Don’t mention ‘CSR’ when talking to SMEs!

Tom attended a conference on ‘Responsible Business’ in December 2013. EG magazine asked him for his thoughts on the outcome…


Writing my book ‘Partners for Good’ a couple of years ago I discovered just a few good examples of mission-driven, genuine collaborations between small businesses and local charities based on a win-win business case. Given that 99 per cent of all businesses in Britain are SMEs you might have expected I would have found more. Was this because small businesses didn’t care, because small charities didn’t know how to forge partnerships or because the business case for such collaboration never gets made?

Or is it simply because SMEs and charities speak in different tongues?

So I took a closer look and in some research funded by the Joseph Rowntree Foundation I compared SME/community engagement in Bradford and York, two cities with significantly different economies. I was surprised to find a healthy (though not overpowering) level of engagement in both – but it was non-strategic, superficial, reactive rather than pro-active and generally not supported by a business case. More to the point, most companies did not recognise that helping the odd charity occasionally was ‘community engagement’ and the phrase ‘corporate social responsibility’ never passed their lips.

Previous research suggests that when confronted with the term ‘corporate social responsibility’ smaller businesses actually reacted negatively: ‘we don’t have the time or resources for the sort of thing’; ‘we’re not that sort of company’; ‘CSR is for the big boys, not us’. And yet, as my work confirmed, SMEs not only did regard themselves as members of the community but overwhelmingly thought they could do more in that role. This is confirmed by a recent study by Sheffield Hallam University for NAVCA.

The business case for community engagement by corporates is that such activity enhances the company’s reputation (brand loyalty, recognition, sales) and its employee engagement. This in turn leads to greater staff loyalty, lower recruitment and training costs, greater productivity and innovation. All of these benefits could apply to SMEs too – and yet the casual use of the term ‘CSR’ appears to be a real barrier to collaborative thinking.

There is no shame in asking ‘what can community engagement deliver to my business?’ and SMEs should ask this of themselves. Rather than being asked for the odd raffle prize, asking ‘what can my business and this local charity do for each other?’ is a real start to creating strong, sustainable and mutually beneficial relationship in which the business is a power for good in the local community.