Companies wanting to make a contribution to society through their community programmes have typically looked for projects that have obvious social outcomes, such as BT’s Better World campaign or Marks & Spencer’s Marks & Start programme. Then they worry about how to strike the right balance between traditional benefit to society (philanthropy) and benefit to company (the so-called “business case”).
In international community involvement – that is western companies deciding the right approach in developing and emerging markets – it’s increasingly clear that the projects with the best social returns are in fact economically based. Simply put, poverty is at the root of most social issues, and often low (or no) income is what is driving environmentally damaging behaviour like deforestation. Getting the economy moving upwards is the key to everything, although this is perhaps counterintuitive to some anti-business NGOs.
That said, not all economic growth benefits people locally, hence the interest in social enterprises. Danone’s announcement, reported on the next page, is especially interesting, as it also gives the lie to two widely-held misconceptions: that CCI is an Anglo-Saxon preoccupation (as French companies ‘don’t do’ community) and that it’s best never to mention in front of investors.
This focus in the developing world mirrors the growing interest in social enterprises in western home markets too. However here, most such initiatives are social projects struggling to make any sort of economically viable case, whereas in the developing world, it’s fundamental micro-business propositions having a direct ‘people’ impact. The bottom line is, in developing and emerging markets it is through getting the economics right that you can have the biggest social and environmental impacts.
Related News
Village phone direct
The Grameen Foundation and Nokia launched Village Phone Direct in December, a scheme which allows microfinance institutions to offer mobile communication technology to the communities in which they operate. Both partners will develop a Village Phone Business Kit, consisting of a Nokia mobile phone, a booster antenna, re-charging equipment and custom-designed cables to connect all the components. The kits can be bought from the microfinance institutions by rural micro-entrepreneurs.
The micro-entrepreneur will take out a loan at the same time, become the Village Phone operator, and rent the use of the phone on a per-call basis to people in the community. The operator will make a profit and also repay the loan to the microfinance institute. Pilots for the scheme are planned in India, Haiti, Angola and Pakistan. Contact Grameen Foundation 00 1 202 628 3560 www.grameenfoundation.org
Danone communities
French food group Danone is asking its shareholders to create a business development fund that will invest in social enterprises worldwide. The fund, called danone.communities, will focus investments on business initiatives with a social aim especially with regard to healthy nutrition for deprived communities. The first investment will be in the Grameen Danone project – a partnership between Danone and Grameen Group that endeavours to bring healthy food to low income, nutritionally deprived people in Bangladesh. The fund aims to make a number of investments annually in similar ventures in different parts of the world.
To support the fund, Danone’s board of directors has set up a social responsibility committee, which will monitor the group-wide utilisation of best practice, resources and skills to drive the fund and social responsibility. Funding decisions will be made by looking at the social impact of the projects on local communities – their contributions to public health, the reduction of malnutrition, the alleviation of poverty, their environmental significance and the scope for international deployment.
Danone shareholders will have the option to re-invest all or part of their dividends in the fund in the form of social dividends, while employees also will be given the chance to invest part of their profit-sharing entitlements. Meanwhile, individual investors and institutions sharing an interest in this approach to development will also have the opportunity to invest. The fund’s board of directors will be chaired by Franck Riboud, chairman and chief executive of Danone, and Muhammed Yunus, founder of Grameen Bank will be vice-chairman. Contact Groupe Danone 00 33 1 44 35 20 76 www.danone.com
Brain gain
HP and UNESCO have launched Piloting Solutions for Reversing Brain Drain into Brain Gain for Africa – a project that aims to bring computing technology to universities in Algeria, Ghana, Nigeria, Senegal and Zimbabwe. The scheme, launched in November 2006, hopes to re-establish links between researchers and scientists that remained in their native countries and those that left. The intention is to form research networks and funding opportunities.
African countries have suffered greatly from the emigration of skilled professionals, scientists, academics and researchers, who are estimated to be leaving the continent at the rate of 20,000 a year. Director-general of UNESCO, Koïchiro Matsuura, said: “Such collaborative projects will enable us to significantly reduce the devastating effects of brain drain in developing countries.”
The education ministries of the countries involved will select the universities that will benefit from the project. Universities with important information technology departments will get preference. HP will provide equipment as well as training and support. UNESCO will be responsible for administration and co-ordination as well as the evaluation of results. Contact HP 020 7949 0300 www.hp.com; UNESCO www.unesco.org
Community
Young voices
Young people will soon have a voice with the help of BT and The Guardian. The communications provider and newspaper have joined forces to form BT Young Voices – a scheme designed to give young people a safe and secure environment in which to discuss and influence the issues that matter to them.
The project is now looking for 12-15 young people, between the ages of 11-21, to form the panel. They will be supported by The Guardian’s online experts and will be responsible for launching a website and providing input and guidance for the online community. The young people will also have the opportunity to meet with Guardian journalists to discuss editorial content and they will also form part of the BT Better World Campaign.
