COVID-19: Tech Providers Demonstrate Corporate Social Responsibility Leadership Now More Than Ever

R. Bhattacharyya

Summary Bullets:

  • The current pandemic has provided the opportunity to broaden the definition of corporate social responsibility (CSDR) and for technology providers to take even greater action.
  • A key question is whether these initiatives will pay off in the long run; the answer is likely ‘yes,’ but much will depend on a company’s track record prior to COVID-19.

The move toward greater corporate social responsibility (CSR) has been taking place for quite some time. Traditional activities that fall into this category are broad, including educational programs, investments in local or underprivileged communities, increased hiring of minorities, and initiatives to reduce carbon footprints or to support environmentally friendly projects. And the list goes on. The current pandemic has provided the opportunity for technology providers to take even greater action and possibly broaden what should be included in the definition of CSR.

One of the bolder moves by a technology organization came very early in the pandemic, when Salesforce CEO Marc Benioff, who is already known for his commitment to promoting greater equality and social causes, announced that his company would not have significant layoffs for 90 days and called on others to do the same. Benioff made the announcement on March 24, even before overall unemployment rates skyrocketed and smaller organizations, particularly tech startups, were forced to cut staff in an effort to reduce expenses. Granted, Salesforce is in the enviable position to be able to take this stance, but the action challenged other organizations to similarly demonstrate that they were putting employees ahead of profits. Salesforce launched several other initiatives as well. It created ‘guiding principles’ for operations during the pandemic and a COVID-19 ‘vision, value, and methods’ statement (both promote employee and customer wellbeing). It also launched: Salesforce Care, a portfolio of new, free, and rapidly deployable solution bundles targeting specific customer segments (such as small business) which provides free access to Salesforce Essentials and Tableau Desktop; and Healthcare, which provides products such as Health Cloud and Salesforce Shield, among others, to emergency and care management providers.

CSR initiatives by many technology providers have extended beyond employee and customer-related actions. Several IT services players announced efforts to support local communities. For example, Cognizant pledged $10 million to support humanitarian and healthcare relief, educational efforts, investments in healthcare infrastructure, and other initiatives. Capgemini’s numerous activities included donations of personal protection equipment, as well as working with hospitals to deploy remote patient monitoring, develop rapid test kits, and use 3D printers to produce face shields. And Wipro, in addition to other efforts, announced that it would transform one of its campuses into a 450-bed hospital dedicated to COVID-19, providing physical infrastructure, medical furniture and equipment, and an administrator and support staff. Similarly, many other IT services providers donated their platforms to healthcare and research organizations.

In an effort to address customer pain points, technology providers also rolled out access to services free for 90 days or restructured payment terms and offered more flexible financing options. While helpful, these programs are a bit self-serving. They ensure that customer relationships are extended and open the door to new opportunities; no one can question their impact on the bottom line in the longer term.

The looming question is whether these efforts will pay off down the road. Will employees and customers remember them as altruistic acts, or will they view them as ultimately self-serving initiatives?

Much of this will likely depend on the company’s record prior to COVID-19. Was the organization already concerned with promoting greater sustainability? Did it already invest in the local community? And did it already create a work environment that demonstrated appreciation for employees and promoted diversity among senior management.

And then, does it even matter?

It appears that it does. Enterprises customers often cite that when prices and features are roughly similar, they prefer to work with a vendor that is easy to do business with and understands their needs. And then, a growing number of investors want to support socially responsibly organizations. Similarly, staff turnover is expensive; therefore, efforts to retain employees make good business sense. Furthermore, millennials often want to feel that they are contributing to the greater societal good and want the organization to which they devote 40+ hours a week to be guided by principles that extend beyond profits.

And finally, the benefits associated with being a thought leader – in any industry – are priceless.

What do you think?

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