An overview of trends and industry forecasts for Corporate Social Investment (CSI) and Community Development - South Africa

1. CSI PROFESSIONALS
BRIEFING 2014
Reana Rossouw
Next Generation Consultants

2. Session One:
Trends and Forecasts 2014

3. Our Vision:
 Increasing Impact and
Enhancing Value
Our Objective:
 We want to know how to
cultivate change more
effectively in a world that
sorely needs it

4. Our context
 Compare practice globally:
 US, Europe, Far East
 Africa (continental)
 South Africa (regional)
 Benchmark against findings of
our Impact Investment Index
 Tracking for the past ten years
 Supported by 45 personal
interviews with industry
practitioners
 What we know:
 CSI has become more strategic
but may need to become
more than that - CATALYTIC
 Too little progress has been
made while the problems we
face continue to grow
 We believe that the work of
the next ten years will have to
build on existing efforts to
include an additional focus on
coordination and adaptation

5. Barriers to change
 Independence and control
 Insularity and inward focus
 Caution and risk aversion
 Time and inertia
 Competition and credit
 The end result:
 A system with no natural
mechanism for coordinating
effort, for learning, for sharing
knowledge about what does and
does not work, or for adapting
to shifting changes
 Isolated successes that are
seldom replicated, new
innovations that replaced old
ones before they had time to
prove themselves, with the
unfortunate end result that
funders and their beneficiaries
are doomed to repeat the same
mistakes again and again

6. 1. A brave new world
 Bigger
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Understand the context
Pick the right tools
Align independent action
Activate networks
Leverage other’s resources
 Better
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Know what works (not)
Keep pace with change
Open up to new inputs/ideas
Share by default
Take smart risks
Evidence: Industry collaboration (National Collaboration Trust on Education);
specific forums for specific focus areas (beyond painting class rooms and the
OVC forum) – Western Cape Donor’s Forum)

7. 2. Flipsides of the coin
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Government in crises
Strains on safety nets
Collapsing service delivery
Weakened social support structures
Sharpened eye on non profit
performance
Rising funder/NGO tensions
Continued legislative reforms
Intense media and public scrutiny
Forced collaborations and mergers
Increasing social activism and
violence
 Increased expenditure on CSI
 Increased public participation
in giving
 More innovation in
development approaches
 Changing funding models
 New localism
 Volunteerism rising and
increasing
 Increased communication on
giving
Evidence: Increased income disparity vs. increased quality of life

8. 3. Lean and Mean
 Impact of the recession:
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Effective
Efficient
Strategic
Less is more
Less is less
 Outcome of the recession:
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Impersonal
Hands-off
Elusive
Exclusive
Abusive
Evidence: Website submissions only – no personal contact – no appointments –
automated responses. More CSI brochures are being printed and distributed than
ever before, sustainability reports on average has 4 pages dedicated to CSI SPENT!
Without a single/person/number/contact/e-mail!

9. 4. War on Ideas
 My flagship is
better/bigger/more expensive
than yours
 Fewer programs
 Bigger programs
 Higher profile programs
 More strategic programs
 More exclusive programs
 More internal programs
Evidence: Most flagship programs are single donor interventions – on average lasts for 2 years –
closely linked to brands – with multimedia advertising support – no communication about
impact – fly by night perception! Unilever – ‘saving life’s’ - not selling soap (Lifebuoy)
Capitec – SWOP Mall – conscious consumerism – recycle, upcycle – on trend

10. 5. The next big thing
 Capacity and leadership
development
 Operating support
 Enterprise development
 Job creation
 Good news: Collaboration is
evident
 Bad news: NGO’s are being
measured on HOW they
spend money not the results
they achieve
 Focus shift from social to
socio economic development
Evidence: Good News: Sponsoring NGO’s for industry events. Prepared to pay on
average 10% operating support. Bad News: It costs on average R1m to create a
single job or start a new enterprise.

11. 6. Green (BLUE) is the new black
 Environmental programs
 Impact from operations
 Impact of climate change
 Risk issues and impact issues
 Short term issues
 Future issues
 Food security
 Water scarcity
 Income/job disparity –
waste/recycling
Evidence: BHP Billiton offsetting 60 tonnes of carbon through the Wildlands Trust:
Question: Is carbon offsetting a social issue / operational issue / risk mitigating issue? Is
building a clinic the result of negative environmental or health impact on communities
(LTO) – risk mitigating strategy or CSI spend or infrastructure / local economic
development?

