Last year, education made up the biggest part of the corporate social investment of South African companies, continuing the trend that companies believe investing in a culture of learning makes the most sense. Almost all the big hitters in corporate social investment (CSI) invested in the education sector.
The top five CSI sectors in the 2004/05 financial year — according to The CSI Handbook published by Trialogue — were education (36% of total CSI spend), health (12%), social development (12%), training (10%) and job creation and small business development (10%).
Apart from education, HIV/Aids also drew a large response from corporates. When investing in health, 80% of corporate CSI funding went to HIV/Aids projects. About R424million was given to health projects.
CSI giant Anglo American spent R58million on CSI in 2004/05. The handbook says the company perceived to have the biggest corporate social investment budget spent mainly on education, HIV/Aids and welfare, with some funding going to the arts and the environment. In that year Anglo spent 35% on education, 24% on health and 21% on the arts and the environment.
The company is widely seen to be the biggest contributor to education, and the leading corporate contributor to the fight against HIV/Aids, by its peers and non-profit organisations.
The second biggest corporate involved in HIV/Aids contributions, Old Mutual, dedicated 20% of its R15million budget towards the epidemic, while 15% was invested in education.
Telkom is another company with a big CSI budget. Though it spent 23% on education, almost half of the big parastatal’s budget went towards infrastructure development in 2005.
The Transnet Foundation, with a budget of R106million in 2004/05, spent 28% of its CSI budget on education and 24% on job creation.
Another government parastatal, Eskom, had a CSI budget of R50million in 2004/05 and spent most of it (39%) on infrastructure development and 22% on health. Only 9% went towards education.
The banking sector also contributes big budgets every year and it, too, is focused on education. Two years ago, Absa worked with a budget of R19million and Nedcor contributed R39million to CSI. About a quarter of this budget went to education. Nedcor also invested heavily in welfare (30%).
Absa again spent an equal amount of its budget on education and health (28%). Every year, Absa allocates 0,5% of its post-tax profit to the Absa Foundation; this has grown from R18million in 2005 to R30million in 2006.
In its spending on education, the bank focuses on two core areas: early child development and the training of educators in maths and science, a critical area for the development of South Africa. Absa provides workshops, training manuals and classroom facilities to train the teachers and spent almost R10million in this area last year.
For early child development, the bank set aside R4,9million to establish community-based day care centres. Absa’s spokesperson for CSI, Jacqueline de Winnaar, said the bank has identified this area as a CSI priority.
‘Research has shown that children who benefit from early child development are more likely to cope well at school, go on to tertiary education and become economically productive,” she said.
SAB had R20million to spend and most of that (56%) went towards education and training, with job creation pocketing 10% of the big brewery’s spend.
‘SAB has developed its thinking about social investment in line with the prevailing needs of the country. Education, for example, was thought of as a strategic focus area,” it said in describing how it allocated funds.
Maths and science development is a key focus area of CSI education projects. Ann Bernstein, from the Centre for Development and Enterprise, says the institute’s research shows the failure to improve maths and science education is probably the most significant obstacle to African advancement in South Africa.
‘Government policy reforms over the past 10 years have not increased the supply of black maths and science graduates,” she writes in an article in The CSI Handbook. ‘If current trends continue, we face a crisis.”
She calls for a ‘determined partnership between public and private sector leadership” to come together if the country is to succeed in building its maths and science resources.
Companies are well aware of the call to support maths and science development in South Africa, and a host of big companies are involved in the area, including Alexander Forbes, AngloGold Ashanti, Arivia.kom, AVI, Barloworld, BHP Billiton, BoE, BP, Denel Ericsson, FNB, Impala Platinum, Investec, Johnnic, Merck, Mintek, MTN, Nampak, Land Bank, National Brands, National Ports Authority, Palabora Foundation, RMB, SAA, SAB, Sappi and Standard Bank.
Arts and culture is low on the list of priorities, with the sector receiving only 5% of corporate CSI funds. The sector’s budget, however, has improved somewhat. Here Standard Bank and Nedcor are seen as the biggest investors. Environment also received a mere 4% of the pie.
But the Cinderella of CSI is housing. It has the least number of corporate CSI programmes and only receives R25million. Safety and security, another critical area in South Africa, is more or less on par with the housing sector when it comes to funding.
Figures supplied by annual reports and The CSI Handbook