CSR is something that companies today are taking more and more seriously. It is no longer just a way to get better press from journalists, it is a fully fledged strategy to effectively run a company, creating a sustainable and pleasant environment for both employees and customers.
Traditionally we have seen that this has revolved around charity work, sustainable business practices, environmental efforts, and supply chain management. However, in recent years, it has become a question of transparency. Essentially, if we can't see what a company is doing, it cannot be trusted. Data has had a big impact on this, allowing people to see how a company is operating without bias.
However, it is not only in the use of data to show good CSR, but increasingly their use of data is part of good CSR.
Modern companies hold a huge amount of data on their customers, from their credit card numbers and email addresses through to some of their most intimate details and behavior patterns. A company holding this data is an indication of trust in them, a willingness from the customer to entrust important information because the company has shown themselves to be capable of protecting it and using it properly.
Companies like Experian, Target and Ashley Madison, have all damaged the trust given to them by their customers and this should serve as a warning to others around the world that data security is very much at the heart of modern corporate CSR. The breaches cost Target over a quarter of a billion dollars, Experian's stock plummeted after the news and the cost to Ashley Madison may be £1.2 billion in the UK alone. But it is more than initial monetary loss that the companies have incurred - the ongoing impact on their reputations will cause long-lasting damage to their businesses.
If a person was going to have an affair, they are now incredibly unlikely to use Ashley Madison. Likewise, given a choice, people are unlikely to entrust their data to Experian, and people will also think twice about using their cards at Target. It is the same situation as companies who felt the impact of more traditional CSR issues, like Nike’s slave labor issues, BP’s oil spills, and Lloyds’ PPI scandal.
However, the impact is not only the loss of revenue, but also in the fact that bad CSR is having a genuine impact on recruitment. A study from Cone Communications found that 53% of millennials sought employment that made a positive impact and 72% of college seniors agreed that it was important to their happiness. Nobody wants to work at that company who everyone hates, regardless of how much you get paid to do so.
In modern society this is about more than just giving to charity, paying taxes, and helping the environment. Data security is now one of the most important elements of any CSR exercise and should be seen as much. It is not just a case of leaving it to the IT guys, it needs to be a responsibility taken on by the entire company, and those who don't will risk more than monetary loss.