where 1 means “not at all true” and 5 means “very true”.
■ 5-Very true ■ 4
■3
■2
■ 1-Not at all true ■ Don’t know
We hire women and/or minorities in management
positions
5% 8%
2009
2007
37%
1%
15%
23%
48%
Small
Medium
Large
65%
79%
84%
56%
65%
68%
34%
87%
91%
39%
65%
69%
41%
44%
57%
1%
21%
26%
Breakdown by company size - 2009 only
% = responses of 4 and 5 on 5-point scale
6% 9%
We support work-life balance practices for all
employees, including hourly workers
8%
2009
2007
32%
28%
18%
22% 10%
1%
30% 12% 11%
2%
28%
Our company offers health insurance coverage to
employees, including hourly workers
6%
2009
45% 11% 10%
2007
40%
14%
16%
28%
0%
24%
1%
5%
We support the skill development, education and
career advancement of existing employees earning
less than $40,000 annually
2009
24%
27%
22% 10%
17%
1%
We compensate employees for ideas that benefit the
bottom line and the environment or our community
at the same time
2009
2007
36
20%
14%
25%
23%
26%
27%
12%
14%
State of Corporate Citizenship 2009
16%
1%
20%
2%
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Large companies sustain volunteering as
a staple of community involvement
Largecompanies’supportforemployeevolunteeringin2009wasstrongwith83percent
ofrespondentsstatingtheircompaniessupportemployeevolunteeringintheircommunity.Mostofferorganizednon-skilledvolunteering(67percent)andpro-bono/skill-based
volunteering(60percent).Thetopthree
reasonsforprovidingemployeevolunteering
accordingtotherespondentsinclude:
• Improvingpublicrelations,brandingand
reputation,55percent;
• Improvingjobsatisfactionandretention,
42percent,and;
• Supportingemployeeteambuilding,35
percent.
Forprivatelyheldlargecompaniesthesecond
mostimportantreasonforsupportingvolunteering,afterimprovingPR,brandingand
reputation(55percent),ishelpingemployees
buildrelationshipswithimportantcommunitystakeholders(35percent).
www.BCCorporateCitizenship.org
Employee volunteering in large companies
Question asked: In what ways do you support
employee volunteering? Please select all that
apply.
Combined
mentions
Offer company organized non-skilled
volunteering
67%
Offer company organized pro-bono/skill-based
volunteering.
60%
Offer “Dollars-for-doers” grants (grants to
nonprofits where individuals or teams of employees volunteer)
29%
Provide nonprofit board placement
28%
Offer sabbatical volunteer programs
25%
Offer loaned executives to nonprofits/NGOs
19%
Offer opportunities for employees to travel to
another country to volunteer
17%
Other
5%
Question asked: Why do you offer volunteer programs to your employees? Please select the top
two most important reasons.
Combined
mentions
To improve public relations, branding and
reputation
55%
It improves job satisfaction and retention
42%
To support employee team building
35%
To help employees build relationships with important community stakeholders
32%
To support employee skill building
12%
It is an effective recruiting tool
5%
It helps improve sales
5%
It is the right thing to do
2%
Don’t know/Not available
3%
State of Corporate Citizenship 2009
37
Boston College Center for Corporate Citizenship
Citizenship gap between large and small companies
Oneofthefindingstoemergecomparingthe
resultsofthe2007and2009surveysisthe
growingcitizenshipgapbetweenlarge(1,000
ormoreemployees)andsmall(lessthan100
employees)U.S.-basedcompanies.
Inseveralareas,thesurveyshowslarge
companiesin2009significantlyincreasing
theirinvestmentsandinvolvementincitizenshipactivities.Smallcompaniesregistered
modestimprovementsormoreorlessstayed
thesame.Thiswasespeciallynotableinthe
managementofcorporatecitizenshipwhere
manymorelargecompanieshadpolicies
aboutcitizenship(increasingfrom55percent
in2007to65percentin2009),incorporated
The citizenship gap in executives’ attitudes
grows between large and small U.S. companies.
