Issue Specific Report

Internal CSR communication and employee engagement

September 2010

www.csreurope.org

Contents table

1.

Introduction .....................................................................................................................................3

2.

Definition and development of Internal Communications........................................................5

2.1 Internal CSR communication ............................................................................................................ 5 2.2 Definition and development of Employee Engagement............................................................ 7 2.2.1 Ensuring employee’s engagement and alignment with the company’s CSR strategy ..... 8 2.2.2 Human Performance Technology ................................................................................................. 8 2.2.3 Optimal Process of Communication (OPC) ................................................................................ 9 2.3 The business case ................................................................................................................................ 9 2.4 Best practice collection and benchmarking............................................................................... 13 3.

Overview on internal CSR communications and employee engagement ..........................19

4.

Conslusion .....................................................................................................................................25

5.

Links and Further documents ......................................................................................................22

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1. Introduction Internal CSR communication and employee engagement are widely considered to impact on all layers of a company’s structure and are implemented continuously via top-down and bottom-up communication. From informing employees about their organization’s CSR strategy and activities, to enabling two way communication for consultation and cooperation and ultimately engaging and training employees on CSR related issues, companies apply various tools and mechanisms to implement internal CSR communication and employee engagement. The strategic alignment of internal CSR communication and employee engagement with overall business performance/company targets must be considered to be at the core of successful CSR strategies. In many cases, regional CSR coordinators are put in place to manage local specifities and implement individual CSR policies. While CSR strategies are mostly conceptualized by senior management, the actual implementation requires regular dialogue with all business units and employees. Consequently, employee engagement is carried out via multiple and diverse programmes, taking into account the different levels of CSR awareness and requirements for effective implementation of CSR strategies. Being at the core of corporate CSR strategy, internal communication and employee engagement may play a vital role in ensuring a successful implementation of CSR commitements via engaging employees to become active CSR practitioners, feed into the CSR strategy, increase loyalty and ultimately transform them into company ambassadors. This research aims to map out how internal CSR communication and employee engagement are implemented into corporate systems. In order to provide a insight into some leading companies in the field, interviews with selected CSR Europe member companies were conducted to get a better insight into the specific process leading to internal CSR communication and employee engagement: •

Intel

•

Coca Cola Hellenic

•

Bottling

•

BT

•

KPMG

As such, this report will first be highlighting the conceptual background and the business case for internal CSR communication and employee engagement along the lines of the most prominent and commonly used research studies as well as the responses given by the interviewed companies. 3

Secondly, a benchmark of some CSR Europe companies, including their best practices or preferred solutions to integrate internal CSR communication and employee engagement, will be presented. Fianlly, a compilation of best practices will be provided, before presenting alternative sources for further research on the topic.

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2. Definition and development of Internal Communications

2.1 Internal CSR communication Internal communication can be defined as ‘the planned use of the communication actions to systematically influence the knowledge, attitudes and behaviors of current employees' 1. In other words; it can be simply referred to as ‘an organisation’s managed communication system where employees are regarded as a public or stakeholder group’ 2. To provide a better understanding of what internal communication is about, short descriptions of different internal communication tools (channels), approaches and main challenges that businesses have to face in this area are provided. Indeed, there are a number of different approaches on how the internal communication can be used.: •

Informal and formal communication: Formal communication is closely associated with a formal organisational structure and usually flows through officially recognized positions along the line in the company. Through the informal communication, messages are conveyed based on the informal relations. Although formal communications are prevalent in most of the companies some aspects of informal communication can be integrated as well (e.g. social media).

•

One-way and two-way communication: One way communication is always transferred in only one preassigned direction (including advertisements, newsletters, magazines etc.) while two way communication encourages input and feedback from all communicating sides (forums, discussions etc.).

•

Downward and upward (or top-down and bottom-up) communication: Downward (top-down) communication comes from higher levels and information is transmitted to employees, while upward (bottom- up) communication, in reverse, comes from employees and information is transmitted to the higher levels (it is usually implemented by collecting data from employees through surveys or by encouraging a direct feedback through discussions, focus groups etc.).

