You Get What You Give: how CSR can improve staff morale

Facing a recession and climbing bills, the focus for many SMEs this year is preserving cash flow by limiting unnecessary spending. But often, these so-called ‘unnecessary’ spending areas can turn out to be vital to survival in a poor economy.

Take employee engagement. In light of sizable public strike action and a record drop in real wages, this concept could now be the thread holding workforces together.

Luckily, more companies are waking up to the importance of having good staff satisfaction, and investing in Corporate Social Responsibility (CSR). The idea is to help staff to feel motivated and incentivised in a downturn – without forfeiting precious financial resources.

Endorsing this theory is onHand, the on-demand volunteering and climate action platform. Last month, it announced it had raised $4m in pre-series A funding, after experiencing 300% year-on-year growth in 2022.

We caught up with onHand CEO and Startups 100 Exceptional Founder winner, Sanjay Lobo MBE, to learn about the benefits of CSR, and how to apply it for a positive company culture when morale is low.

What is onHand?

onHand, like many of the top startups for 2023, was a lockdown baby. Lobo was living in London during COVID-19 and struggling to assist his father, who lived in Brighton, with basic chores like food shopping. Professional carers were an option, but an expensive one.

Grappling with this challenge, he spotted a LinkedIn post from Good Innovation, a social impact business consultancy firm. Several major UK charities including the Red Cross, were asking for help to update their volunteering process. Instantly, Lobos’ interest was piqued.

“The impact and purpose part of it just got me thinking about it seven days a week,” says Lobo. Having worked for various high-growth startups in the past including Lastminute.com, he knew the idea had legs.

In its first year, onHand was mainly a B2C venture. But as the UK began to open up again, Lobo spotted that social impact (a measurement of how much a company is giving back to its community) was gaining traction amongst firms.

The return to the office had arrived, and companies were confounded by how to get office attendance levels back to normal. Staff wellbeing had also noticeably dropped.

“When we started, I’m not sure the trend was really there,” recalls Lobo. “Then we started having lots of businesses asking, ‘how can you help us engage our employees?’ ‘How can you help us give back to the community?’”

Why is CSR important for employee engagement?

Caring for thy neighbour is not a new idea. CSR as a business concept has been around since the 80s, with a common employee perk being ‘Charity Days’, or paid volunteering time. Historically, though, engagement has hovered under the 10% mark.

According to Lobo, this is not because employees are unwilling to participate, but because the opportunities are too difficult to find. onHand makes locating a volunteering opportunity more convenient, by matching users to local requests they can fulfil in shorter time blocks.

“That means the engagement rate just shoots up,” he explains. “About 50% of the company actually get involved, versus less than 10%.”

Employees want to feel proud of their workplace, which is why CSR initiatives have such a positive impact on employee wellbeing and loyalty. In a 2020 survey, nearly 70% of employees said they would not work for a company without a strong purpose.

“The stats are just increasingly piling on,” says Lobo. “It’s a huge trend and it’s moving so fast, which is wonderful.”

There are still some yet to catch up, however. In 2022, Tyl surveyed UK business owners to find out what CSR means to them. Despite 52% of business leaders saying CSR adds value to their business, Tyl found that more than half do not have a clear strategy.

Investing in employee engagement will be pivotal if businesses are to survive the next tumultuous 12 months, to keep workers enthusiastic about their roles and contributing wholeheartedly to company growth.

Lobo says he has already seen an uptick in the number of firms exploring CSR as a result of today’s business challenges. “There’s many world trends going on, there’s disastrous financial scenarios, homelessness, youth mentoring issues and of course, the elderly care crisis, which is where we started,” he recounts.

“At the same time, you’ve got this real change within businesses and how they need to be perceived by consumers and employees. Those issues are not going away.”

How can you use CSR for employee engagement?

onHand counts some big names in its client list including Trainline and Cazoo. Still, whilst he has borne witness to a lot of CSR success stories, Lobo cautions there are those who have got CSR wrong.

Mostly, he explains, this occurs when a brand isn’t fully behind its own cause. “If you can get backing from the company, you’ll get a great take-up,” he reveals. “If a company is just trying to tick the box, that’s where you get the biggest disconnect.”

Instead, Lobo suggests starting a CSR journey by speaking to employees to uncover exactly what opportunities they want from the volunteer app.

“Find whatever topics are most engaging for them,” he advises. “We offer such a variety of causes and that gives power to the employees.”

Of course, it’s key to recognise that today’s employees are also battling increased workplace stress as a result of the cost of living crisis. Convenient volunteering options that fit within the workday will be more effective in helping them to feel inspired, instead of overworked.

Lobo refers to its first-ever corporate client Newcastle Building Society, as a case study. The company transformed its call centre resource to place a huge volume of calls to isolated folks.

