In a material world the consumer is king (or queen) and today's consumer wants to feel good about what they are purchasing or investing in. The 'benevolent halo' effect is where consumers and investors trend towards picking companies and brands that socially responsible e.g. using recycled or compostable packaging, donating to charities or environmental efforts or are carbon neutral etc.
The 'conscious consumer' wants to feel good about their choices and that can directly impact your company's bottom line. The more in-line your efforts are with your company values the better, because consistency is right up there in earning and maintaining your social licence.
I urge businesses wary of the covid pinch, to consider the signal retreating from CSR (corporate social responsibility) spending sends their investors and consumers. I must emphasise that I'm referring to companies here who are acting with precaution, not businesses that are actually struggling.
For investors dropping your CSR efforts is a solid sign your not a good investment and for consumers it signals that you don't really value what you said you did. Value alignment being core component of your social licence.
The more integrated your CSR behaviour and efforts are into your business the better. As Shannon Schuyler, the chief corporate responsibility and purpose officer at Price Waterhouse Coopers and lecturer on social impact, says “Today, if you’re inconsistent, you’re toast. You’ve got to stand for something, and you have to make sure that your behaviors and your values guide you through the decision-making process.”
It's important to understand that corporate philanthropy and goodness is not just good for the communities they operate in - it's good for their bottom-line. If done right it should be really difficult to disentangle from. It is more a way of being and doing than some tokenism on the side. Integrated CSR speaks to your company's authenticity and the benefits tend to be more substantial.
The halo effect for businesses who invest in CSR is real because people remember how you make them feel and doing is more powerful than lip service. CSR done right builds trust, which your social licence is measured on and that is ultimately earns you consumer preference.