1 2

Stauss and Hoffmann (2000) quoted in ‘Exploring Public Relations’, Tench R., Yeomans L. Tench and Yeomans (2006) ‘Exploring Public Relations’

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Communication tools There are a number of internal communication tools. Most companies combine different channels or use several of them at the same time. A variety of such tools allows company to reach a higher number of their employees and address their needs for communication issues better. There are four main categories that internal communication channels fall into: •

Electronic: This is a type of communications that are delivered and/or accessed electronically, either by computer, telephone, television or other devices. Examples include email, intranet, video and webcasts, electronic newsletters, podcasts, blogs, voicemail, conference calls, SMS text messaging, screensaver messaging, desktop alert messages, desktop news feeds and internal social media tools.

•

Print: These are paper-based communications, for example magazines, newsletters, brochures, postcards, posters, memos etc.

•

Face-to-face: This type of channel includes one-to-one and one-to-many forums where people are physically present. For instance, team meetings or briefings, conferences, site visits, consultation forums, round-table discussions, etc.

•

Workspace: These are communication tools that are physically present at the working environment. Examples include notice boards, plasma and LCD screens, accessories (e.g.: mousemats), window decals, etc.

Challenges •

Cultural diversity: For companies that are operating at a global level, cultural diversity is the factor which has to be taken into consideration to. As communication varies a lot across different cultures and countries, it is very important to identify specific needs and attitudes of employees working in different cultural environments and then to adjust internal communication strategy accordingly.

•

Costs: Budget capabilities play a very important role in communication strategy planning process so it is always important to find an optimal solution. What has to be taken into account is that the most expensive communication tools are not necessarily the best ones therefore each company has to discover the way of how to implement internal communication most effectively.

•

Departmental & Operational Differences: Adapting internal CSR communication to the specific departmental and operational specifities in corporate structures can be seen as one of the most important challenges a company has to face. Hence, internal CSR communication can only be succesful if it takes into account the different realities of diverse business units and employees.

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2.2 Definition and development of Employee Engagement William Kahn (a researcher and professor at the Boston University School of Management) in 1990 defined work engagement as “the harnessing of organizational members’ selves to their work roles”. The concept was later expanded to describe when employees feel positive emotions toward their work, find their work to be personally meaningful, consider their workload to be manageable, and have hope about the future of their work. 3 Recent research show that a company’s reputation as a responsible corporate citizen and its involvement in CSR activities is one of the main factors that stimulates employee engagement, therefore more and more businesses are looking for ways of how to engage their people in order to make them a part of their CSR strategy. There are a number of general practices that companies use for employee engagement in their CSR strategy: •

Employee volunteering: As many companies are involved in local community programmes, employees are very often encouraged to take an active participation in them and spend some of their time helping those communities.

•

Individual employee programmes on CSR: Many responsible businesses have CSR programmes for their employees, most of which are related to environmental protection and sustainability. This can include various clubs or informal groups, where employees share their ideas on how to reduce their own environmental footprint.

•

Education on CSR: In order to engage employees in company’s CSR activities, first of all it is necessary to ensure their understanding of CSR concept as well as company’s CSR strategy as a whole. In order to do so, many businesses organize CSR related trainings, seminars and workshops. It can be also implemented by using conventional internal communication tools such as websites, e-mails, handbooks etc.

•

Use of employee feedback to shape CSR strategy: Encouraging employees to share their ideas on how to improve company’s CSR strategy (through surveys, discussions, focus groups etc.) can have a positive effect both to the management team (who might discover new ways to shape or modify CSR strategy) and to the employees (as they are provided with an opportunity to have a say and feel more valued by their employer).

There are numerous ways of how to use internal communication and engage employees in businesse’s CSR activities, however in order to create a successful strategy on that, each company has to find its own best way of how to do that. Although it is not an easy job to do, it has been proved that properly implemented strategy can bring a high number of benefits, description of which is provided in the next section below. 3

Attridge M. (2009), ‘Employee Work Engagement: Best Practices for Employers’, ‘Research Works’ Vol 1, Issue 2

