B-CauseB-Cause

By Michelle Govender

Don’t cast-off CSI as “junk status” sets in – there’s too much to gain

Business needs charity as much as charity needs business.  While corporate South Africa grapples with what it really means to run a business in an economy that has been downgraded to ‘junk status’, non-profit organisations are taking a closer look at what impact the tightening of belts will have on communities who rely heavily on charitable support to get by.

“While the knee-jerk reaction may be to reign in CSI spend, when times are financially tight you also don’t want to alienate business partners, consumers or employees  – in fact research shows that meaningful brands on average gain 46% more share of wallet,” says Michelle Govender, GM: Strategic Marketing at B-Cause, a consultancy focused on cause-related marketing. It may sound soft – but meaningfulness matters in 2017.  In fact, meaningful brands outperform the stock market by 133% .

Businesses spent R8.1 billion on corporate social investment (CSI) in South Africa during the 2014/15 financial year.  Alarmingly this amounted to zero growth in total corporate expenditure on social development from the previous year.   The knock-on effect of junk status and a weaker rand could further flatten corporate allocations to communities in need.  “To the people on the ground, this could have a potentially devastating effect,” says Michelle.  “Business is getting tougher, margins are shrinking, and the usual starting place for budget cuts is on charitable giving.  However, corporate SA has a lot to gain by maintaining a high profile CSI strategy,” she adds.

The positive impact of CSI for business

In the past 12 months, consumers indicated that 63% bought a product with a social benefit, 53% of people boycotted companies that behaved irresponsibly and 37% researched a company’s support for social issues.

“Junk status means there will be less money for government spending on education‚ health‚ national debt‚ social grants and infrastructure.  This is why B-Cause is lobbying for corporates to continue their much needed funding of NGOs during tough economic times. Meaningful brands deliver 100% more outcomes on the key performance indicators (KPIs) and that’s certainly worth considering before slashing CSI budgets,” says Michelle.

It’s a two-way street

“Many social issues are increasing, not decreasing, yet CSI budgets seem to be getting smaller and smaller,” says Richard Allen, CEO of Door of Hope, one of the foremost homes in Johannesburg for abandoned, abused and orphaned babies.  “It may still be a little early to tell how the junk status is impacting available budgets, but it would not be a stretch to say that is certainly will.”  Non-government organisations (NGOs) realise that gaining share of corporate wallets is a two-way street – the NGOs need to meet the needs of the funder, so that the funder can meet the needs of social development.

Buhle Phiri, Corporate Partnerships Manager of Save the Children South Africa agrees: “We haven’t felt the impact of the downgrade to junk status yet because current budgets are in place, however next year we could feel the pinch –  NGOs definitely have their work cut out in coming months.  It is vital to show that we are capable and can be trusted.  Having good, professional governance and financial practice goes a long way.”

 

A positive flip-side

Staying positive in the face of adversity is a visible trait of NGOs and their common forward thinking approach is refreshingly upbeat.  Many corporates are moving over to the Triple Bottom Line evaluation structure to measure their success by using social, environmental and financial metrics.

“Interestingly, it is the corporate donor that is showing greater integrity and responsibility to the world and its people, that is finding resonance with customers and noticing that their business is well supported because of it,” says Door of Hope’s Richard Allen.  He says there is a need for more creativity and innovation in fundraising efforts – “which isn’t easy when you don’t have the manpower, resources, skills or finance to secure such necessities.  However, the NGOs that are going to succeed, I believe, are the ones who will find a way to do this and do it well.”

Transparency in the way that funds are used is a major part of negotiating corporate funding partnerships. “We find that funders want their money to go to specific programmes and projects, so that they can see real impact and value in their contribution,” says Buhle Phiri of Save the Children. “In negotiating we often provide a ratio or split in funding according to the request of the funder.  For instance, 70% goes to the project and 30% to operating costs.  We understand why this is important to them and try as best we can to tailor each project and work with each corporate’s funding requirement,” she says.

Door of Hope stresses that the challenge with operational costs is that they are so critical to the organisation’s success – “we look after babies 24/7 and our biggest expense is salaries for our care-givers who love and care for them, but these costs are often overlooked when it comes to donor funding.”  Water, lights, maintenance, insurance and salaries tend to be the biggest funding challenge.

