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Posts Tagged ‘Corporate Social Responsibility’

thumb_shutterstock_268078274_1024-800x450 - Partnerships

When we think of philanthropy, images that immediately come to mind are galas and golf tournaments, photos of oversized cheques and smiles, wealthy socialites, high-powered business people and CEOs of non-profit organizations.

The list of social problems and causes – from homelessness to saving the trees – are not going away any time soon.  We know that relying on tax dollars and an already strained public sector bureaucracy won’t solve these problems.   This is why it is not surprising that there are more than 170,000 charities in Canada.  All of them need our money.  And most of us want to be part of the solution.

According to Imagine Canada, we donate $10.6 billion to charities and non-profits and 12.5 million of us   volunteer 2.1 billion hours of our time, which translates to 1.1 million full-time jobs.

As the need to tackle and resolve social issues continues to grow, it is not surprising that 76% of business leaders surveyed by Imagine Canada said that it is difficult to respond favourably to the increasing requests for donations, while 38% said that too many charities are trying to solicit money for the same cause.

Visit the community relations page on the websites of most private sector corporations and you get the same message – We receive numerous worthy requests for donations, however we are only able to support a limited number that align with our charitable vision – and the list of causes that the corporation supports follows.

It’s time to rethink philanthropy. 

Shift the thinking from giving grants and donations to creating private-public sector partnerships. 

In my previous article, I suggested that non-profits should raise funds by helping for-profit organizations be successful.  In this article, I will suggest how corporations, entrepreneurs and professionals in the private sector can contribute to resolving the root causes of social problems by partnering with non-profit organizations, governments and social enterprises.

Implementing innovative solutions through private-public sector partnerships

Private-public sector partnerships are really an expanded form of philanthropy.  Each partner leverages their respective area of expertise.  The result is usually the creation of an innovative solution that neither partner could successfully deliver on their own.   When compared with public sector institutions, private sector corporations generally have stronger capabilities in communications, access to capital, resources to support research and product development, expertise in logistics and far reaching distribution channels.  The public sector can leverage these capabilities and benefit from the private sector’s focus on measured performance and outcomes, particularly in areas such as healthcare where public sector management has produced less than optimal results.

In my experience in the healthcare sector, I have seen private-public sector partnerships work successfully.  Innovative, efficient technologies are being used to resolve problems of overcrowding in emergency departments, collaboration among multiple healthcare providers and supporting chronic disease patients self-manage their health.  All of this has been done without burdensome financial investments or job losses.  For example, all New Brunswick hospitals are now linked to the province’s integrated pharmaceutical supply chain which is co-ordinated through McKesson Canada’s Moncton distribution centre. This is an innovative way of increasing efficiencies in the healthcare system, ensuring patient safety and creating jobs and cost savings.

According to McKinsey & Company, although many private sector corporations tend to approach these partnerships as a purely philanthropic endeavor, their participation can create a virtuous cycle of mutual benefit for all concerned.  Benefits include increased demand for a company’s products and services, a mechanism for joint investment and risk-sharing to create new markets or products. In addition, the partnership can deepen a company’s understanding of key markets and develop valuable networks for future business development.

Purpose-driven impact investment

Social entrepreneurs aim to provide a ‘return to society’ by reducing the impact of poverty, improving access to health, education and technology and protecting the environment, without maximizing profits.  It is estimated that there are 25,000 social enterprises in Canada.  With two thirds of millennials saying that their investments should reflect their social, political and environmental views, we can expect the number of social entrepreneurs to increase.

For-profit organizations and entrepreneurs should consider impact investing as part of their corporate social responsibility programs.  Impact investing combines traditional investing and philanthropy to create social change and financial return.

One way of doing this is by investing in the Social Venture Exchange (SVX).  SVX connects entrepreneurs and organizations seeking to tackle social problems with investors who want to create social impact while generating a financial return.  Another option is to create a social enterprise as a subsidiary of the for-profit organization, established for the purpose of driving social change, with different investment and profit objectives.

Incentivizing employees

When formal partnerships and investing are not feasible, private sector corporations should consider incentivizing their employees to provide pro-bono services to non-profit organizations, particularly on boards and working committees.  Incentives commonly used are the matching of funds raised and financial donations in exchange for employees’ volunteer time.  This is not only beneficial to the non-profit organization, but also for the private sector corporation and its employees.