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2.2.1

Ensuring employee’s engagement and alignment with the company’s CSR strategy

Employees are among the key stakeholders for the development of any CSR strategy or program. A critical first step in mission, vision, values and strategy development is to understand the key concerns, priorities and perspectives of all key stakeholders, particularly employees. Research by Towers Perrin in 2007 revealed that an organization’s reputation for social responsibility was one of the top 10 engagement drivers, along with senior management’s interest in employee wellbeing, opportunities to improve skills and capabilities and input into decision-making. The study 4 “Engaging employees in Corporate Social Responsibility” highlights the spectrum of employee’s engagement in CSR from “I’m aware of the message”, in which employees are familiar with the CSR strategy and how it helps the company meet its objectives; to “I understand the message” wherein employees learn the reasons behind the company’s CSR objectives and begin to understand their role in making the company successful. The next stage is “I believe”, where employees feel conviction towards the company’s CSR values and objectives, and finally, “I am committed to act”, the highest level of commitment. Those employees who are and feel their basic job needs are being met and who achieve this level, will be inspired to act in ways that help the company reach its goals. Cascading a strategy means to translate the corporate-wide sustainability strategy down to first business units, support units or departments and then teams or individuals. The organization alignment should be clearly visible through strategy, using the strategy map, performance measures and targets, and initiatives. Scorecards are used to improve accountability through objective and performance measure ownership, and employee’s behaviors are incentivized with recognition and rewards. The integration of sustainability KPIs in the performance assessment of employees aims to harmonize and align the company’s values with the employees’ values. Therefore, if CSR becomes a core component of employee engagement and therefore a key driver of business value, CSR alignment will become a more critical tool for fostering corporate success over time.

2.2.2

Human Performance Technology

Human Performance Technology (HPT) uses instructional technologies to improve the performance of individuals, especially regarding organizational performance (effective and efficient achievement of organizational goals). Therefore, Human Performance Technology can be viewed as a field of endeavor 4

Melcrum (2006) Engaging employees in Corporate Responsibility accessed on http://www.melcrum.com/store/products/product.shtml?id=3125

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that serves to bring about changes to a system, in such a way that the system is improved in terms of achieving its values. The field of HPT comprises various definitions and approaches. A useful overview on the various models and fields of application can be found at: http://www.humanperformancetechnology.org/hptmodels.html

2.2.3

Optimal Process of Communication (OPC)

OPC International Group ("OPC") was established by the Swedish consultants Bengt-Arne Svennberg and Kent Fälth The OPC Process® works because it is a democratic internal communication methodology; a genuine attempt to connect with each individual in your organisation that demonstrates respect for what the listener thinks and what he or she has to say. As management, you want your new policy, vision, or new approach to be accepted and established within your organisation. You want everyone to share your ambitions. You have something strategically important to say and you want your message to be understood and accepted by every individual. For further information, please visit: http://www.opcuk.com/about/about.html

2.3 The business case Effective Corporate Social Responsibility policies are a requirement for today's companies. But policies have not only to be formulated; they also have to be delivered by corporate employee. Even the best initiatives can be useless without the buy-in from the employees who will be carrying them out. When looking at the reasoning that drives a company to implement internal CSR communication and employee engagement programmes we find two main reasons: the successful implementation of the CSR strategy and the employee loyalty to the firm. Therefore, it is critical to recognize the employees as key –internal- stakeholders as a first step. Employees are businesses’ brand ambassadors; they are always talking about their companies whether or not their companies are talking to them. Hence, communication to internal stakeholders on CSR is crucial to their engagement and loyalty, but also to the success of the whole strategy. 9

However, employee loyalty is not a benefit itself; interesting is what it carries within it. Loyal employees feel better in the firm and are more committed, motivated and efficient at work. On the other hand, they better communicate externally about the company and its CSR strategy. A study conducted by Hewitt and Canadian Business for Social Responsibility 5 (CBSR), showed that there is a strong correlation between employee engagement and how they view their employer’s record on social and environmental responsibility. Hewitt and CBSR analyzed the rankings of the Best Employers in Canada study and a companion study to gather the opinions of more than 100,000 employees and 2,000 leaders in over 230 companies. Based on the findings, companies with high employee engagement are more inclined to focus on corporate social responsibility (CSR) as a strategy to improve overall organizational performance and better meet the needs of employees and external stakeholders. For their part, 86% of employees at organizations with high engagement agreed that they worked for an employer that was socially and environmentally responsible. This figure fell to 71% at employers with moderate engagement and was only 60% at those with low engagement. For the study’s authors, the findings also show that declining employee perceptions of CSR within an organization can be a significant threat to engagement for over a third of organizations. They recommend combined initiatives to sustain both employee engagement and CSR in order to increase the probability of a better return on investment than non-coordinated efforts. This idea was also reflected in the interview to Janet Blake, Head of Corporate Responsibility Engagement at BT: “We know, because we have the evidence, that employees who are proud of the CSR achievements [of BT] and feel involved in those CSR achievements and see that it mirrors their own personal responsibility are more motivated, more effective and they’re more feeling like driving the business further, more productive and motivated as a workforce. I think secondarily, employees take a very important message out to our customers, because if they are motivated and understand what a good responsible business looks like, they will embed it into how they do their job, and that means that they will be seeking about CSR as they make decisions about customers and that in turn brings a better benefit to our customers.”