Small cos. %
The importance of…
2009
2007
2009
2007
Improving conditions in your community
44
53
63
59
Responding to community interest groups
regarding issues they care about
35
45
52
51
Protecting the environment
46
50
62
53
Providing employee benefits
59
69
72
69
Building employee diversity
37
43
71
65
Supporting employee volunteerism
33
42
54
54
Marketing and advertising products and
services responsibly
59
69
71
70
2009
2007
2009
2007
61
69
81
83
Overall importance…
Corporate citizenship needs to be a priority
for companies
38
Large cos. %
State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
citizenshipintotheirbusinessplans(from
46percentto61percent),andreportedtothe
publiconcitizenshipissues(from45percent
to59percent).
Inotherareas,adifferentpatternemerged.
Whilelargecompaniesweremorelikelyto
respondtotheeconomicpressuresofthe
recessionwithlayoffs,theymoreorlesskept
ontrackwithcorporatecitizenshipactivities.
Incontrast,smallfirmsstayedcommittedto
theircorporatecitizenshippriorityoftreatingemployeeswellbyminimizinglayoffs,
butsignificantlydecreasedtheiremphasison
otheraspectsofcitizenship.
Thiswasespeciallyevidentinhowtheir
citizenshipprioritiesin2009variedfrom
thosein2007(seechartatleft).Forexample,
fewersmallcompanyexecutivessurveyedin
2009stressedtheimportanceofimproving
conditionsintheircommunities–a9percent
decrease–andofrespondingtocommunityinterestsaboutissuesofconcern–a10
percentdecrease.Smallfirmsalsoputless
stressonprovidingemployeebenefits(10
percentdecrease)buildingemployeediversity
intheirworkforce(6percentdecrease)and
supportingemployeevolunteerism(9percent
decrease).Onthegreenagenda,slightly
fewersmallfirmssawthisascriticalorvery
important(4percentdecrease)whereasmany
morelargefirmsemphasizedit(9percent
increase).Onestatisticseemedtoexemplify
thisoverallpattern:Morethan80percentof
largecompanyexecutivesin2007andagain
in2009agreedthatcorporatecitizenship
needstobeapriorityforcompanies.Inthe
caseofsmallcompanies,fewersupportedthis
propositioninthelatestsurvey,decreasing
from69percentto61percent.
www.BCCorporateCitizenship.org
Arethesedifferencesattributabletoagreater
commitmenttocorporatecitizenshipbylarge
companiesordidthefinancialcrushofthe
recessionhavemoreofanegativeimpacton
smallcompaniesandlessentheprioritythey
gavetocorporatecitizenshipinvestments?
Researchersfirstexaminedwhetherornot
smallfirmssufferedgreaterrevenuelosses
thanmid-sizeandlargefirms.Thefindings
showedthattherewerenodifferencesinrevenuedecreasesbetweensmall,mid-sizeand
largefirms.42Thisallowstestingtheindependentimpactoftheeconomyversuscompany
sizeasacontributortocorporatecitizenship
investments.
ThechartonPage40highlightstheresults
oftheseanalyses.35Itshowsthatregardless
ofcompanysizetheeconomicimpactofthe
recessionhadasignificantindependenteffectoncorporategivingandphilanthropyin
2009,andincorporateinvestmentsintraininginlow-incomecommunitiesandfortheir
ownlow-incomeemployees.Allcompanies
sufferinganegativeeconomicimpactgave
significantlylessmoneyandspentlesson
trainingintheseregards.
However,theeconomyalonewasnota
significantpredictorofwhetherornota
companyhiredpeoplefrompoorcommunitiesorworkedtoimproveconditionsin
41Taking into account increased layoffs and reductions in hours,
wages, and benefits, it could be argued that large firms absorbed
a more negative economic impact than smaller ones. Yet studies
consistently find that larger company size provides more of a buffer in a downturn. Smaller firms have fewer resources to draw on
to weather a recession.