Employees who volunteer their professional expertise without pay through services such as consulting mandates and project management, benefit from the experience and knowledge gained as well as networking opportunities.  These professionals also gain access to information and insights about economic trends that could potentially provide business opportunities for product innovations, new markets and clients.

Business sustainability is linked to community well-being

Rather than focusing only on short-term profits, businesses should be equally concerned about their long-term sustainability and resilience.

Broadening the scope of philanthropy to include partnerships, impact investing and employee incentives to address social problems is, in my opinion, the key to business sustainability.

Sustainable businesses that can surmount the challenges of sudden changes in the market will survive in the long run if they are connected to healthy economic, social and environmental systems. These businesses will create economic value by contributing to strong communities in which the adverse effects of poverty, ill-health and environmental harm are minimized.  In the long-run, when the public, private and non-profit sectors work together in partnership, we create a culture of communal solidarity in which all citizens have a fair chance to have a good quality of life.

Further reading –

McKinsey & Company Report on Public-Private Partnerships – Harnessing the private sector’s unique ability to enhance social impact

The Canadian Social Entrepreneurship Foundation website

 

Camille Isaacs-Morell is a marketing professional with an insatiable curiosity to learn more, to do better and to make a difference in the world.

www.camilleisaacsmorell.com

See the BIG picture. Focus on what’s important.

@Camille21162

 

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Y DES FEMMES DeFI CARIATIF BANQUE SCOTIA

Photo: YWCA Montreal team at Scotiabank Charity Challenge / Défi Caritatif Montreal 2015

I used to think that 13 was an unlucky number, but I changed my mind a few years ago.  A brand awareness survey found that 13% of non-client respondents were likely to do business with our company because it sponsored community events and charities they cared about.

Our corporate marketing team got lucky because the 13% result surpassed expectations, justified budget renewal and provided proof that our corporate philanthropy program benefited business goals.

According to Imagine Canada, a national charitable organization that represents the charitable sector, charities and non-profits receive around $2.8 billion from corporations.  The majority of corporations contribute to charities because they understand that healthy communities are good for business.

But corporate philanthropy is becoming more challenging.  And many of the more than 150,000 charitable organizations in Canada are down on their luck.

Thirty-eight percent of companies said that too many charities are trying to solicit money for the same cause.  Traditional cheque book philanthropy is rapidly being replaced by strategic partnerships that benefit both the community and corporate donors.

With shrinking government funding, charities are challenged to find the best way of raising funds from corporate and individual donors.   But this presents an opportunity for charities to find unique and creative ways to raise the funds needed for survival.

How to raise funds for charity?  Help corporations to be successful

A few suggestions that charitable organizations may want to consider…

Pride of association

Charitable organizations can support business by bringing together donors at in-person events to raise funds and network.  Out of this comes pride of association with like-minded peers who share the same concerns and commitment to the charitable cause.

  • A good example is the United Way of Ottawa’s GenNEXT Giving Circle.  United Way organizes networking and fundraising events and initiatives where young people can learn about the needs in their community, volunteer their time, and put their dollars to work where they will have the greatest impact.

Shared community of buyers and donors

Charitable organizations can also support client engagement and expand the number of clients for corporations.  By creating strategic partnerships charities and corporations can launch major events to promote products and build public awareness of the charity’s cause, with the intention of building a shared community of donors and clients.

  • A few years ago, The Salvation Army partnered with Montreal-based designers and staged a fashion show to raise funds for L’Abri d’espoir, a shelter for abused women and their children. The event was used to leverage the brands of the charity and of the fashion designers to create a shared community of buyers and donors who support the cause of protecting women from violence.   

Community and employee engagement

Apart from soliciting donations from corporations who care about their causes, charitable organizations should also ask corporations to volunteer their expertise.  Charitable organizations can organize employee volunteer activities that support employee engagement and strengthen teamwork.

  • According to Volunteer Canada, employer-supported volunteering (ESV) is emerging as a regular practice among many of today’s employers seeking to give back to the community. ESV activities and programs are a new “shared value” approach, helping businesses strengthen community relationships and improve employee engagement. They also give non-profits access to new resources and skills while allowing employees to refine and enhance their skills and expand their networks.

Sharing information for thought leadership

Charitable organizations are well-placed to provide valuable data and insights on the causes they advocate and the services they provide.  This information can be shared with thought leaders and persons of influence who have access to the podiums at thought leadership events.    Many chambers of commerce and think tanks host events attended by the audiences that are likely to become interested in the charitable organizations’ causes.  Through thought leadership, corporations can increase their reputation as experts in a particular industry or as key contributors to the quest for solutions in fields such as healthcare and economic development.

