Corporate Social Investment - Part One: Rules of Engagement

Wednesday, November 2, 2011 - 15:11

Social investment should benefit business first, then society, the environment and engage the best minds in a company. A single social investment that benefits, shareholders, employees, suppliers, society and the environment stands to deliver the most return on social investment

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This event might be very exciting as topics are quite interesting. I was planning to visit it but I could not reach there as it Corporate social responsibility is one of the integrated parts of business models. There are certain corporate areas which are targeted as social investment areas most probably in south Africa. Even today also legacy occurs in different forms in south Africa.
Very well said. I think it was Jack Welch that said that "poor people make bad customers" as his explanation why even organisations who are not particularly "caring" should invest in communities that are related to their core business.

Before the advent of the welfare state in Great Britain, extreme family poverty was dealt with through the philanthropy of rich persons to whom such human misery was unbearable.

This charity was given only to those whom they regarded as the 'deserving poor'.  In practice, this meant that charity was given only to those whom the feudal lords regarded as having demonstrated an acceptance of the indignity of their social and economic status.

In this context, philanthropy does not arise from principles of human rights, human solidarity or social advancement and progress, but rather, a false altruism with an unintended consequence of breeding dependency and keeping the poor, poor.

This legacy continues in South Africa today in many forms. It is called corporate social investment.

If not misguided altruists, what do you call legions of highly skilled company executives and staff taking time off work to pack meals, ostensibly to “Stop Hunger Now”? Surely, this makes sense in a major crisis or disaster situation, not as a team building publicity stunt or what others have correctly referred to as ‘poverty pornography’.

These publicity stunts take place while it is now clear even to the most careless observer that our country has serious capacity problems in local government relating to financial, engineering and project management skills that result in service delivery strikes, not to mention poor leadership skills at our schools. Instead, why don’t these highly skilled executives and staff tackle real systemic issues that underwrite poverty?

These unsustainable initiatives are often referred to as ubuntu. This kind of behaviour is not African. It is not ubuntu. In African tradition, people who do not have cattle to till the land get assisted by others to plough and plant the land in what is called ‘ILima’. They assume full responsibility to weed it until harvesting. My contention therefore is that we are beholden by a deep-rooted-bleeding heart colonial mindset which ends up doing more harm than good. To change the mindset, requires new rules of engagement:

Language

It all starts with the language you use. If you start talking about projects you will soon get lost in adjudicating whose needs are the greatest and who is more ‘deserving’ of your alms and handouts. If you talk about social investment, you will think about what will bring about a social return on investment, effectively and efficiently.

Proper Self Interest

Social investment that benefits business first, then society and the environment, and engage the best minds in a company. It becomes long-term commitment rather than flavours of the moment or a CEO pet project.  A financial services company with customers deep in debt is shooting itself in the foot if it does not have financial education in its social investment portfolio. GE used Ecomagination to build a new business by increasing awareness of how the company was using renewable energy and reducing carbon emissions. This is now a multibillion enterprise by itself. Long before global warming became front page news, Toyota accepted that the conventional petrol engine harmed the environment. The company worked out how much harm their engines caused and created a strategy to mitigate the harm caused, while researching new hybrid models that have less environmental impact.

Be true to your brand, values and traditions

A corporate social investment must strengthen the brand, inside-out.  You cannot be a caring organisation outside when you are callous, ruthless and uncaring inside. To be relevant, a social investment portfolio must speak to your strategic objectives, your brand, your values and traditions.

For Virgin, it makes sense to focus on entrepreneurship as a celebration of its origins and its founder’s unbounded entrepreneurial spirit. Suntory, a bestselling Japanese whiskey supports arts and has built an art museum and an opera house in line with its key value of harmony. Today, Research in Motion’s Blackberry Messenger is central to democracy and social change.

Multi-Stakeholder benefits

A single social investment that benefits shareholders, employees, suppliers, society and the environment stands to deliver the most return on social investment.  Despite divisions from within companies, consumer perceptions of good companies are informed by a totality of how it behaves towards all of its stakeholders, including its employees, customers, suppliers, other companies it collaborates or competes with, and the local and global community in which it operates.

The argument I hope I have made here is not: “We know what society’s problems are, and as corporates, we have solutions - our solutions.”  It is: “We know what our problems are, we want to work with other social partners to solve them and in the process advance society and preserve our environment for future generations.”  That is how corporate social investment (CSI) becomes relevant to the organisation. That is how you become relevant to stakeholders – by being honest about your true intentions. The problem with CSI practitioners is that they often do not know what the strategic issues are in their own business. As a result, they remain irrelevant, a side issue and a cost centre, rather than part of value creation.

Real change can only come about when we embrace real change in how we think and perceive our actions and our world. To paraphrase Peter Senge (The Necessary Revolution): while institutions matter, how they operate arises from how people in those institutions operate and how they think and act. As Albert Einstein said, "We cannot solve problems by using the same kind of thinking we used when we created them."  

- Andile Ncontsa is the CEO of Litha Communications (www.litha-communications.co.za). In addition to communications and public relations, Litha consults on corporate social investment, stakeholder management, sustainability, dialogue and social mobilisation.

- This is Part One of a Four Part Series: Part Two: The growth and emergence of the South African Nanny State; Part Three: Valuing Community Assets for Social Development; Part Four: Putting it together – The Golden Triangle of Social Development.

Author(s): 
Andile Ncontsa

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