Environmental Leader

The economic recession has not put an end to corporate citizenship. Based on current economic conditions, 15 percent of companies are increasing their research and development for new sustainable products; 11 percent are increasing corporate citizenship marketing and communications; and 10 percent are increasing local and/or domestic sourcing or manufacturing, according to a new study from the Hitachi Foundation and the Boston College Center for Corporate Citizenship.

The study finds that about 54 percent of U.S. senior executives believe corporate citizenship is even more important in a recession with 54 percent now communicating with employees about it and 39 percent talking with stakeholders.

Another finding reveals a majority of U.S. companies are not making major changes in their corporate citizenship practices. Of those who made changes, 38 percent reduced philanthropy/giving, 27 percent increased layoffs, and 19 percent reduced R&D for sustainable products.

The study, Weathering the Storm: The State of Corporate Citizenship, also finds that large companies are responding to the recession much differently than small companies. For example, large companies significantly increased their investments and involvement in citizenship activities, but they were also more likely to lay people off. Small firms had minimal layoffs but they significantly decreased attention to other aspects of citizenship, such as volunteering or philanthropy.

The study also indicates that environmental sustainability efforts continue to grow during the recession. Twenty-nine percent of business leaders say their companies support environmental issues through their community investment strategy, which is a 10 percent increase since 2007.

Sustainability is now seen as a major business driver with 52 percent of companies (65 percent of large companies) designing and offering sustainable products or services, about 72 percent of American companies (85 percent of large) reducing costs through improved materials efficiency, and 58 percent (60 percent of large) manufacturing or sourcing domestically/locally.

In addition, 59 percent of large companies offer energy-efficient products and another 59 percent provide customers with more information about social and environmental impacts of their products and services.

Among large companies, 63 percent have goals and objectives around environmental responsibility, 58 percent measure the business impact of their environmental initiatives, and 47 percent report having environmental performance goals for individual managers.

This latest study supports the 2009 Greening of Corporate America Report, which found that twice as many companies see sustainability as centrally oriented to their business operations, including the sale of “green” products or services, as compared to 2006.