“Their staff might be doing tough calls with customers all day,” Lobo narrates, his enthusiasm obvious. “They take a 15 minute break to do a call with an elderly isolated person, and their employees can come out of that feeling they’ve helped the world in a slight way.”

Such an approach also lends itself well to localised, targeted charity work. Typically, charities like the Red Cross have operated on a national scale, which makes it more difficult for volunteers to find relevant opportunities.

onHand’s advanced search options make it easier to find ultra-local opportunities – even outside of the bigger UK cities. “It’s a lot more effective for engagement if you can see the direct input you’re having on your local area,” explains Lobo.

How can you use CSR for recruitment?

Studies have shown that Gen Z are the first age group to put purpose over profit when deciding where to work.

Coming from the emerging workforce, this has huge implications for how companies should attract job seekers – particularly given the ongoing hiring crisis. It seems as well as funding the existing workforce, CSR initiatives are an excellent way to invest in your future employees.

“I think CSR will be huge for how businesses recruit and retain the future workforce,” Lobo nods. He cites YuLife, another onHand client, as a startup that’s begun using onHand’s CSR materials to colour its job descriptions.

This, he says, will attract not necessarily a larger talent pool, but the best candidates for the job.

“We’ve always had a hunch that the most productive people are probably also the folks who are doing the most on volunteering and environmental action”, Lobo states. “Because they’re the people who are engaging more.”

How to measure positive change

CSR progress has a direct influence on environmental social governance (ESG) reporting. Essentially, this is a form of social impact evaluation that’s used to inform staff, customers, and stakeholders of a firm’s CSR activity and outcome.

Providing clear, numerical targets for employees provides an excellent stimulus to grow engagement. It’s also a good way for business owners to reinforce company values, a set of commandments which employees should strive to embody.

For example, if being community-focused is heralded as an organisational value, a firm could give staff a monthly goal relating to volunteering hours at a local food bank.

Alongside internal considerations, however, firms are increasingly under external pressures from stakeholders to deliver on ESG – particularly larger organisations.

“Managers have now got ESG targets, as have their boards,” Lobo determines. “I think that is going to filter down from those larger companies and become the norm.”

While these obligations are limited to sustainability at present, Lobo envisions that statistics on volunteering or donations will soon become part of annual reporting requirements.

To help its users react to the shift, onHand automatically pulls through figures on everything from employee engagement to CO₂ reductions, to give business owners access to ready-made data which they can then use to inform a clear and purposeful strategy.

“CSR has always been very ad hoc,” Lobo says. “People volunteer, but the results are not being captured. With onHand, companies can monitor employee engagement levels to track how many staff members have downloaded the app and how active they are.”

The data can also be used for marketing materials and to communicate a company’s purpose-led initiatives to customers. 67% of consumers under the age of 50 feel a brand’s social responsibility efforts are important to them.

The elephant in the room

The unavoidable topic when discussing ESG reporting is greenwashing. This is a term used when a company misreports its sustainability credentials – unintentionally or otherwise.

Trust in many climate action platforms has languished after a string of controversies. Last month, over 90% of carbon offsets from one market leader were found to be worthless.

Being accused of greenwashing risks serious harm to a brand’s reputation – not to mention, worker outrage. IBM’s 2021 Institute for Business Value study found that around one in three employees accepted a lower salary to work for a sustainable organisation.

How does onHand promise employers it can be trusted to provide valid environmental credentials?

“We investigated offering carbon credits and offsetting a couple of years ago and ultimately decided it wasn’t the right thing for us to offer,” Lobo discloses. “We just couldn’t get to the right confidence level. You could foresee that at some point it was going to go wrong.”

onHand’s climate action service validates only what Lobo describes as ‘real actions with real reductions’. For example, it applies external information around the CO₂ emissions produced from eating meat, to encourage a switch to a plant-based alternative.

Lobo does not think previous greenwashing scandals should hamper CSR progress. “If the world realises offsets aren’t the way forward,” he posits, “donate more into social value, or something else on climate change. Use the money for good in a different way.”

You’ve got to hand it to them..

onHand’s promise of convenient, data-led CSR puts it in great stead for growth this year – particularly as funding for purpose-led initiatives becomes common practice for UK businesses.

As Lobo states, “companies increasingly feel that CSR needs to be part of their mission, to add purpose and impact in the world.”

It can feel counterintuitive, or even wasteful, in a downturn. But with the right strategy, one that complements your existing business model, CSR initiatives like volunteering are a low-cost, low-effort way to boost morale

And if you still view CSR as a burden, not an investment, have a rethink. In the current poor economy, any business spend that can satisfy both staff and stakeholders will also have a positive effect on your bottom lines.