Importance Of Transparency
July 14, 2014 Bruce Burtch
The times, they seem to be a-changing for corporate social responsibility campaigns. According to the 2013 Cone Communications/Echo Global CSR Study, a whopping 87 percent of the more than 10,000 respondents said that they make purchases based on what they know about an organization’s social, environmental and cause-related engagement.
The remaining 13 were predominantly older than 55. The Old Guard is fading out, and the New Guard wants to know what your organization is doing. They’re even willing to say “it’s okay if a company is not perfect, as long as it is honest about its efforts.”
It’s interesting to see that most of these consumers don’t believe that they’re getting as much truth and transparency as they should be from corporations. In fact, Cone reports that 91 percent of Americans believe organizations should tell them how they are supporting causes, but many do not think they are getting sufficient information. Only 58 percent of Americans believe companies are providing enough details about their cause efforts.
Along with the rapid growth and success of cross-sector partnerships, there is an increasingly savvy and information-hungry public. It means that a mere lack of transparency can now cause suspicion or even damage to an organization’s image.
The public wants to engage in causes they care about. Companies do, too, albeit for slightly different reasons. Neither wants to be involved in a campaign that has something to hide. That’s why the transparency of your cross-sector partnership is crucial.
Transparency means trust
Transparency means telling the truth about your organization, your partnership, and your goals. It means disclosing who is benefitting from a campaign, how much they are receiving, and precisely how and when funds are being raised and disbursed.
No cross-sector partnership can truly get off the ground until each side has put all its cards on the table, stating clearly what it can provide to the campaign (staffing, financing, exposure, equipment, media contacts or other contributions) and specifically what it expects to gain from the campaign. When your potential for-profit partner sees clear, well-thought-out objectives that are beneficial to their efforts (see a full list of potential nonprofit and for-profit cross-partnership benefits at bruceburtch.com), they will work hard to meet your goals.
Transparency means trust by your public
Once the partnership develops an honest, solid plan, that transparency must be extended to the public to engender trust. These days, “causeless cause marketing” isn’t cutting it anymore. Cone’s study shows that “Securing consumers’ cause-related dollars is no longer a case of simply putting a ribbon on a package or donating a portion of proceeds. In fact, the need for transparency around not only the issue but the intended impact has never been greater.”
The behavior and thinking of major demographic groups supports these findings. For example, Millennials share their lives online through social media — and they expect this same openness from companies. Many Millennials will research a company’s business practices and commitments before supporting its causes, purchasing its products or even applying for a job there.
When it comes to African Americans, “authenticity is paramount,” according to Dr. Rochelle Ford, professor of communications at Howard University. “African Americans are becoming more skeptical of corporate efforts to partner with the black community.” The story is similar with Hispanic Americans, who are generally more brand-loyal when a relationship is emphasized, according to the Hispanic Association on Corporate Responsibility’s Carlos F. Orta: “Once we trust a company, we’re going to stick by it.”
The government is watching you, too. Several states are looking closely at the issue of transparency in cause marketing practices, and some have come up with specific recommendations.
After reviewing questionnaires sent out to 150 companies, New York Attorney General Eric Schneiderman concluded “consumers do not have sufficient information to understand how their purchases will benefit a charity,” and subsequently released the Five Best Practices for Transparent Cause Marketing for use by charities and companies.
Not coincidentally, the American Red Cross, one of the world’s most trusted nonprofits, is also one of the most transparent, with specific requirements for all cause marketing donation programs: “XYZ will donate to the American Red Cross, including the amount of the donation as a flat fee (e.g. $1 for every shirt sold) or a percentage (e.g. 25% of the retail sales price) and the time frame (e.g. from September 1, 2013 until August 31, 2014).”
This specific donation language is clear and prominently placed on all product packaging and hang tags. The public sees exactly what amount or percentage of their purchase is going to the nonprofit partner, and the timeline of the campaign. This transparency creates trust. The thread between transparency and profit is trust.
A recent post on Causecapitalism.com highlights the relationship between transparency and successful business: “By opening up internal operations, successes and failures to the public and to employees, we demonstrate transparency as a company, allowing them to trust us, to recommend us, to tell us when we err, and to choose us again.”
Effective communication is the platform upon which trust and a strong relationship are built. Your communication with your cross-sector partner and your public should be open, honest, and regular. When challenges arise, address them immediately asking: “What can we do to solve this challenge in a way that will strengthen the partnership and further our goals?”
Indeed, working through such challenges with transparency will strengthen the partnership, prepare you for future challenges, and cultivate trust by the public, the crucial component to your campaign’s success. NPT
Bruce Burtch is author of Win-Win for the Greater Good. His email is email@example.com