52The statistical analyses tested the impact of economic conditions
on companies, controlling for firm size, and the impact of size,
controlling for economic impact.
State of Corporate Citizenship 2009
39
Boston College Center for Corporate Citizenship
Corporate philanthropy and community investments
Differences based on company size and the impact of the economy
Company
size
Impact of
economy
Philanthropy/giving versus past year
√
√
Hiring people from poor (or economically distressed)
communities
√
Improving conditions in economically distressed
communities
√
Locating your company’s facilities or jobs in
economically distressed communities
√
Offering job training programs to people in
economically distressed communities
√
√
Providing training and development opportunities
for your lower-wage employees
√
√
Purchasing from minority-owned suppliers
√
Purchasing from women-owned suppliers
√
√ = Significant predictor of citizenship activity in 2009
thosecommunities.Nordiditpredictdifferencesinpurchasingfromminority-ownedor
women-ownedsuppliers.Inalloftheseareas
ofcommunityoutreach,sizewasthekey
differentiator.Bigcompaniesdidmoreand
smallonesless,independentoftheimpactof
theeconomyontheirbusiness.
40
State of Corporate Citizenship 2009
Theanalysesfoundthatbothcompanysize
andeconomicconditionshadasignificanteffectonphilanthropyandjobtraining.Inthese
areas,smallcompaniesoverallgaveanddid
less.Thosecompaniessufferingmostfrom
therecessiongaveanddidevenless.Byextension,charitiesandlocalcommunitieslooking
forsupportfromsmallbusinessexperienced
a“double-whammy.”
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
Bycomparison,morelargefirmschoseto
“staythecourse”whenitcametocorporate
citizenship.Evenastheyscaledbacktheir
philanthropy,bigfirmscontinuedtoputa
priorityoncitizenship,promoteemployee
volunteerismand,wheretherewasahistory
ofdoingso,attendtoneedsoflow-income
communities.Onewaytodescribethepattern
inbigcompaniesisthroughthestrategic
logicof“shrink-and-grow.”Bigfirmsshrank
theirworkforcethispastyear,asthey’vebeen
doingforthepastthreedecadeswhenprofit
pressuresarise.Butatthesametime,they
grewmoregreenproductsandprogramsand
upgradedthemanagementofcitizenship
withinthefirm.
www.BCCorporateCitizenship.org
Importance of citizenship priorities
Financial impact of recession
Small company
trends
Strategic impact of
recession
What’sthebestwaytointerprettheeffectof
theeconomyandcompanysizeoncorporate
citizenshipin2009?Itcouldbethatthe
recessionhadamaterialandpsychological
impactoncorporatecitizenshipthatledsome
smallfirms“backtothebasics”whenitcame
totheirphilanthropy,communitysupportand
theprioritygiventocorporatecitizenship.
Atthesametime,smallfirms(14percent)
werefarlessaptthanbigones(54percent)to
layoffemployees.Andfrom2007to2009,
attentiontowork/lifebalanceandtotalking
aboutcitizenshipwithemployeesincreased
insmallcompanies.Perhapsthebestwayto
expressthesmallcompanymindsetinthe
recessionisthat“citizenshipbeginsathome.”
Large company
trends
Back to the basics
Stay the course
Less support for
charity and for
low-income communities. Less of a
priority on improving communities,
supporting volunteering, and on
citizenship overall.
Less charity but continued support for
low-income communities. Continue to
emphasize community improvement,
employee volunteering, and corporate
citizenship overall.
Citizenship begins
at home
Shrink-and-grow
Retain staff, be good
citizens toward employees, and ‘stick
to the knitting.’
Reduce staff, upgrade management
of citizenship, reach
out to stakeholders,
and go green.
