Dating back several decades to the rise of multinational corporations, the term “Corporate Social Responsibility” has become a buzzword in several years, as a growing number of firms look to take ownership of their actions on the environment, employees, the wider community and other stakeholders beyond their legal responsibilities.

From a fleet perspective, this has included taking a look at the wider effects of the use of company cars in terms of the emissions and also road risk management. However, for some fleets CSR spend has become less of a priority during the economic downturn, as they look to focus on business lines instead.

Yet some experts have said that CSR can become a key differentiator for firms and can lead to improved profitability.

In fact a recent study by the Kenexa High Performance Institute, a division of Kenexa, which is a global provider of business solutions for human resources, shows that organisations that are genuinely committed to CSR substantially outperform those that are not. They are also said to have a higher level of employee engagement and to provide better customer service.

The report analysed the financial metrics of 175 companies and found that those organisations that were most committed to CSR reported an average return on assets that was 19 times higher than the average of those least committed to CSR (a gain of 4.83%, against 0.25%).

For fleets, as well as benefiting the business and staff, there is the business argument that implementing an effective CSR programme will improve the fleet management and generate cost savings.

Sean Bingham, fleet management expert at UK-based Expense Reduction Analysts, says: ‘At first thought you wouldn’t automatically link CSR with cost control, as reducing cost is certainly not the primary goal of a CSR programme. However within a fleet environment, CSR and cost control go hand in hand.’

He goes on to explain: ‘A core focus with fleet operations in terms of Corporate Social Responsibility is centred on the environmental impact of its vehicles. Placing a limit on the amount of CO2 emissions being produced is not only beneficial to the environment, but will also lower the tax burden.’

He adds: ‘Further fuel savings are achievable through behavioural management in training staff to adopt the key rules of eco-driving. Studies have proven that fuel consumption can be reduced by more than 10%. However it is believed that incentives for drivers will be required to maximise the potential savings, which normally requires a considerable administration burden to be taken on.

‘If health and safety is part of your CSR strategy, an effective road risk management programme will have a positive cost impact on insurance premiums, limit the loss of accidental damage excesses, reduce down time of vehicles through repair and ultimately creative a more effective work force.’

He also has the following advice for fleets looking to sharpen up their CSR practices: ‘When it comes to employing strategies to implement a cohesive CSR and cost control programme, a holistic approach needs to be taken which evaluates all the different areas of cost of ownership within the corporate departments responsible for procurement of fleet vehicles. Effective advice and guidance for fleet drivers is also essential to achieve optimum CSR and cost reduction benefits. If you do not have the appropriate cost, purchase and supply management expertise in house, it is worth researching the market place for experts who can offer unbiased and objective advice pertinent to a business’s specific culture.’

Athlon Car Lease also believes that there is a strong link between CSR and cost savings and says that experience has shown that companies can save up to 5% of their fleet cost by making their fleet more sustainable.

President Hans Blink adds: ‘We are continuously improving and extending the services and products that we can offer to prospects and clients. One of the many things we have already developed is the 5-step Sustainable Mobility Plan, which promotes environmental sustainability, but also takes into account an aspect that is of highest importance to our customers: cost efficiency.’

With the sustainable mobility plan, Athlon Car Lease encourages and supports companies to make their fleet more sustainable, and provides advice on how to achieve their CSR and cost reduction targets in five steps. The plan includes several steps to reduce traffic on the streets, such as working from home or using alternative modes of transport like the train, all the way to choosing environmentally-friendly, low-emission or electric vehicles and educating and rewarding drivers for driving fuel efficiently. Pursuing these steps allows companies not only to contribute to the environment and get ahead in reaching their CSR goals, but they are in turn also saving money due to lower fuel expenses, which can be subsequently invested in further CO2 reductions.

‘Through offering all services required to make customers’ fleets more sustainable out of one hand, we believe that the barrier of companies to pursue sustainable fleet management will be substantially lowered,’ explains Mr Blink. ‘One example that we are currently pursuing at Athlon Car Lease, is our programme “CHARGED”, in which we are developing a one-stop-shop for electric vehicles.’

Effective fleet CSR tools

There are also a number of driver training and behaviour monitoring tools at fleets’ disposal to proactively mitigate risk as well as improve corporate image.

Ed Iannuzzi, manager, Client Support Services for Automotive Resources International (ARI), says: ‘Effective web-based driver safety training services are available as comprehensive packages or individually on a standalone basis, depending on a fleet’s specific needs, to identify, target and track high-risk drivers. One example is perception evaluation testing, which can analyse a driver’s individual ability to prioritise potential hazards and thereby identify their propensity for being involved in a collision. 

‘Automatically, follow-up training modules are assigned based on weaknesses assessed in the evaluation process. This kind of programme can minimise risk exposure, reduce a fleet’s total number of accidents, and reduce accident-related costs.

‘Advanced systems that offer universal scoring allow companies to combine various driver assessment inputs such as motor vehicle records, collision incidents, driver monitoring events, etc, in order to arrive at an overall risk assessment for each fleet driver. Such systems often include tracking and reporting capabilities that automatically communicate with trainees via email to ensure they complete their training requirements by the specified due date.’

He adds: ‘Telematics technology is another valuable tool for fleets for monitoring driver behaviour and enforcing policy as it relates to safety and cost control. Driver behaviour modification systems can include a unique combination of in-vehicle, real-time driver alerts for speeding, seat belt usage, sharp turns, hard stops and rapid acceleration. In-cab camera systems allow for visual proof of outside conditions and driver behaviour. These next-level fleet management techniques can reduce a fleet’s unsafe drivers, occurrence of accidents and will bring about improvements in the corporate image and generate cost savings too.’

There may also be other benefits at stake for firms using a CSR programme to address their effects on the environment at large.

Elisa R Durand, asst manager, Strategic Consulting, Environmental and Fuel Strategies at ARI, says: ‘The implementation of an environmental management system that places an emphasis on sustainability will not only bolster an organisation’s reputation as a steward of natural resources, but may also yield opportunities for efficiency improvement.

‘When a company undertakes the process of establishing a baseline, setting measurable goals for improvement – such as utility consumption, or waste generation, for example – new ways of managing these areas can result in long-term cost savings. Although some upfront investment may be required to launch a sustainability initiative, it is possible to achieve cost-savings in the long run. Newer, more efficient technologies (such as HVAC or lighting) or an employee awareness campaign do require a financial outlay and resource commitment. However, in the future, these investments can reap rewards in the form of lower utility bills as a result of increased efficiency and human efforts to reduce consumption.’

She concludes: ‘These internal efforts, and successful achievement of targeted goals, can be publicised and shared with the organisation’s industry. The organisation’s dedication to sustainability may be perceived as a positive indication of continuous improvement, demonstrate its commitment to the pursuit of an effective corporate social responsibility plan, and portray the organisation as a conscientious innovator that will take the same approach with their clients.’

So clearly CSR, in addition as being used as a means to generate business efficiencies, can also play an important role in raising a firm’s profile, with investors and customers alike.

But whether firms address CSR issues to elevate their public image or for ethical reasons or simply because of the improved business practice and cost savings that this may generate, one thing is clear: the concept of CSR has become part of the business landscape.