The COVID-19 crisis has brought us to a moment of reckoning. Today, it’s clear that the world’s most pressing challenges can’t be solved by governments alone. Society is turning to businesses to help with critical issues like access to food, health services and supplies, educational materials and economic support.
Yet the very businesses society relies on are also impacted by the crisis. The economic consequences are already prevalent. Social distancing has caused millions of Americans to lose their jobs, while also reducing the demand for many goods and services – which is causing a significant slowdown in the global economy.
Over the coming months, companies will continue to amass pressure from all directions. Consumers expect brands they support to help their communities. Meanwhile, investors are already shifting their focus on ESG criteria as they realize the positive return on investment (ROI) from Environmental, Social and Governance (ESG) stocks. Companies will also need to identify ways to engage their workforce, as many continue to face the challenges posed by remote work, layoffs or other strenuous circumstances.
What If One Of The Solutions Was In Your Purchasing Power?
As CEOs, CFOs and other executives grapple with these challenges, procurement has a unique opportunity to step up and strategically support their entire organization. As companies urgently seek ways to protect their customers, clients and communities, procurement has a unique opportunity to support the people and places most impacted by COVID-19 – all while generating new business value for their organization.
It’s Time To Source With Social Impact
Chief Procurement Officers and procurement teams can leverage their immense purchasing power to fund organizations on the frontlines of the COVID-19 crisis. By adopting social impact sourcing – the process in which a supplier agrees to direct a small percentage of their total transaction to a nonprofit, social enterprise or NGO mutually agreed upon with the buyer – procurement teams can generate entirely new sources of funding for COVID-19 relief efforts. Not only can this supplement other philanthropic activities or charitable donations, but it can actually help the firm create cross-company value benefitting human resources (HR), investor relations (IR), marketing and communications, corporate social responsibility (CSR) and sustainability.
Givewith’s COVID-19 Response Initiative
Givewith enables companies to easily embed social impact into their sourcing and procurement processes to fund nonprofits, social enterprises and NGOs. In response to the crisis, Givewith has developed a COVID-19 Response Initiative with support from Boston Consulting Group and Sourcing Industry Group (SIG), allowing companies to route a small percentage of their B2B transactions to fund pre-vetted social impact organizations.
In return, both the buyer and seller receive valuable assets for their business, including metrics on the services provided to people in need during the crisis and a variety of high-quality storytelling content. Videos, photos and press releases are afforded to businesses to share the impact with their customers, employees, communities and other key stakeholders. In fact, research by BCG shows that companies that use these assets can see an increase in employee engagement and retention up to 5% to 7% - a boost in Net Promoter Score (NPS) by up to seven points - and positively influenced ESG ratings.
So why would suppliers be willing to underwrite these social impacts at no cost to the buyer? Suppliers benefit too, by seeing an increase in sales up to 7% and a better return on investment compared with other client acquisition tools like advertising, marketing, PR, events or white papers. Since social impact has a better ROI for the supplier, thereby improving their profit margin, both the buyer and suppliers see greater business value.
An Initiative To Quickly Catalyze Impact
For companies interested in joining the COVID-19 response initiative, Givewith is waiving its typical transaction fees and platform subscription fees until September 1, 2020, so that 100% of the funding generated by these transactions will go to social impact organizations tackling the COVID-19 crisis.
To ensure the health and longevity of companies and their communities, we need new social impact solutions that deliver growth and value for businesses while also creating a robust and sustainable funding stream to address the fallout from COVID-19 – and, going forward, systemic issues like climate change, educational inequality or disparities in wealth. The time is now for companies to step up – and procurement can play a strategic role in enabling their company to do so.