Social responsibility has HR benefits too

A study finds that leaders consider social responsibility as a good tool for employee engagement


The survey found that across all leadership levels, only 36% of employees are highly engaged. But linking a firm’s social responsibility efforts to leadership development can improve employee engagement and performance, said 87% of respondents. Photo: Abhijit Bhatlekar/Mint
The survey found that across all leadership levels, only 36% of employees are highly engaged. But linking a firm’s social responsibility efforts to leadership development can improve employee engagement and performance, said 87% of respondents. Photo: Abhijit Bhatlekar/Mint

Linking a firm’s social responsibility objectives with leadership development can improve employee engagement, says a global study released by the Hay Group division of the world’s biggest executive search firm Korn Ferry on 31 March.

The new finding comes at a time when human resources (HR) managers are trying hard to keep employees engaged with the firm’s objectives. From higher compensations to learning assignments and cool work environment, companies these days stop at nothing to ensure their staff remains engaged.

The survey—carried out among 7,500 business and HR leaders in 107 countries—found that across all leadership levels, only 36% of employees are highly engaged. But linking the company’s social responsibility efforts to leadership development can help reverse this trend, and improve employee engagement and performance, according to 87% of the survey respondents.

The trend seems to be already catching up as 59% of the respondents said their organizations are trying to do so. For companies too, leaders who are socially responsible adds to a great advantage.

Adil Malia, group president HR at Essar Group, said leaders who are socially engaged come with greater maturity and a heightened ability to inspire. “When you are socially engaged, it shows that you were inspired to create a change. And at workplace, only an inspired individual can help further create more inspired employees,” said Malia.

When leaders are able to reach out to stakeholders outside the business, their ability to connect with the consumer is also that much higher, he added, calling it value creation in an enterprise through values.

For Sucharita Palepu, global head of people policies and practices at Tech Mahindra Ltd, social responsibility is a key engagement tool. “Socially responsible employees end up having an emotional connect with the organization and that results in greater loyalty,” she said.

These advantages have made corporate social responsibility or CSR an area of high interest for the leadership. In India, most CSR committees are headed by the chairmen and chief executives of companies.

“I think leadership level take special interest in CSR because they have used their skills to transform businesses and they want to see how they can now employ it to transform society,” said Santhosh Jayaram, head of CSR and sustainability at KPMG, a consultancy firm that advises many companies on their CSR strategy.

Also, it offers them a chance to engage with different stakeholders and even strike deep relationships with their own colleagues. That’s why most CSR initiatives will have the fingerprints of the top leadership, said Jayaram.

“If an organization wants to win the current war for talent and retain valuable employees, then it needs to ensure that they constantly feel inspired. Employees need to view themselves as part of a big picture and this is where the social responsibility platform can help,” said Nitin Razdan, country head for Korn Ferry Hay Group.

Even when it comes to hiring, leaders who have been engaged socially score over others. Malia of Essar Group said when a person is socially responsible, it is a sign of a mature leader who understands the reality of the market.

“When we hire we are mindful about this, and prefer a leader with a socially responsible bent of mind,” he added.

It is not just leadership. Even students from B-schools prefer joining companies that have a culture of social responsibility.

A study of more than 3,700 students at 29 top business schools such as Yale, Insead, London Business School and Indian Institute of Management Bangalore, found that corporations unwilling to act on environmental issues are not favoured by the men and women whom they like to recruit. About 20% of respondents expressed an unwillingness to work for companies with bad environmental practices regardless of salary considerations.

In fact, 44% of students were even willing to accept a lower salary to work for a company with better environmental practices, the study said.