Corporate communication is one of the key factors that determine whether companies thrive or fail. It impacts employee productivity, innovation, brand awareness, and more.
Environmental, social, and governance (ESG) elements are becoming more significant for businesses and investors since they indicate an organisation’s impact and performance on multiple areas of sustainability.
Corporate communication help bolster a company’s reputation and connections and plays a significant role in assisting with ESG reporting and disclosure such as:
- Aligning ESG strategy with corporate vision and values
- Monitoring and measuring ESG impact and reputation
- Building ESG partnerships and collaborations
- Fostering ESG culture and leadership
Companies can not only generate favourable stakeholder attitudes and better support behaviours (such as purchase, seeking employment, investing in the company) by engaging in corporate social responsibility (CSR) activities, but also, in the long run, build corporate image, strengthen stakeholder-company relationships, and increase stakeholder advocacy behaviours. However, stakeholders’ lack of understanding of, and negative attitudes towards companies’ CSR operations continue to be significant hurdles to companies’ efforts to maximise commercial advantages from their CSR activities, underscoring the need for firms to explain CSR to stakeholders more effectively.
In light of these challenges, a conceptual framework of CSR communication is presented and its different aspects are analysed, from message content and communication channels to company and stakeholder-specific factors that influence the effectiveness of CSR communication.
Defined broadly as ‘a commitment to improve social well-being through discretionary business practices and contributions of corporate resources’ corporate social responsibility (CSR) occupies a prominent place on the global corporate agenda in today’s socially conscious market environment. More than ever, companies are devoting substantial resources to various social initiatives, ranging from community outreach and environmental protection, to socially responsible business practices.
These CSR efforts are driven by the multi-faceted business returns that corporations can potentially reap from their CSR endeavours. Indeed, findings from both market place polls and academic research suggest that key stakeholders such as consumers, employees and investors are increasingly preferring ‘good corporate citizens’
Corporate governance and reporting
CSR is a component of corporate governance that assists a corporation in being ethical and accountable to the government, shareholders, and all stakeholders. It assists businesses in developing strong customer connections. This contributes, when communicated internally and externally, to people’s faith in a company while also assisting in the growth of our country. It is a concerted effort to increase a company’s brand value and improve its brand image.
Section 135 of the Companies Act, enacted by the Government of India in 2013, was a bold attempt to enhance corporate governance and hold corporations accountable while also enhancing the business process in India. It specified that a CSR board committee must be formed by a corporation. If the company has a net value of INR 500 crore or more, a turnover of INR 1,000 crore or more, or a net profit of INR 5 crore or more, it must additionally spend 2% of its average net earnings for the prior three fiscal years on CSR initiatives. This part of the Companies Act, 2013, has a significant influence on enterprises and helped to transform the entrepreneurial environment in India.
The Securities and Exchange Board of India (SEBI) took a step further and introduced new requirements for sustainability reporting by listed entities. The new reporting called the Business Responsibility and Sustainability Report (BRSR), is applicable to the top 1,000 listed entities (by market capitalisation), for reporting on a mandatory basis from FY 2022 – 23.
The BRSR places a strong focus on the entity’s disclosures on climate and social (employees, consumers, and communities) concerns to ensure transparency.
Financial stability and corporate reporting
It’s like attempting to fly a plane with one wing gone if you do not have the ability to communicate effectively about financial stability policy. It needs more than just good policies. Communication is an important aspect of the work. Communications should not be an afterthought when building financial stability frameworks. It’s not all about data, analysis, and measures, but also about getting your messages across and gaining support from a broader audience.
This article is written by Shreya Sarkar, Editorial & Research, Kalolwala & Associates Pvt Ltd, and the views expressed in this article are her own