No matter the economic outlook: “We can’t give up,” says Phiri, “it is tough for people in communities out there, so the more hands on deck the better!”  She says that the younger generation is very much in tune with the greater good.   “We need to tap into these pockets of people who are coming up in the ranks as the world shifts and social media creates platforms for social consciousness more than ever before.”

CSI – a test of business character

The pressure is on for business SA to develop well-managed CSI strategies that deliver social currency, and uplift and empower beneficiaries on a sustainable basis.  “This is particularly relevant given South Africa’s massive social challenges and economic disparities,” says Michelle Govender of B-Cause. She says it is important that CSI strategies support business objectives by enhancing relationships with key stakeholders and customers.  “There is an opportunity to do good that has real impact and effect, and at the same time, provides the business with a distinct competitive advantage in a parity market,” explains Govender.

In South Africa the corporate sector needs to take a hard look at what defines a successful company  and how the CSI budget fits in to reflect this –  in these tougher economic times it is a true test of brand and reputational character.

By Michelle Govender

Charity starts at home…and at work

There’s an old idiom that says charity starts at home, but as the payroll giving trend starts taking off in South Africa, charity may very well find its place at work, giving new meaning to the concept of ‘give as you earn’.

 

Already well-established in the UK and US, payroll giving is gaining traction in South Africa, offering employers a simple but effective way to involve their employees in social investment initiatives while building a shared culture of caring for vulnerable groups and communities.  Payroll giving is facilitated by employers, and enables employees to donate a chosen amount to a supported charity straight from their gross salary before it is taxed each month, with a minimum of hassle.

 

“Payroll Giving is growing in South Africa, and is founded on the basis that many small donations, given on a recurring basis, with minimal administration required by the employer, can amount to a substantial and meaningful impact for a needy charity. If only 10% of South Africa’s 9.2 million employed people contributed R50 a month of their salaries, it would amount to R46-million every month, or R552million every year invested in charitable programmes. Many companies are also challenging employees to support such programmes, with the promise of matching and doubling up on whatever employees donate in their personal capacities,” explains Michelle Govender, Director of Strategic Marketing at B-Cause.

 

B-Cause is a specialist agency in South Africa that focuses specifically on cause-related marketing, social responsibility and sustainability issues, matching corporate brands with appropriate social and public benefit organisations.

 

“One of the greatest appeals of payroll giving is that employees have the peace of mind that all the checks and balances are in place, and that approved charities supported by their employer have been through the process of confirming their legitimacy and that the funds will be used effectively.   There is also the cohesion that comes from working towards supporting a common vision where everyone’s smaller contributions can make a huge social difference as a collective effort. Finally, not all employees are able to invest their time or skills in worthy causes as often as they would like to, so payroll giving provides an opportunity to be part of a well-managed charitable effort, on a consistent basis without any demands on their time,” adds Michelle.

 

While payroll giving initially took off in larger employers, small and medium commercial entities are also seeing the opportunity to rally their people around a common cause, with a minimum of effort and costs to company to administer the effort. At the same time, it provides the business with a distinct competitive advantage to differentiate in an increasingly socially-conscious consumer market. In fact, progressive business strategists have long been advocating for corporate social investment to be managed as aspects of core business strategy.

 

Entrench a culture of giving

There is an important internal marketing job to be done in creating and maintaining the payroll giving momentum. B-Cause works with employers to introduce and demonstrate to staff how easy it is to make a difference with payroll giving.  Invest the marketing resources to promote the payroll giving opportunities, and then get leadership involved to challenge employees and set the bar.  It’s also vital that staff get to see the results of their contributions, so provide regular feedback on how their hard earned money has benefitted a needy cause.

Payroll giving drives employee engagement 

An often overlooked but valuable benefit of payroll giving is that of employee engagement.

“Payroll Giving is one of many important employee engagement tools which are vital in the age of millennials. According to a 2015 Cone Communications study, millennials are far more engaged with social causes than their older counterparts.  Millennials are more likely to work for a company based on its corporate social responsibility commitments, and will even be willing to take a drop in salary in order to work for a socially responsible company that they admire when deciding where to work.  Millennials expect brands to integrate sustainable and responsible practices into all that they do. Brands that are embracing CSI as a business-imperative strategy, not only because it’s the right thing to do, but because it’s also the profitable thing to do, tend to retain skilled staff for longer, and enjoy a greater share of the consumer wallet,” explains Michelle.