12. 7. Alphabet Soup
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BBBEE
LTO
GRI
IIRC
IPIECA
ICMM
ISO26000
KINGIII
UNGC
SLP
SED
PRI
IFC
OECD
 Impact of governance and
compliance:
 More due diligence:
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Indicators to measure change
Impact – anecdotal evidence
Assurance – more paperwork
Reporting – evaluation
requires pictures for reports
 New policies, codes of conduct
and strategies
Evidence: More reporting does not mean necessarily mean better reporting –
Practitioners will have to come to grips with the impact of governance, legislation
and reporting requirements AND have their work assured.

13. 8. New Age Stuff
 Social and ethics committees
 Stakeholder engagement
 Community perception
surveys
 Human rights implications
 Social audits
 Baseline studies
 Risk and opportunity studies
 Impact studies
 Beneficiation
 New reports - Board committees oversight
 New reporting lines - Corporate Affairs
 New titles – Community Relations
practitioners, community engagement
practitioners, community liaison officers
 New responsibilities – human rights audits in
programs
 New strategies – linking to and integrating with
NDP, IDP, SLP
 New focus areas – industry commitments
 New criteria – ethics policies, vendor
registration processes, sustainability
credentials (water, energy, labour practices,
ethics policies)
Evidence: Signatories to local and international guidelines and codes
(ICMM and IPIECA) – global policies, local execution. Major impact for
companies moving into Africa

14. 9. Hindsight is perfect sight
 Spectacular failure
 Spectacular success
 Glimpses of brilliance
 Theory of change
 Theory vs. practice
 Process vs. systems
 Outsurance - Pointsmen
 Dial Direct – Pothole Brigade
 Healthcare workers Discovery
 Mama’s - Clover
 Holistic development
 Cradle to grave development
 Lifecycle development
 Lifestage development
Evidence: Previously criticized (low profile) programs have become
‘unmissable’ solutions to social problems – Biggest success stories? Single
focus area and program!

15. 10. Dangerous half truths
 What's good for you may be
bad for them
 What's bad for them maybe
good for you
 Poverty has many dimensions
 Poverty alleviation or
eradication
 Development is hard work
 Development is complex
 Development is expensive
 Development is systemic and
systematic
 Development takes time
Evidence: Most programs have only short term and quantitative impact –
sustainability remains an oxymoron – development requires more than 12
month single cycle/single donor interventions – pass rates is not necessarily
an indication your program worked!

16. 11. 1 to 100 in 10 seconds
 The numbers game
 Jobs
 Pass rates
 Books
 Classes
 Students
 Learners
 Teachers
 Quantitative vs. qualitative
impact
 Negative vs. positive impact
 Intended vs. unintended
impact
 Short term impact vs. long
term impact
Evidence: Sustainability reports only focus on quantitative data – not
aligned to reporting requirements – and no single report speaks about
qualitative impact = actual change. No single integrated report is able to
show the link between community relations and value creation

17. 12. Dichotomies
 Urgency for short term results
and stamina for the long term
 Holding on to autonomy and
looking for opportunities to
coordinate and collaborate
 Insisting on rigor and taking
risks despite uncertainties
 Innovation and creativity
 Responsiveness and
responsibility
 Scalability and focus
 Replicability and results
Evidence: Results of CSI reputation surveys indicated that only 10
companies in the whole country is getting it right! No new corporates on
the top 10 list for 10 years running!

18. 13. Keeping up with the Jones’s
 Asset-based funding
 Seed funding
 For profit funding
 Social enterprises and social
entrepreneurs
 Market-based solutions
 Impact investment
 Collective funding
 Cause related funding
 New words:
 Resilience
 Empowerment
 Capacitating
 Old words:
 Sustainability – sustainable
development = no one knows
what it means or how to do it
or how to prove it
Evidence: Only one in 20 funders will consider new funding approaches
over the next two years. Only one in 30 funders will consider changing
their funding criteria within the next 2 years.

19. 14. Volunteerism is cool
 Growth in volunteerism
 Everyone is a hero
 Everyone can make a
difference
 Everyone wants to make a
difference
 Employee engagement is the
latest and coolest new tool in
the box
 It starts with me
 It is all about me
 Rewarding volunteerism
Evidence: One in three corporates now have some form of facilitated
employee volunteer program – and one in five have a dedicated
practitioner to volunteerism. One in two corporates reward
volunteerism!

20. 15. Please give that man a fish
 Give a man a fish…
 Give a man a rod…
 Educate a women and you ….
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Cash is no longer king
Education is no longer cool
HIV is no longer an issue
Babies are more sustainable
than old people
 Cost benefit analysis is the new
thing
 Sustainability of fishing
sources
 Endangered fish on the red list
 Impact of climate change on
fishing industry
 Fishing licenses
 All the kings horses and all the
kings men could not save
NEMO
Question: What happens after the fish is caught? Give a man a fish and
feed him for a day; teach a man to fish and you feed him for a life time;
show him how to use Google search and he can teach himself how to
fish!

