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Are employees your greatest impact washing risk?

Over three quarters or 77% of consumers recently surveyed for corporate PR firm SEC Newgate's ESG Great Disconnect Monitor, agreed that companies have a responsibility to behave like a good citizen and 60% agree companies should penalised for inaction on environment, social and governance issues.

Research from BrandFog found that almost two thirds or 64% of consumers thought CEOs should speak up about major issues, particularly from the companies they buy from, while 93% said they’ll buy more of a firm’s product if they agreed with the view of its CEO.

This is particularly important for recruiting and retaining talented employees, the study highlighted 82% believe that as an employee it is important to know their CEO’s position on social issues.

Business leaders are already aware of this with many internalising the importance of company purpose. However, this instantly raises the risk of accusations of hypocrisy; does the company and its leadership follow these values or is it all sloganeering and box ticking?

This is where company bosses can get caught out.

A great example of this is one of my favourites - the Gender Pay Gap Bot, which every International Women’s Day shines a spotlight on those firms celebrating their female employees, only to be shot down by the bot tweeting its (publicly available) gender pay gap data. The bot then compounds corporate embarrassment by tweeting when the perpetrator’s boastful tweet is taken down.

This “impact washing” or “purpose inflation” does not fly with employees - who are often amongst the sophisticated, connected and passionate stakeholders. So how do companies and organisations avoid falling into the impact washing trap?

There are a few essential things to consider and actions to take:

Data, data and more data

  • Leadership needs to demonstrate tangible and measurable impact on targeted social issues that matter to their employees.
  • When it comes to positive impact claims is there the data to back it up?
  • Share specific examples of how social initiatives have delivered with tangible and measurable positive impacts and share that with employees across internal communications channels.

    Tenure
  • Consider how long these initiatives have been in place. Employees want to know this is not just a “flash in the pan”. Demonstrate there is a decent track record of engaging in whatever the social or environmental initiative that there is in place and share that information with internal stakeholders.

    Partnerships
  • Review the non-profits you are aligned with. How can your partnership deepen? What more can you bring to the partnership and what more can the partnership offer to your employees? e.g. volunteering opportunities, secondments, pro-bono committee positions.

    Company code
  • Consider creating a company code of conduct relating to ESG matters that can be updated to include updates on engagement in social initiatives, disclosure of financial contributions, impact assessments and progress.

    Demonstrate care
  • If the firm is truly engaging with internal stakeholders consider how to demonstrate those views are folded into company strategy.
    This is a powerful way for people to feel their voice matters in shaping the mission of the company.

What issues should a company engage on?

When thinking about what to speak out about a company needs to consider how much the issue matters to internal and external stakeholders; whether it could have an impact if it speaks out on an issue and most importantly, whether by not taking action the issue at hand is going to impact its ability to do business.

Social, or impact washing, has emerged as the new greenwashing. Getting it right is hugely important for businesses to maintain their reputation, build trust, and secure consumers, attract, retain and grow its workforce.

By adopting a sincere commitment to social responsibility and avoiding the temptation to merely project a positive image, companies can become agents of meaningful change and contribute to a better future for all – investors, customers and employees.

This PRmoment Internal Comms Review is written by Naomi​ Kerbel, Director, Communications, SEC Newgate.

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