Adopt business practices

Although well-intentioned tactics can be used to solicit financial support, charities cannot rely on luck and goodwill.

The common element in all of these suggestions is the creation of relationships with the aim of engaging corporations in committed partnerships that lead to sustained support for charitable organizations.

Like for-profit corporations, charitable organizations must adopt business practices to increase awareness by creating differentiated messages and developing relationships that provide a mutual exchange of benefits.  This requires deliberate planning with the aim of achieving specific outcomes that are good for charities, businesses and communities.

See the BIG picture.  Focus on what’s important.

www.camilleisaacsmorell.com 

@Camille21162

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When corporations cause harm to the society, their corporate licences can be revoked, fines and other sanctions can be imposed under the law or society can withdraw its patronage and profits, placing the corporation’s existence in jeopardy.

Many corporations invest significant resources in philanthropic acts which are collectively packaged and promoted as corporate social responsibility (CSR).  CSR reports offer the public some proof that corporations are acting responsibly and are contributing to the well-being of the society.

Some corporations have established corporate codes of ethics to set standards of business practice that go above the base-line requirements of the law.  In addition, corporations define moral values that shape the corporate culture, with the expectation that these values will be evidenced in the personal and professional conduct of employees.

We now live in an information age in which corporations are under constant public scrutiny.  The actions and implied intentions of corporate agents are very often judged, using moral and ethical principles as the standard, and not just the base-line requirements of the law or the content of CSR reports.

A case in point

Citizens of Lac Mégantic, Québec, were outraged at the delayed response of Ed Burkhardt, president of MMA, the company whose derailed train carrying crude oil devastated their small town.  During his first (and only?) visit to Lac Mégantic five days after the disaster, Mr. Burkhardt focused his communication in his brief contact with the population, on potential legal liabilities and insurance claims, blaming an employee and implying that the fire department may have played a role in the disaster.  The widespread outrage at Mr. Burkhardt’s reaction is understandable and justified.  His behaviour demonstrated his concerns were primarily focused on base-line legal responsibilities.  And yes, there is much that is ethically and morally wrong with a corporation’s president enjoying the comfort and safety of his office and home many miles away from a disaster area where hundreds of people remain homeless, jobless and in the case of nearly 50 people, lifeless, as a result of the corporation’s actions – regardless of who eventually is found to be legally liable for the disaster.

The BIG picture

Corporations must accept that they are not only legal entities with legal obligations.  Corporations have moral and ethical responsibilities to ensure that their actions, whether intentionally performed or accidentally caused, do not harm the society.  This, in my view, is the BIG picture.

Putting public safety above profits is the true test of whether or not a corporation is acting in a morally responsible fashion.  The swift response and remedial actions of Johnson and Johnson in the Tylenol capsule crisis  in spite of multi-million revenue losses, demonstrated that corporation’s recognition of its self-imposed obligation to avoid harming the public even though it did not directly cause the contamination of the capsules.

Focus on what’s important

Because moral and ethical responsibilities are self-imposed, corporations should find specific, clearly defined ways and means of ensuring that they are fulfilling these responsibilities.  A few suggestions:

  • Annual training for employees on the code of ethics – Each employee should review and sign the code of ethics, attesting to their understanding and compliance.  Part of the training should include likely scenarios in which employees will need to apply the corporation’s ethical and moral standards.
  • A moral audit committee – Establish a committee that addresses situations that present ethical and moral dilemmas for employees and for the corporation.  In addition the committee should periodically review the ethical and legal implications of the corporation’s business practices.  For example: pricing and special promotions, supplier relationships and the award of contracts, competitive positioning in advertising and potential conflicts of interest in talent acquisition.
  • Whistleblower’s hotline – The provision of a secure way for employees to disclose business practices and employee behaviour that are contrary to the company’s code of ethics and corporate values.
  • Protocol for crisis management – The protocol should include guidelines for transparent communication and codes of conduct for the corporation’s representatives that focus on empathetic, remedial actions and intentions of the corporation.

 

See the BIG picture.  Focus on what’s important.

www.camilleisaacsmorell.com

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So does corporate social responsibility. Values-based community engagement boosts employee retention by adding meaning.

The proverb “charity begins at home” tells us that in order to extend a helping hand, we need to make sure that our own house is in order first.  That inherent wisdom is valuable in the corporate world too.