Nominations for the panel are now open and close on January 31. The shortlist will be announced in February and the panel will be announced in March. Two of the panel members will also be chosen from the children of BT’s 100,000 employees. The BT Better World Campaign aims to ensure that all young people in Britain have the skills and opportunities to improve the way they communicate. Contact BT Better World Campaign 0870 333 0373 www.bteducation.org; The Guardian 020 7278 2332 www.guardian.co.uk; BT Young Voiceswww.guardian.co.uk/btyoungvoices
That’s the spirit
Sage (UK) has won an international award for its commitment to the local community. After collecting the Best Community Spirit Award at the ceremony in Las Vegas, Michael Moore, the company’s CSR administrator said: “At Sage, CSR is about putting something back into the local community and going the extra mile.” Sage supports local charities from its offices, through employee volunteering and charity dress days. The awards recognised the best contact centres globally, with each finalist represented not only their company but also their region of the world.
Contact Sage (UK) 0191 294 3000 www.sage.co.uk
Developing a social equity market
A report by the Charities Aid Foundation and the New Economics Foundation has advocated the development of a social equity market. Developing a Social Equity Capital Market 2006 suggests a number of steps that will need to be taken in order to build such a market – the establishment of an online forum where information can be discussed and shared, the development of a social capital market prototype, exploring possible partnerships with already existing markets, building links with ethical investors, making technical support and skills available to start-up social businesses and encouraging and expanding awareness about businesses with a social purpose. Contact CAF 01732 520 000 www.cafonline.org; New Economics Foundation 020 7820 6300 www.neweconomics.org
Contributions
Co-op community
The Co-operative Group announced that it had given £450,000 to community groups in 2006 though the members’ dividend scheme.
The Co-op membership scheme allows consumers to join the co-operative for £1 and through this each member receives a card. The card totals points whenever the customer uses one of Co-op’s businesses (such as Travelcare, Smile, The Co-operative Bank). The points are converted into a share of the profits. Members can choose to either keep the money or to donate it to community projects. This year 1.4m members chose the latter route. Contact Co-op 0161 834 1212 www.co-op.co.uk/corporate
The xtra factor
Home Retail Group – the owner of Argos and Homebase – is the first UK employer to introduce a new payroll giving scheme to its employees. Giving Payroll Giving – The Xtra Factor, developed by the Charities Trust, allows employees to increase their donations by a nominal amount once a year. For example, if the company decides to increase donations by 3%, every £1 that an employee donates will be increased to £1.03. The aim is to maximise the money that goes to charity. Contact Home Retail Group 01908 600 291 www.homeretailgroup.com; Charities Trust 0870 708 7878 www.charitiestrust.org
In brief
Royal Mail Group employees raised £250,000 for Help the Hospices, which was then matched by a donation of £250,000 by Royal Mail Group on January 10. Royal Mail Group is partnered with Help the Hospices for 3 years and postal staff have been linked up with local hospices to organise fundraising activities and to volunteer their time. Contact Royal Mail Group 0175 238 7112 www.royalmail.com
The Northern Rock Foundation is to give out loans worth £1m in north east England and Cumbria. The loans will go to individuals, businesses and community organisations in disadvantaged areas and will form part of the foundation’s Building Better Lenders scheme. Recipients in December include the Northern Youth Venture Fund and Street North East. Contact Northern Rock Foundation 0191 284 8412 www.nr-foundation.org.uk
Accenture giving
Accenture is donating $600,000 to victims of Hurricane Katrina. Made up of $62,000 from the Accenture Foundation and then $538,000 of in-kind consulting and related services. The money will go to the Louisiana Association of Nonprofit Organisations to support the launch of its New Orleans non-profit central resource co-operative. The aim of the co-operative is to provide basic operations and technology services to voluntary organisations in and around New Orleans. Contact Accenture 020 7844 4000 www.accenture.com; Louisiana Association of Nonprofit Organizations 00 1 225 343 5266 www.lano.org
Arts
Business investment in the arts levels off
Private investment in the UK arts sector has increased to £529.5m in 2005/06, from £507.9m a year earlier, although business investment itself has levelled out at £153.4m. Private Investment in the Arts, published by Arts & Business on December 11, found that individual giving to the arts increased as did that of trusts and foundations. However, business investment remained static.
Colin Tweedy, chief executive of Arts & Business, said: “The challenge for A&B is to ensure that corporate giving does not lag behind other forms. Corporate giving is a key part of the private investment mix.”
The report also concluded that London accounts for 74% of all investment with 17 of the top 20 recipients based in the city. The most money was invested in heritage, followed by galleries, museums and theatres. Libraries and archives saw the biggest increase in private investment in 2006.
“There is more money going to the arts from the private sector than ever before. This is a great achievement, but Arts & Business will not be satisfied until we can help all arts find the resources and ideas to bring in additional private investment,” Tweedy said. “We need to make sure the arts are in the best position to work with the private sector and to convince more businesses to engage with the arts to unlock their full potential. 83% of the arts would have had their audiences limited without private investment. We need it to grow – it is a force for good.”
A&B has always looked for more strategic relationships between businesses and the arts, promoting, advocating and brokering formal employee volunteering partnerships between top managers and directors of companies and cultural organisations. For the first time this year, A&B valued the in-kind contribution these employees make to the UK cultural sector, amounting to £3.9m in time and expertise in 2005/2006. Most of this support came from the legal, financial and business services sectors. Contact Arts & Business 020 7378 8143 www.AandB.org.uk
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