As consumers become more socially conscious, the expectation for financial institutions to demonstrate corporate social responsibility has grown. Neglecting social responsibility can result in a loss of customers and harm to your institution’s brand.
A failure to invest in social responsibility can mean missed opportunities for positive growth and potentially disastrous results for your financial institution.
When it comes to social responsibility, transparency is key. While traditional financial institutions operate mainly behind the scenes, consumers want to know their money is going toward ethical practices. Recent scandals have left customers questioning the values of financial institutions, leading to a loss of trust and business. For example, Wells Fargo’s fake account scandal resulted in the loss of millions of dollars and damage to their reputation. Had Wells Fargo invested in more socially responsible practices, they may have avoided this tarnishing of their brand.
Leading Customers AWAY
In addition to potential economic loss, neglecting social responsibility can alienate customers who are looking to support companies that align with their personal values. In a recent survey, over 80% of customers said they would consider switching to a brand that is more socially responsible. Financial institutions that prioritize social responsibility may attract new customers who are looking to align their financial decisions with their values.
Missing Growth Opportunities
Aside from customer loyalty, investing in social responsibility can lead to positive growth opportunities. Financial institutions that focus on social responsibility have the potential to access new markets and diversify their customer base. Additionally, investing in social responsibility can lead to cost savings through sustainable practices and the reduction of reputation-damaging incidents.
Furthermore, prioritizing social responsibility can result in a more engaged and motivated workforce. Studies show that employees who work for socially responsible companies are more likely to feel fulfilled and connected to their work. This can result in lower turnover rates and a more productive workforce.
Avoid Neglecting Social Responsibility
Neglecting social responsibility can be detrimental to your financial institution. Failing to focus on social responsibility can result in economic loss, damage to your brand’s reputation, and an alienated customer base.
On the other hand, prioritizing social responsibility can lead to growth opportunities, cost savings, and a more motivated workforce. By investing in social responsibility, your financial institution can align with customer values and be a force for positive change.