The Competitive Advantage of Being Socially Responsible

The reputation of a law firm is one of its most important assets. The combination of high client expectations, the highly competitive environment of the legal industry, and the readily available information on business practices has made corporate reputation more important than ever. While best-in-class legal skills and superior client service are givens for the success of any law firm, corporate social responsibility (CSR) is one way that your firm can enhance its reputation and stand out from competitors in the eyes of current and potential clients. A diverse and strategic CSR program is one more way you can market your firm this year.

CSR is “a commitment to improve [societal] well-being through discretionary business practices and contributions of corporate resources[1]” and includes a wide range of activities. There are three categories of CSR initiatives:

  • Economic CSR includes initiatives such as transparent accounting and employment practices such as diversity hiring;
  • Environmental CSR includes waste reduction and sustainable business practices; and
  • Social CSR initiatives include community relations programs such as company volunteering plans, donations to causes and organizations, and of course, pro bono work[2].

Tried-and-true pro bono work is certainly beneficial, but a diversified CSR portfolio will reap benefits for your firm and your community. When diversifying your pro bono initiatives, establish a dominant CSR category to support firm branding efforts[3]. Employee involvement is key in this effort. Knowing the issues your firm’s employees hold dear is crucial in accomplishing your CSR work. Simply put, if nobody cares about your firm’s CSR, no money will be raised and no time will be spent on the initiatives. While having a dominant category will support firm efforts to build a reputation for CSR, it is not meant to pigeon-hole CSR efforts. Just because your firm’s CSR is focused on education issues does not mean you cannot take on any green initiatives, support client CSR initiatives, or raise funds for breast cancer.

Another important aspect of having a CSR strategy is showcasing your firm’s CSR activities. The typical marketer’s toolkit (press releases, blogs, social media posts, events) is well suited to this, but there is a fine line between celebrating good work and bragging. In fact, communications by businesses about their CSR activities often raise suspicions of external or selfish CSR motivations[4]. Annual CSR reports have emerged as one way to combat such suspicions while still disclosing activities. Such reports are increasing in popularity in the business world, with 72% of S&P Index organizations issuing corporate sustainability reports in 2013[5]. Self-issued CSR reports have also been linked to financial returns and improved third-party evaluations of the issuing organization[6]. By taking the time and resources to produce a report, the firm demonstrates its commitment to CSR.

When it comes down to presenting the business case for CSR, there are many benefits, from financial to social, to support your argument. They include[7][8]:

  • Increased feelings for job satisfaction and employee engagement
  • Brand differentiation and competitive advantage
  • Improved customer/client engagement
  • Improved employee attitudes toward the firm
  • CSR expenditures correlate to better evaluations about an organization’s financial status

CSR involvement can also provide opportunities to relate to clients though a non-business avenue and expand attorney networks.

Socially responsible business practices are no longer an added bonus; they are expected and demanded across industries. While the legal industry is often slower to adopt business practices than other industries, the time to sit on the sidelines is over. By diversifying your firm’s CSR initiatives and developing a CSR promotion strategy, you can establish your firm as an industry leader for employees, community members, and clients alike.

 



[1] Du, S., Bhattacharya, C.B., & Sen, S. (2010). Maximizing business returns to corporate social responsibility (CSR): The role of CSR communication. International Journal of Management Reviews, 8-19.

[2] O’Riordan & Fairbrass, 2008

[3] http://blogs.law.harvard.edu/corpgov/2011/02/28/investing-in-corporate-social-responsibility-to-enhance-customer-value/

[4] Wang, A., & Anderson, R.B. (2008). Corporate social responsibility priming and valence of CSR framing on CSR judgments. Public Relations Journal, 2(1), 1-19.

[5] http://www.ga-institute.com/nc/issue-master-system/news-details/article/seventy-two-percent-72-of-the-sp-index-published-corporate-sustainability-reports-in-2013-dram.html?tx_ttnews%5BbackPid%5D=224&cHash=e1111fb1a531c637a544c83a97a760bd

[6] Dhaliwal, D.S., Li, O.Z., Tsang, A., & Yang, Y.G. (2011). Voluntary nonfinancial disclosure and the cost of equity capital: The initiation of corporate social responsibility reporting. The Accounting Review, 86(1), 59-100.

[7] http://www.forbes.com/sites/csr/2012/02/21/six-reasons-companies-should-embrace-csr/

[8] http://insight.kellogg.northwestern.edu/article/pinpointing_the_value_in_csr/

By Ashley Stockwell, Communications Coordinator at BuckleySandler LLP, for the January/February issue of the Capital Ideas newsletter. 

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