State of Corporate Citizenship 2009
41
Boston College Center for Corporate Citizenship
The future of corporate citizenship
Corporate citizenship will continue to
move into the core of business strategy
and practice
Somethoughtcorporatecitizenshipwould
quicklydropfromU.S.executives’radarin
thefaceoftheworsteconomicrecessionsince
theGreatDepression.Infact,morethanhalf
ofU.S.seniorexecutivessaidinthe2009
StateofCorporateCitizenshipsurveythat
corporatecitizenshipisevenmoreimportant
inarecessionandmostnowunderstandthe
valueofcorporatecitizenshipasabusiness
driverandnotsimplythe“right”thingtodo.
Moreinvestmentisbeingmade–particularly
bylargecompanies–inestablishingcorporatecitizenshipmanagementpolicesand
practicestoensurecitizenshipisintegrated
intothecorebusiness.Thisisparticularly
trueintheenvironmentaldimensionof
corporatecitizenshipwhereexecutivessee
agrowingmarketforgreenproductsand
services.Thesebusinessleadersareactively
workingtoincreasetheirbrandawarenessas
“green”whileusingenvironmentallyresponsiblepracticestocutcoststhroughimproved
materialsefficiency.
The next frontier for corporate citizenship
is public policy
Publicopinionpollingdataclearlyindicate
thatpublicexpectationswillcontinuetorise
forbusinesstodomoretoaddressdomestic
andglobaleconomicandsocialchallenges.
The2007StateofCorporateCitizenship
surveyshowedthatbusinessleaderswere
42
State of Corporate Citizenship 2009
fullyawareoftheseexpectationsandthe
changingroleofbusinessinsociety.Theyalso
recognizethatexistingmodelsforaddressingthesechallengesthroughgovernmentare
insufficient.In2007thesurveyshowed60
percentofbusinessleadersthoughtAmerica’s
contractwasfundamentallybrokenandin
needofamajoroverhaul.Thisyear’ssurvey
revealedbusinessleadersrecognizebusinessneedstobeanactiveplayerinaddressingsociety’sproblemsandshouldbemore
involvedinaddressingmajorpublicpolicy
issuesfromhealthcaretoclimatechange.
Thechallengeforcompaniesastheyengage
inthepublicpolicyarenawillbetoseparate
theirimmediateselfinterestandinterestof
theirshareholdersfromthebroaderinterestsofsocietyandtheirroleas“corporate
citizens.”Thecurrentpublicdebateonthe
futureofhealthcareandtheroleoftheprivateinsuranceindustryisagoodillustration
ofwherebusinesscanbeseenasbothapart
oftheproblemandpartofthesolutionfroma
publicpolicyperspective.
Thesepublicpolicyissueswillraisenew
corporatecitizenshipquestionsforcompanies
aboutunderstandingandmanagingtheir
overallimpactonsociety.Itisinterestingto
note,forexample,thatwhilelargecompanies
keptuptheir“citizenship”philanthropiccontributionsandstrengthenedcommitmentsto
employeevolunteerism,theyalsoresponded
totheeconomiccrisisbycuttingtheirwork
forces.Incontrast,smallbusinessesappearto
haveresistedjobcutsattheexpense,arguably,ofphilanthropicandother“citizenship”
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
activities.Thequestionis,whichresponse
createsabetteroutcomeforsociety.Itisthese
kindsofquestionsthatlargecompaniesin
particularmustaddressastheyengagemore
deeplyinpublicpolicymaking.
Accountability and governance issues will
continue to dominate the agenda
Noissueismorecentraltothenotionofcorporatecitizenshipthaneffectivegovernance
toensureaccountabilityofthefirmtosociety
anditsowners.Itisthefailureofgovernance,
particularlyinthefinancialsector,thatmany
seeastheprimeculpritintheeconomiccrisis.Thisperceptionofcorporatemismanagementandselfinterestcoupledwithexcessive
compensationwithinsufficientaccountability
has,morethananyothercorporatecitizenshipissue,turnedpublicopinionagainst
business.
