Focus on CSR: CSR’s Business Benefits
CSR Can Help You Reduce Your Labour Costs and Improve Productivity
Labour shortages are a reality for the construction industry, and as the industry adopts new technologies to improve productivity and project quality, companies will have to increasingly compete with other industries for technically-savvy workers. According to research, the construction industry will need to find some 322,000 new workers by 2024 to replace those retiring and keep pace with rising demand in the sector. (Source, page 5) So, whatever you can do to attract, retain and motivate employees can go straight to your bottom line. Here’s how:
Generic research (not specific to the construction sector) finds that strong CSR performance increases the commitment and engagement of employees. This in turn enhances job performance, increases productivity, reduces turnover, lowers absenteeism, and even reduces the incidence of employee corruption.
The potential HR value which CSR can generate:
- Reduces employee turnover rate over time by 25 – 50 per cent
- Reduces the annual employee quit rate by 3 – 3.5 per cent
This can save replacement costs up to 90 – 200 percent of an employee’s annual salary for each position that stays. By reducing turnover due to its CSR investments, a company can reduce replacement costs, including costs during the period the position is vacant, costs of hiring and onboarding, and lost time during formal and informal training periods.
- Improving CSR performance has the same effect on retention as an increase in annual salary of $3,700 per year
- Firms higher in CSR are perceived as more attractive employers than firms lower in CSR. Prospective applicants’ job pursuit, probability to interview, and probability to accept a job offer are positively associated with a firm’s CSR performance
- Firms with higher CSR increase employee engagement by 7.5 per cent. One estimate shows that a company with six employees could see an increase of $6,300 over 3 – 5 years, due to overall productivity increases from CSR
- 86 per cent of workers believe it is important that their own employer is responsible to society and the environment, with over half (55 per cent) feeling that it is “very important”
- 75 per cent would recommend their company if they feel it is environmentally responsible vs. 43 per cent if it is not
- 71 per cent want to work for a company whose CEO is actively involved in corporate responsibility and / or environmental issues
- 53 per cent of workers said that “a job where I can make an impact” was important to their happiness
By 2020 millennials will be 50 per cent of the workforce. Here are their thoughts on CSR:
- 72 per cent of millennials said “a job where I can make an impact” was important to their happiness
- 80 per cent want to work for a company that cares about how it impacts and contributes to society
- 61 per cent would prefer to work for a company offering volunteering opportunities
- 55 per cent said that the company’s “cause work” influenced their decision to accept an offer
- 3 in 4 believe corporations should create economic value for society by addressing society’s needs
Millennials are known for their interest in working for organizations that align with their values. According to Deloitte research, almost nine in ten (87 per cent) believe that “the success of a business should be measured in terms of more than just its financial performance”.
To learn more, download Corporate Social Responsibility in the Canadian Construction Sector: A Practical Guide to CSR from the Member login section.