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Strong link between corporate social responsibility and employee engagement http://www.humanresourcesjobs.ca/newsletter/strong-linkbetween-corporate-social-responsibility-employee-engagement-l-en-i-868.html

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Highly engaged employees will consistently deliver beyond expectations and will have a sense of belonging or a strong bond with the company and its brand. This creates a ripple effect that results in a positively charged atmosphere in the organisation. So, it can be stated that employee engagement and internal communication are a win-win strategy. According to a research by Gallup, 6 engaged employees are more productive. They are more profitable, more customer-focused, safer, and more likely to withstand temptations to leave. The best-performing companies know that an employee engagement improvement strategy linked to the achievement of corporate goals will help them win in the marketplace. This research also reflects that actively disengaged employees erode an organization's bottom line while breaking the spirits of colleagues in the process. This can also be seen in figures: within the U.S. workforce, this is estimated to cost more than $300 billion in lost productivity alone. To avoid these unwanted results, the CSR strategy has to be cascaded down. This means communicating from the top levels to the employees through business units, support units or departments and then teams. Also, the opinion on implementation of the employees has to be heard, and taken into account, through surveys or other, more direct mechanisms. It is important that both top-down and bottom-up directions are properly covered. The organization alignment should be clearly visible through strategy, using the strategy map, performance measures and targets, and initiatives. Scorecards are used to improve accountability through objective and performance measure ownership, and employee’s behaviours are incentivized with recognition and rewards. The integration of sustainability KPIs in the performance assessment of employees aims to harmonize and align the company’s values with the employees’ values. Communication to internal stakeholders has to be engaging in order to create employee empowerment and ownership of CSR issues. From the employee’s perspective, even if there are many determining factors that take part into their engagement, such as career advancement opportunities or work-life balance, the reputation of the organization for social responsibility is a key one. The next chart 7 shows the top global drivers of employee attraction, retention and, what interests us the most, employee engagement.

6

Employee Engagement Overview Brochure, Gallup: http://www.gallup.com/consulting/121535/Employee-Engagement-OverviewBrochure.aspx 7 The Journal of the EDS Agility Alliance www.eds.com/synnovation

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From the companies’ perspective, there are other critical factors as well, apart employee engagement in the CSR strategy, such as, talent retention and employee professional development. The commitment to employee engagement and internal CSR communication has to be a sincere commitment. If this engagement is properly pursued, it can be a win-win strategy, while if it is carried out without taking into account the employees or the content of the engagement it can reverse the positive effects into dilemmas such as green-washing. From the following information it is important to practically implement the learnings to enable organisations to customise it and fit into their business strategies for employee engagement a form of to be effective communication. CSR Europe have collated and identified key examples through its research to create a list of key best practices for employee engagement.

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2.4 Best practice collection and benchmarking In order to support the information from the previous chapter, a compilation of best practices within the telecommunications, financial Services, beverages, chemicals and energy sectors will be provided in this chapter, highlighting key employee initiatives and how it is communicated across the organisation internally.

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14

15

16

17

18

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3. Overview on internal CSR communications and employee engagement To compliment the best practice focus, CSR Europe conducted interviews with four of its members across sectors focusing on the approach, tools of communication, mechanisms implemented and the method of data collection used internally to engage employees. Intel • Three pronged approach

approaches of internal communication and employee engagement

• Both bottom-up and top-

BT • Global communication

Coca Cola Hellenic • CSR strategy is

used: internal

down communication

strategy combined with

communicated at a global

communication and

approaches used.

divisional communication

level and then at local level

strategies.