Notsurprisingly,mostbusinessexecutives
donotseemoregovernmentregulationand
oversightasthebestoronlywaytoaddress
governancefailures.Theybelievebusiness
leadersthemselvesneedtotakemoreresponsibilityforaddressingthesefailures.
Whilehonestlyexpressed,thesesentiments
willdolittletoassuageapublicthathaslost
trustinbusinessandhasheardthesame
promisesaftereveryscandalandcrisis,such
astheEnrondebacleoflessthanadecade
ago.Whatspecificassurancecanbusiness
leadersofferthattheycanputtheirown
houseinorderonthegovernancefront?At
thesametime,itiscleargovernmentregulationaloneisnotsufficientaslongasthereare
corporateleaderswillingtobreakthelawand
evenignoretheinterestofshareholderslet
alonesociety.
www.BCCorporateCitizenship.org
Thechallengeforbusinessleadersisto
engageconstructivelywiththenewadministrationinWashington,andleadersfromcivil
society,tocreateaframeworkforcorporateresponsibilitythatbringstogetherethicalleadership,selfregulationandregulationtocreate
aviableplatformforcorporateresponsibility
andaccountabilityinaglobaleconomy.
Is capitalism 2.0 possible?
Inrecentyearsandinresponsetothecurrentcrisistherehasbeenmuchtalkabouta
“kindercapitalism”orcapitalism2.0through
whichbusinesswilltakemuchgreaterresponsibilityforitsconductandimpactonsocietyandworkactivelywithgovernmentsand
civilsocietytoaddresssocialchallengesinthe
UnitedStatesandglobally.Toachievethiswill
requirebusinessleaderstomovewellbeyond
traditionalnotionsandmodelsofcorporate
citizenshipbasedprimarilyonphilanthropy
tolookholisticallyattheroleandimpactof
businessonsocietyandengageactivelyin
bringingtheirassetstobearonaddressing
society’schallenges.
Thegoodnewsinthe2009StateofCorporateCitizenshipisthatbusinessleadershipin
Americaseemsfullyawareofthechallenges
aheadandthenewmarketsandbusiness
opportunitiesthatwillemergeifcompanies
embracethosechallenges.
State of Corporate Citizenship 2009
43
Boston College Center for Corporate Citizenship
References
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State of Corporate Citizenship 2009
www.BCCorporateCitizenship.org
Learning, Practice, Results. In Good Company
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State of Corporate Citizenship 2009
45
Learning, Practice, Results.
In Good Company.
The Boston College Center for Corporate Citizenship is a membership-based
research organization associated with the Carroll School of Management. It is
committed to helping business leverage its social, economic and human assets
to ensure both its success and a more just and sustainable world. As a leading
resource on corporate citizenship, the Center works with global corporations to
help them define, plan and operationalize their corporate citizenship. Through
the power of research, management and leadership programs, and
the insights of its 350 corporate members, the Center creates knowledge, value,
and demand for corporate citizenship. www.BCCorporateCitizenship.org
The Hitachi Foundation is an independent nonprofit philanthropic organization
established by Hitachi, Ltd. in 1985. We believe that business has an essential
role to play in addressing the many complex global challenges of our time. The
Foundation’s mission is to forge an authentic integration of business actions
and societal well-being in North America. Our strategic focus through 2013 is
to discover and expand business practices that create tangible and enduring
economic opportunities for low-wealth Americans, their families, and their
communities. Our three programs – Business and Work, Hitachi Community
Action Partnership, and the Yoshiyama program – help us discover what can
be done to make the pursuit of profit in business and the pursuit of healthy
communities a symbiotic endeavor. www.HitachiFoundation.org
Boston College Center for Corporate Citizenship 55 Lee Road, Chestnut Hill, MA 02467
Phone 617-552-4545 Fax 617-552-8499 Email ccc@bc.edu Web site www.BCCorporateCitizenship.org