For the employer brand, besides the ease with which it can be integrated into the payroll system, payroll giving also brings structure to its CSI strategies. With payroll giving, you have the consistency of donor income that can be earmarked for specific charitable projects, allowing for long-term and structured forward planning which is worth gold for both donor and recipient organisations,” explains Michelle.

In embarking on a payroll giving strategy, B-Cause helps companies to identify NPOs that align with the strategic imperatives and nature of the business, and ensure that there is a good fit for the cause and beneficiaries that would be best served by the partnership. “We focus on creating and sustaining mutually beneficial relationships between corporates, employees and NGOs – relationships that will last and become deeply ingrained in the mind of the organisation, its people and the public,” concludes Michelle.

 

By Michelle Govender

Corporate Social Investment – Can Companies Do Well by Doing Good?

South African businesses invested R8.1billion in corporate social investment (CSI) during the 2014/15 financial year, an important financial quantum on the triple bottom line that continues to grow.  Typically, SA’s largest JSE firms approach CSI as well-engineered, strategic and sustainable initiatives that tie back strongly to the business objectives, BBBEE and community stakeholder relationships.

“But for a huge mid-section of firms, CSI is often knee-jerk, unsustainable, non-aligned to the strategic imperatives of the business and the important touch points of the local communities, customers and employees.  As a result, the real grass roots impact of such CSI projects are lost and unrealised, despite significant investments of money, time and resources,” says Michelle Govender, Director: Strategic Marketing at B-Cause, SA’s only dedicated consultancy focused on cause-related marketing.

Whilst the aim of commercial marketing is financial and the aim of social marketing is ‘social good’, the two are not mutually exclusive. The reality is that if correctly deployed and entrenched throughout the business, CSI provides an opportunity for improved profitability, growth, employee engagement, consumer loyalty and competitive advantage.

“The pressure is on all businesses – and especially given South Africa’s massive social challenges and economic disparities – for well-managed CSI strategies that deliver social currency, uplift and empower beneficiaries on a sustainable basis, and support business objectives by enhancing relationships with key stakeholders and customers.  There is an opportunity to do good that has real impact and effect, and at the same time, provides the business with a distinct competitive advantage in a parity market,” explains Michelle.

 

Is CSI investment realising tangible, grass roots results?
According to the CSI Handbook 18th Edition (Published by Trialogue) total CSI in South Africa in 2014/15 was R8.1 billion.  This only measures the CSI spend of Enterprise organisations, but when you factor in tier two and three companies, it’s likely that this figure is well over R10billion. And yet it’s very hard to track the impact that this investment is having and the kudos the companies are receiving for the hard-earned money they are spending. So where is the cause and effect?  This massive disconnect means that those still in need and brands are missing out on the opportunity to “do well by doing good”.

“In many companies, we see initiatives that are dispersed throughout the company with no over-arching, sustainable plan for ongoing engagement.  Each year, we see hastily coordinated staff field trips on Mandela Day or a ‘global day of service’ to paint, garden or spend time with CSI beneficiaries, only to pack up again and head back to the office until the next year.  What real impact, if any, is this having for the firm, the beneficiaries, communities and employees? Surely, collectively if we all do our part, we should achieve more than simply painting a wall or building a fence once-off?” says Michelle.

In embarking on a sustainable CSI strategy, B-Cause helps companies to identify NPOs that align with the strategic imperatives and nature of the business, and ensure that there is a good fit for the cause and beneficiaries that would be best served by the partnership. “We focus on creating and sustaining mutually beneficial relationships between corporates and NGOs, relationships that will last and become deeply ingrained in the mind of the organisation, the employees as well as the public,” she adds.

 

Strategic Philanthropy is more important than ever for employees and customers
The CSI strategy needs to be an entrenched part of the business, headed by a senior management person who can ensure that it receives corporate oversight, a role that is typically headed by the head of Human Resources or Operations.  Strong leadership and support for CSI initiatives at c-suite level is crucial, not only from a commitment perspective, but from a budget allocation too.  Top-level support is fundamental to reinforce the intrinsic value of CSI programs for the business, and to ensure that both short term and long term goals are achieved in achieving a partnership where true transformation can occur for South Africa’s most disadvantaged citizens.

