/ 26 October 2001

Values in corporate social investment

Colleen du Toit revisits the issues that gave rise to the formation of the South African Grantmakers’ Association

a second look

From its inception the association has sought to facilitate ethical outcomes in grantmaking through collaboration, cooperation and networking. It was with these values that the organisation was founded in 1995, and that participative ethos is still very much at its heart.

It is in this spirit that we reflect, with one of our working partners, the Charities Aid Foundation Southern Africa, and one of our members, the Standard Bank Foundation, on the values that permeate new paradigm social investment activities, and how the collaborative model can be used to shape and enrich the process of corporate social investment.

Although some still argue that involvement in social development is not a proper concern of business, the tide is definitely turning on that current.

A case in point was the annual Black Management Forum conference, where the theme was Socially Responsible Capitalism: Is it Possible? The idea that business has a broader “societal responsibility” or “citizenship” role is strengthening with the development of the global economy. Indeed, these ideas are not new.

Peter Drucker, the father of modern management theory, asserted many years ago that citizenship in the corporate sense is more than just a legal term. It is an inherently political concept, meaning active commitment, responsibility and making a difference in the community, the society, the country and ultimately in the world.

Corporations have a long tradition of involvement in community development in South Africa. These activities are currently broadening and deepening in response to both the realisation of the complexity of real social and economic transformation and a growing recognition of the need for closer cooperation and partnerships with both the implementers and the ultimate beneficiaries of development programmes. There is a new awareness of the role that business can play in contributing to social change and a new appreciation of the multiplicity of resources aside from financial that corporations can bring to societal growth.

These are time, talent, expertise and influence practical contributions of the “corporate citizenship” model being adopted by many of the more visionary private-sector organisations. It is now acknowledged that there are, in addition to the ethical and value-based rationales, definite practical business reasons for corporations to be good corporate citizens. Among these is the ability to attract and retain quality employees, devoted customers and appropriate business partners.

One of the most innovative manifestations of the new model is a greater role for staff in social investment activities. This is taking place in a number of ways, from direct giving to contributions of time, talent and expertise through working hand-in-hand with grantees. Staff involvement, especially in the non-financial aspects of development programmes, helps to build the capacity of NGO partners and beneficiary organisations, while simultaneously providing an enriching experience to staff.

The aid foundation is assisting corporate clients to establish formal employee-involvement schemes. By providing expert assistance to shape and manage these programmes, it contributes to the creativity and innovation of corporate social responsibility activities while taking over much of the management and administrative burden. The aid foundation also creates links of joint responsibility and learning between the giving programmes and the beneficiary NGOs. This cooperative approach helps to ensure that real partnerships are formed, maximising benefit for all parties.

These path-breaking initiatives reflect international trends in corporate social responsibility, where companies are moving away from pure philanthropy towards strategies of integration, combining business growth, ethical concerns and the energy of their employees and other stakeholders. For instance, one in three top United Kingdom companies enable their staff to engage in some form of social involvement, and in the United States nine out of 10 companies encourage volunteerism.

South African companies are now joining this trend. At Absa bank staff will soon be enabled to give directly from their salaries to an HIV/Aids programme that the company will match up to R1-million.

Afrox employees have acquired new skills as they plan the staff’s involvement with organisations that work with children from previously disadvantaged communities.

Last year the Standard Bank Foundation engaged staff countrywide in its community development objectives by challenging them to raise money for the emergency services wing at the Red Cross Children’s Hospital. This project was implemented in partnership with four other companies, the Cape Argus as the main sponsor, with Pick ‘n Pay and I&J. Standard Bank staff from branches all over South Africa built morale as they competed for a grand prize at the end of the campaign.

This project is a real example of the benefits of cooperation and partnership. Apart from the collaboration with other companies, the campaign also elicited support from many different units within the bank itself. Other Standard Bank sponsorship activities such as the Joy of Jazz festival and One Day cricket series were linked to the campaign, and exciting merchandising, including a life-size cut-out of the hospital mascot, was developed and placed in all the branches countrywide.

This in turn drew in the bank’s clients, many of whom also made donations to the campaign. The result of this combined initiative was that the bank far exceeded its target, finally raising R600 000, thus making a significant contribution to the development of the Children’s Hospital.

While the business climate is confident, it is easy to make the case for social responsibility activities. But if these contributions are not measured and assessed it will be difficult to justify their existence when profits are down. While happy pictures of beneficiaries in an annual report are unlikely to sway a financially threatened company’s chairperson, an accurate report of business leverage gained through social investment programmes could do the trick.

From the association’s perspective we will continue to advocate for integration of the necessities of business growth and effective delivery of development programmes, with a value base reflected in socially accountable business practice and sustainable development initiatives. This model is characterised by collaborative approaches to social problems and a promising emphasis on values of relationship, cooperation and collective innovation.

Colleen du Toit is executive director of the South African Grantmakers’ Association