 Corporate social responsibility (CSR) has evolved from charitable contributions and philanthropy to the expectation that corporations are obligated to act responsibly in support of society’s well-being.  CSR reports offer the public some proof that corporations are acting responsibly and are continuing to earn the right to exist in the society that supports their business. 

A 2008 Imagine Canada report, Corporate Community Investment Practices, Motivations and Challenges: Findings from the Canada Survey of Business Contributions to Community, noted that 71% of business leaders surveyed agreed that charities and non-profit organizations generally improve the quality of life in Canada.  The same report stated that even more (79%) strongly agreed that businesses and non-profit organizations can mutually benefit from collaborative relationships. 

Many businesses report on their CSR programmes.  BMO Financial Group reports on its multi-level literacy programme as does Microsoft  on their youth and humanitarian response programs.  The reporting draws attention to efforts designed to improve the lives of citizens at home and abroad.  

Corporations need to ensure that their employees are treated with the same care and commitment that they extend to the community through CSR programs. Actions that enhance and preserve the quality of the social and economic well-being of employees can demonstrate corporate commitment to CSR. 

Québec’s Desjardins Group is a great example of this, topping the Corporate Knights list of the “Best 50 Corporate Citizens in Canada for 2012.”  Part of what makes Desjardins stand out is a dedication to reducing the greenhouse gas emissions of its 42,500-person workforce.  The company offers shuttle buses between offices, discounts on a bike sharing programme, a company carpool program and incentives to use public transit.  As well, executive compensation is linked to the achievement of the company’s sustainability-related performance targets.

Values are vital

It is important for a company to establish a clear connection between its values and the aims and objectives of its CSR programs and policies.  Values inspire employee and community engagement with CSR programming.  The alignment of a CSR program with corporate values helps ensure that future decisions will be made in a consistent manner.  Employee training and support in a values-based CSR program is consistent and encourages active employee involvement.

Hitachi is a company with a Canadian division that falls in line with an eight-point global policy that all business units and employees are expected to adhere to, with the goal of promoting a sustainable society and future.  That includes open disclosure and transparency, doing business on the principles of fairness, sincerity and acting with the “utmost respect for human rights,” while pursuing a high sense of corporate ethics.

Integrating organizational development objectives with CSR activities benefits the corporation, its employees and the community.  Involvement of employees in CSR projects can support the strengthening of teams, cross-fertilization of talent and development of technical skills. 

Knightsbridge, a human capital management firm, had 300 of its employees assemble 60 bicycles to donate to the Salvation Army as a team building exercise.   Employees were not only enriched by the team-building experience, but also by having the opportunity to reach out to the children who actually came to the event in order to choose their bicycle.

Employees are an important part of the process when it comes to socially responsible business decisions.  The opportunity to apply decision-making skills in CSR projects is possibly the best way for companies to demonstrate a genuine commitment to their employees and communities.  Also, corporations should reward employees for recommending socially responsible improvements in product development, manufacturing, packaging and distribution. 

A global approach has been explored by some larger companies.  International Corporate Volunteer programmes provide opportunities for employees to work with small businesses, government agencies, non-profit and charity organizations, and associations in varied industries. These programmes are win-win, providing benefits for sponsoring companies, employees, and local clients in key emerging markets. IBM, Accenture, PriceWaterhouseCoopers, Starbucks and Ernst and Young are a few companies whose employees have participated.

CSR boosts recruitment

A lot is being said about the role that CSR plays in recruitment and employee engagement, particularly among millennials who will make up 50% of the workforce in 2020Research conducted in The 2006 Cone Millennial Cause Study indicates that 79% of millennials want to work for a company that cares about how it impacts or contributes to society and 64% report that their company’s social and/or environmental activities make them feel loyal to their company.  

Are the publication of CSR reports and the active promotion of CSR initiatives in the recruitment process enough to induce employee loyalty and engagement?  In spite of the prevailing economic conditions, an on-line survey conducted by Right Management in 2010 revealed that 59% of HR professionals in North America believe turnover rates will increase in the next five years. 

Building a positive corporate image through the veneer of highly visible CSR programmes and reports doesn’t seem to be enough to sustain business success.  If corporations intend to attract, retain and engage their employees – particularly the socially minded millennials – more attention and action are required to ensure that the values they promote through CSR programmes are internalized and integrated in daily work.

This article was originally published in YourWorkplace magazine, Volume 15 Issue 1.

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