21. 16. I know what you did last summer
 Unlikely bedfellows
 NUMSA, EFF, AMCU
 Righttoknow
 Solidarity
 Benchmarks and Lonmin
 Community activism is on the
up
 Community activism may
affect you negatively
 Community activism may
destroy your legacy
 Burning down of schools and
libraries, clinics
Evidence: Funding of political parties, funding of political leaders, funding of
trade unions, funding of advocacy groups – what you report, where you
report, do you read your own company’s sustainability/integrated reports,
when last did you scan the media for information about your company?

22. 17. Local is lekker – Joe & Jane Soap
 Urban vs. rural funding
 The new donor/philanthropist
= Joe Soap
 Local Hero’s (volunteers)
 (Not) In my back yard
 Giving without boarders
(Zimbabwe and diaspora)
 Crowdsourcing
 Local food gardens / markets /
produce
 Local recycling
 Local products
 Request from ordinary citizens
(not a formal NGO) who are
the new facilitators and
fundraisers
Evidence: Communities are organizing themselves: But no-one
remembers who gave them the hand up! Khayalitsha cookies, Mielies,
Men at the Side of the Road, Shanduka, Changemakers, Santa’s boxes,
Kylie Mycroft, Claire Reed

23. 18. Status Quo is not an option
 Investment = Return
 Responsive = Proactive
 Needs focused = Outcomes
focused
 Transaction based =
Relationship based
 Organisational funding = Issue
funding
 Cash giving = Value chain
integration
 Management = Leadership
 Most companies have some
form of M&E
 Only one in ten companies
conduct some form of impact
study
 Less than half of companies
record the number of
beneficiaries
 Less than 20% of companies
do baseline studies
Evidence: Becoming more strategic does not necessarily mean you have
increased impact. Poorest regions still gets the least funding, national
programs does not mean national impact. Companies moving into
Africa (30% of all corporates) – uses the same strategy, focus areas,
process, methodology as in South Africa.

24. 19. A horse, a horse, my kingdom for a
horse
 Shared value & shared risk
 Risk vs. impact
 Ethics, morals, values
 The elusive sustainability
point
 Disaster relief vs.
infrastructure
 Minority vs. majority funding
 Gender based funding
 Old vs. young
 Jobs vs. food
 Books vs. labs
 Urban vs. rural
 Crime vs. rehabilitation
 Art vs. houses
Evidence: Strategies have not become diversified – but focus areas
have. Strategic CSI needs to re-invent itself – it is not about MORE of
the SAME. Neither is it about doing MORE with LESS. Look out for the
new word – not STRATEGIC CSI – But CATALYTIC CSI

25. 20. Two hills ahead
 The pressure to measure
 What you know
 What you don’t know
 What you don’t know you
don’t know
 Are you sure you want to
know?
 Doing what matters
 Doing what is right
 Doing it the right way
 Accountability
 Flexibility
 Authenticity
 Engaged
 Engage widely
 Research deeply
 Compare extensively
 Collaborate creatively
 Communicate honestly
 Innovate flexibly
Question: Towards Best Practice – what will it take? WHO is getting it right – Nedbank
Foundation, FirstRand Group (FNB, RMB, Wesbank & Firstrand Foundation)
Evidence: Homegrown best practice: Global Awards – Transnet Phelophepa and BHP
Billiton Treepreneur Project

26. Advice for the Future
 Trap Number 1: Once we have
figured out the business model
and strategy, we don’t need to
worry about it anymore!
 Trap Number 2: Grow, baby,
grow!
 Trap Number 3: If it worked for
them, it will work for us!
 Align for Success - In figuring out
the right roles and resource
priorities, the biggest challenge for
many community foundations is
aligning values, strategic priorities,
business model choices, and
organizational culture.
 Adapt to Thrive - Community
practitioners will always be
challenged to adapt to serve an
ever-changing set of community
and donor priorities, focusing on
impact today and permanence as
an enduring community resource.

27. Questions and Discussion
 What did we miss?
 Examples of your own
practice?
 What will it take?
 What do we need to do?

28. Contact
 Reana Rossouw
 Next Generation Consultants - Specialists in Development
 E-mail: rrossouw@nextgeneration.co.za
 Web: www.nextgeneration.co.za
 PLEASE NOTE: THIS PRESENTATION IS PART OF A LARGER BODY OF
RESEARCH! THIS INFORMATION IS COPYWRITED AND THE
INTELLECTUAL PROPERTY OF NEXT GENERATION CONSULTANTS.