Within the South African context, B-BBEE ties in strongly with corporate social investment.  CSI initiatives that assist Black beneficiaries can favourably affect your BEE Scorecard. CSI spend is regulated at a target of 1% of net profit after tax as part of the revised Broad-Based Black Economic Empowerment Codes (BBBEE).  It is important to note that CSI and SED (Socio-economic development) are 2 different elements of the scorecard. Socio-economic development is more than just assisting the disadvantaged with a meal or a warm bed. It refers to access to the economy. CSR departments need to bear this in mind when developing programmes with their scorecard in mind.

Companies can continue to earn points through charitable giving as before, but there is additional emphasis on developing skills, preferential procurement, enterprise development and socio-economic development.  In fact, research by Trialogue shows that the growth in CSI development is linked to three main reasons – moral imperative, reputation and the Department of Trade and Industry’s (DTI’s) Broad-based Black Economic Empowerment (BBBEE) codes.

“It’s also an important factor in employee engagement and positioning the company as an employer of choice.  According to a 2015 Cone communications study, millennials are more engaged with social causes than their older counterparts and they will easily hop online to condemn a brand that they felt was behaving socially irresponsibly.   Millennials are also more likely to work for a company based on its corporate social responsibility commitments, and will even be willing to take a drop in salary in order to work for a socially responsible company that they admire when deciding where to work.  Millennials are also the generation that easily migrate to social media in order for their voices to be heard,” says Michelle.

“Consumers are equally demanding more accountability from brands for their social impact.  Consumers increasingly expect brands to integrate sustainable and responsible practices into all that they do. For example, many companies are starting to make procurement decisions around socially responsible behaviour and corporate values.  Strategic social responsibility and cause-related marketing are very effective marketing tools that help to grow your social impact as well as your business. Brands are embracing CSI as a business-imperative strategy, not only because it’s the right thing to do, but because it’s also the profitable thing to do. When done right, with integrity and commitment to actually making a difference, brands tend to receive a greater share of the consumers wallet,” she adds.

With the growing trend in cause-related marketing, companies will do well to bridge the gap between growing their reputations by aligning and committing to the charities that would make a good fit. By positioning the right products and services with the right cause and designing, developing and deploying strategic corporate social responsibility (CSR) and cause related marketing (CRM) efforts, B-Cause helps achieve the brand’s reputation growth and broaden the positive social impact.

“CSI is here to stay and when one considers the social and economic landscape South Africa currently finds itself in, the need for cohesive, integrated CSI strategies from SA’s corporate sector has never been more crucial.  By strategically managing what is essentially a philanthropic venture, every business can maximize its purpose and benefits to society, create real, grass roots societal value where it is needed most, and fulfil on all its stakeholder mandates,” concludes Michelle.

By Avy Maselwa

Shining the spotlight on rural women, food and poverty eradication

With just the words, “finish your food, children are starving in Africa”, the dispute between my parents and I where food was concerned was eternally over. I remained confused for years to come about “Africa” being made to seem far away from my home in Mdantsane in the Eastern Cape of South Africa. And more importantly how finishing my food would help other hungry children.

The one truth continues to be that the age old adage that has coaxed children world over into finishing their food is a reality. Indeed, there are people in the world who do not have access to food.

Over the next few days we will observe some key dates: International Day of Rural Women (15 October), World Food Day (16 of October) and the International Day for the Eradication of Poverty (17 October).

However, the issue is no longer just about food scarcity, but also about how the poorest communities (which are disproportionately African) have to contend with the impact of climate and environmental change on methods of food production.

Rural women take the lead in food production

International Day of Rural Women is aimed at recognising and enhancing the importance of rural women in agricultural and economic development. The general consensus is that rural women often take the leading role in food production and the image of a rural woman is never divorced from labour and in particular labour that yields communal food.

Food deprivation and poverty

In South Africa, the increasing limitation on the ability of poorer communities, especially rural communities to rely on subsistence farming, has led to a larger and more absolute reliance of people on social welfare for access to basic foods and often times, this is hardly enough to sufficiently feed whole families.

However food deprivation is just one consequence of poverty. People are stripped of their dignity when they are unable to access means of survival like adequate water and sanitation, education, employment and generally global and local citizenship rights which ultimately take material shape in economic terms.

The International Day for Eradication of Poverty is more than just a call for empathy from those who are more privileged.

So what happens next?

It is primarily a space for engagement in an effort to break the cycle of poverty and ultimately influence global policy on the needs of the poor. Importantly, the voices of the poor need to be given the majority weight in this discussion, because no one better understands the needs of the poor better than the poor themselves.

 

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