(e.g. different countries

employee engagement is

1. General

KPMG

• Communication is

driven through employee

transferred level by level:

education, participation

from the board to ‘European

in CSR programmes and

practice’; some countries

channels applied to

have ‘CSR Leadership Team’

different levels of

made up of partners, that

management.

by making them advocates.

have their own magazines • Different communication

• Communication matrix

published in local language). • Both bottom-up and topdown communication

• Both bottom-up and top-

are responsible for different

down communication

CSR areas; local offices have

combined of different

approaches used.

CSR Forums which are a

channels and different CSR

development- as an

group of people responsible

topics (network of

integral part of day-to-day

strategies are mostly

for CSR at the particular

ambassadors responsible

business

generic across the

local office and a

for different CSR topics).

business; different tools

‘connection point’ between

and approaches are used

• Employee engagement

approaches used. • Employee learning and

• Each level of management

• Both bottom-up and top-

(top management team,

employees working there

down communication

regional managers etc.)

for some

and higher management

approaches used.

has their own roles in CSR

divisions/branches with

levels.

particular specialties (e.g. for people in

• Although there is a generic

strategy development and implementation.

CSR strategy for the whole 19

manufacturing that are

company, each office has its

working shifts)

own objectives and tools to

• Corporate messaging

implement it.

combined with communication at local level. • Open door policy (employees are encouraged to give feedback to their managers at any time). 2. Scope

Addressed to all employees • Screens with CSR related

Addressed to all employees • Reports:

3. Tools (channels) used

• Annual CSR report;

internal online newspaper

• Sessions

• Community investment

and magazines, e-mails,

• Videos

posters.

• Notice boards

reporting on KPMG’s

• Internet platform for

environmental impact.

ITube (video site), online

communicate

sessions (web jams);

CSR internally

• Announcements made at • Executive briefing

Intel’s articles on CSR;

to

• Intranet • Leaflets

• E-mails;

• Social media: blogs, Intel

• Conventional

Addressed to all employees

communication channels:

info in bathrooms and canteens;

Addressed to all employees

• Website for employees.

statements.

staff celebrations and events • Employee magazine (quarterly

• Newsletter;

• Website

• Online communication

• CSR report

tool (‘Ask’ employee

• Code of Business Conduct

services); • Monthly update 20

meetings; • Awareness week (face to face sessions). • CSR related programs for

• Volunteering programs for

employees (e.g. ‘The

employees (e.g.

Wild Section’).

volunteering programme for mentoring refugees).

• Employee participation in

4. Employee engagement

• Involvement (at local level)

Intel’s CSR programmes

in Carbon Footprint

(in three areas:

programmes.

• CSR award programme for employees.

• Volunteering programs • Employee engagement in CSR programmes (Eco

• Employees involvement in BT CSR programmes (e.g. Carbon clubs). • Employees’ involvement

driving, energy use and community programmes) • Making employees aware of KPIs by including them

citizenship, education

into CSR strategic decisions

as a part of business

and environment).

(e.g. focus groups).

targets to be achieved

• Employee volunteering.

• Health and Wellbeing

mechanisms

initiatives were rolled out in business units during which involved active participation of employees. These included sports events, medical checks, nutrition advice and active lifestyle programmes. • Trainings for employees are provided, however, their

5. Trainings

Not specified

• Training tool on sustainability matters.

provision depends on individual case. E.g. trainings might be provided before

• Short employee trainings on CSR via the intranet (elearning programme)

• Bespoke training to account and sales (B2B)

• Trainings on eco-driving • Trainings for senior 21

starting implementing one

teams in particular.

managers on sustainability issues.

CSR programme but not included in the implementation process of another one. 6. Data collection methods (to measure engagement, to receive

• Surveys: • Quarterly employee communication survey; • Annual organisational

• ‘The people survey’

• Online surveys to measure

• Internal surveys twice a

(conducted once in two

employee engagement

year to get feedback on

years on company’s CSR and

(once per quarter).

company’s CSR

employee engagement in CSR activities).

health survey.

programmes. • Focus groups (e.g. held to

• Annual stakeholder panel

support in selecting a new charity partner).

feedback) • Development of social media site. • Finding persons in the 7. Present and

organisation to educate

future

other employees.

