Organisations, particularly those that are listed and are under pressure to be seen to be ploughing back the proceeds of their business into communities, find themselves confused by semantics when it comes to choosing and implementing corporate social responsibility/investment.
public relations with Lenox Mhlanga
A colleague put it this way, corporate social responsibility (CSR) is nice to have, while corporate social investment (CSI) is a must have. One would have the feeling that the former was kind of foistered or legislated on companies reluctant to share the loot.
Or alternatively, a situation where companies, faced with the prying eyes of advocates, decide on a piecemeal gesture of philanthropy, hoping to get them off their back.
Yet, in an era where the buying decisions of consumers are increasingly being influenced by how responsibly companies behave as regards their conduct of business, the need for a more strategic approach to making a credible impact on the societies they operate in has become more pertinent.
The profile of a regional bank toes this line when it says that through its CSI initiatives, it aims to create meaningful and lasting mutual benefits for the communities it serves and for its business.
They recognise that contributing to the improvement of the socio-economic circumstances of the communities in which they operate; enhances their corporate reputation, contributes positively to the morale of their people (presumably their employees), and demonstrates that they are locally relevant and responsive to social and economic imperatives.
In other words, they place CSI as an integral aspect of how they do business, in the heart of their corporate strategy. The Stanford University School of Business buttresses this aspect by putting across CSI as being about integrating into core business processes and stakeholder management, systems and behaviours that create both social and corporate value.
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The World Business Council for Sustainable Business Council, is more magnanimous and all encompassing by defining CSI as the continuing commitment by business to behave ethically and contribute to sustainable economic development while improving the quality of life of the workforce and their families, as well as of the local community and society.
Zimbabwean companies have varied CSI programmes that are spread out across several sectors. There is a semblance of appreciation of the fundamental differences between CSI and CSR, which is more about an organisation’s obligation to contribute to the socio-economic upliftment of the community and to consider the interests of stakeholders, while being cognisant of the consequences of their business activities.
Those that show more commitment realise that mandate by dedicating a percentage of after tax profit to their CSI programmes, which is quite a significant investment. The areas to which companies dedicated towards socio-economic upliftment invest in, include, health, education, entrepreneurship, the environment, sports development, the arts, staff volunteerism and of course the more popular philanthropy or charity.
However, because of the manner in which these programmes are planned and run, most companies find themselves having difficulties in coordinating varied activities, proving whether they were worth their investment and also , the elephant in the room, that of sustainability.
Having a hotchpotch of activities that have very little bearing on company imperatives, and create a dependency syndrome instead of being sustainable can pose a threat to its reputation, likely creating the impression that they were trying to cover up something.
The most common challenge faced in CSI programmes under the current environment is two-fold — efficiently co-ordinating CSI programmes in a holistic manner and, creating and demonstrating value that justified the investment made by companies.
I worked for a company that poured money into a tiger-fishing tournament at the expense of a more visible and impactful programme of funding orphanages that wanted to grow vegetables to cut down their huge food bills. The lack of introspection on what was a “nice-to-have” event within a changing political and economic cost the company a lot of respect.
A more well-thought-out approach that co-ordinates CSI activities in a way that will create visible and measurable value is advisable. This requires bravery in chopping off those activities that on the surface make the company look good in favour of more development-centred ones that will leave a more lasting impression long after support is terminated.
A client saw the need for damage control services after the new owners failed to see the benefit both to the company’s reputation and bottom line. They failed to plan for the day when the sponsorship would have to be stopped, and worse still sustainably equip the beneficiaries in a way that they would be left standing on their feet. They were forced to extend the sponsorship by an additional year, in order to carefully manage a painless and less tumultuous separation.
The formulation of a holistic CSI strategy becomes essential. Such a strategy should align CSI activities to company goals, adding value to both the organisation and to the targeted communities.
It should also create the right balance between being proactive and being responsive in CSI activities so as to make them sustainable and achieve clear focus, resilience and readiness to be rendered redundant when communities achieve the desired level of self-reliance.
There is also the need to determine which programmes are philanthropic, and those that are commercially driven, in order to make it easier to identify, establish and incorporate best practice in CSI.
In a pitch to another potential client, we propose “fewer, but better” approaches that would see them investing in a realistic number of CSI projects providing clear focus. That demanded a strategic shift from a “nice to have” to a “must have” approach.
All this requires a CSI strategic planning process that establishes value creation, impactful corporate philanthropy while managing the possible risks associated with the projects, including reputational ones.
Lenox Mhlanga is a communication specialist with over 16 years experience in the field. He has worked for the World Bank Group and lectured in public relations at the National University of Science an Technology. He is an associate with Magna Carta Reputation Management Consultants. He can be contacted at [email protected]
