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Why corporate citizenship matters to branding professionals

By Denis Riney

In the last half-decade or so, the phrase “corporate citizenship” has found its way into the management lexicon. Management theorists and brand pundits alike have embraced the notion that every corporation needs to define its societal purpose. Entire corporate citizenship departments are being formed, many charged with the responsibility of managing and reporting on the firm’s environmental, social and governance commitments.

Brandlogic wholeheartedly believes that every corporation needs to define its relationships with all stakeholders, not just investors. But what is the proper role of corporate citizenship as it relates to the positioning of the corporate brand? Does every brand positioning statement need to be based on the firm’s overarching societal purpose? And what is the best way to measure how important is it relative to other key brand attributes?

Of course, there are no pat answers to the above. To help guide our clients as they ponder these questions, we’ve assembled some hard facts about the role of corporate citizenship in the way various audiences make decisions.

In our Sustainability Leadership Report, an original research study by Brandlogic, we learned in 2011 and confirmed in 2012 that different stakeholders weight corporate citizenship quite differently in their decision-making processes. Our study found that among three key audiences - professional investors, supply chain executives and recent university graduates - 88% said that good corporate citizenship performance had a important influence on the decisions they make to invest in, partner with or work for a particular company.

Among customer audiences, there is a growing body of evidence to suggest that they do not make choices based on perceptions of good corporate citizenship. A rival study by Interbrand found that only a minuscule 2% of decisions by consumers are driven by how they perceive a company’s actions in this arena.

While these general findings may be helpful, we believe there is no substitute for doing the hard work if you are repositioning your brand. Do the research with the audiences that matter most to you. Determine (through research, not anecdotes) how your corporate citizenship profile influences purchase behavior (with customers) and influences perceptions (among other stakeholders). Then make an informed judgment about how best to balance and communicate the attributes that will help you drive your performance.

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