• To communicate CSR to employees succinctly. • To manage the complexity

• Improve the ways that social media is used for

group who would be able

internal communication.

to develop CSR strategy efficiently.

of data that is required. • Making transition from non-

• Creating a cross- functional

• To reach a target of 90%

challenges to

skill based employee

employees being proud of

be faced in

engagement activities to the

working for BT.

terms of

ones where employees

internal

would be able to use their

employees understand

communication

skills.

why BT is making decisions

• Striving to make

and employee

related headcount

engagement

reduction and what company is doing in CSR in general in order to improve employee 22

engagement.

‘Having actively engaged in a ‘It’s observed in the results of the ‘BT measured that ‘employees, ‘On

average,

employees

CSR strategy for the last 20 surveys that if there is high CSR who are proud of BT’s CSR received 20 hours of formal years has helped us to build a engagement there is also high achievements, feel involved in training, up from 16 in 2008. strong reputation and local employee engagement. So they’re those CSR achievements and see CSR training courses in the partnership and we work as a quite strictly linked.’

that

valued good neighbor in the

personal responsibility are more eco-driving and others totalled

community

motivated, more effective and over 25,300 participants, out of

generate

8. The results

and

employees

positively

Intel’s

it

mirrors

their

own topics of environment, safety,

they feeling more like driving almost

65,800

training

reputation externally.’ About

the business further’. 60- 65% of participants. In addition to

30%

employees claim that they are our

of

employees

are

engaged in CSR programmes

proud of working at BT

major

programme

in

Hungary, Health and Wellbeing initiatives were rolled out in 14 other business units during 2009 which

involved

active

par-

ticipation by more than 20% of employees. Most of our community general

programmes

they

are

in

involving

employees to participate in voluntary programmes as the International Commission for 23

the Danube river, or other programmes Ukraine,

in

Belarus,

Russia,

Romania,

Croatia, Poland etc. That has a significant

benefit

and

overall community support.’

24

the

4. Conslusion The research revealed a common understanding of the business case and necessity of internal CSR communication and employee engagement to effectively implement CSR strategies across all layers of a company. At the same time, a variety of processes and management systems were identified. Hence, one-way and two-way as well as bottom-up and top-down communication is applied across companies, depending on the aim, scope and hierarchical structure within a given company. Therefore, it seems that no single mainstreamed approach can be identified for internal CSR communication. However, some of the most popular tools for internal CSR communication are the use of intranet, leaflets, videos, announcements at celebrations and events, employee magazines, websites, social media, CSR reports and dedicated awareness weeks. A major challenge faced by companies, however, is how to adapt internal CSR communication to local, departmental and operational specificities whilst ensuring global CSR policies and strategic alignment. In terms of employee engagement, companies seem to apply various tools to ensure a sustainable commitment of employees towards CSR strategies and targets. Thus, tailored training sessions, workshops, employee volunteering programmes as well as a regular stimulus for providing feedback into CSR policies are among the most prominent mechanisms to enable employees to actively participate and implement CSR across the company. Here again, a major challenge can be found in the sound translation of global strategies into local, departmental and operational specifities. A significant trend seems to be the importance of regular bottom-up communication mechanisms in order to increase awareness, create ownership of CSR commitments, retain and attract talents and ultimately turn employees into active practitioners and company ambassadors towards external stakeholders.

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5. Links and Further documents

OPC International Communicating CSR

http://www.opcuk.com/faq/faq.htm http://globalcompactasiapacific.org/regional/plugins/tiny_mce/plugins/imagem anager/files/Resources/Tools/communicatingcr.pdf

Ethical Corporation:

http://www.ethicalcorp.com/content.asp?ContentID=7114&utm_source=http%

Employee

3a%2f%2fcommunicator.firstconf.com%2flz%2f&utm_medium=email&utm_cam

Engagement

paign=EC+News+06+10+10+2&utm_term=Ryanair+thriving+on+bad+publicity%2

Briefing

c+single-minded+reporting++Ethical+Corp+weekly+eBrief&utm_content=354027

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