With input costs rising and a depressed economy, many businesses are struggling to make ends meet, let alone embark on ambitious Corporate Social Investment (CSI) initiatives. Yet, calls for help from the private sector are rising. How can companies continue to help?
According to the 24th edition of the annual Trialogue Business in Society Handbook, South Africa’s CSI investment amounted to R10.3 billion in 2021, a 4% decrease from 2020 and a real drop of 7%. Over half of the companies surveyed reported declined CSI spend due to lesser profits for the first time.
However, as this survey reflects the CSI expenditure of just listed South African companies, multinationals, and state-owned enterprises, both the actual CSI spend – and the decline – could be higher.
Denzil Steyn, managing director of Intellisec and president of the Durban chapter of the peer-to-peer Entrepreneur’s Organisation (EO), believes there’s still room for businesses to make a difference – they just have to work smarter.
“The call is to every South African business to contribute in some way, regardless of what our government is or is not doing,” he says.
He adds that the recent KZN crises highlighted this. “We have seen the value and power of unity over a common goal or vision in South Africa. Communities have rallied together to fix roads, bridges and help out those in need after the riots and flooding in KZN. These were extreme cases but, without this support, many would be without hope.”
EO member and CEO of IT solutions company NETCONFIG, Iain Emerson, believes that all businesses with means should be actively involved in making a difference. But there are challenges.
He notes that the primary one is finding legitimate CSI initiatives that align with a company’s values and purpose.
“The majority of the time, we select projects with registered NPO’s where we can obtain a Section 18A certificate. Where this is not possible, we have budget set aside to get involved where we can. As a technology services company, we also help by uplifting them and creating more efficient NPO’s through the correct IT solutions,” he explains.
Grant Gavin, owner of RE/MAX Panache believes that private sector generosity requires a balance.
“A business has to be at the right stage of growth before jumping into CSI initiatives. A successful business is better placed to support its community. An unsuccessful business cannot. Therefore, a business must be moved from that initial survival phase where income has yet to match expenses, and even through the stability phase where income matches expenses. Giving back to the community comes after success has been established. You cannot support a community if your business is not making a profit. Furthermore, getting involved in CSI initiatives is not a marketing cost, it’s an ability to give back from the proceeds of the business so that you begin to leave a sustainable legacy over the longer term,” he says.
Cindy Norcott, head of the recruitment business, Pro Talent, and founder of the Robin Hood Foundation, agrees that it is not easy for smaller businesses to embark on CSI. “Many business owners are busy and stretched and, even though they might have positive intentions, they don’t know what to do. It is also easy to get overwhelmed with the amount of need.”
She believes that charity should also start at home. “That means that, first, you need to ensure your own house is in order. Are you paying your staff properly? Are you treating them well? Do they have any needs that you could help them with?”
According to Norcott, the best way for a little to go a long way is for businesses to work together. “Sometimes small random efforts can be ineffective. I believe that, if like-minded entrepreneurs get together, get their staff involved and target one issue where they can make a significant impact, that will be a lot better than a shot-gun approach.”
Gavin takes this a step further: “Collaborations are powerful, especially when smaller CSI budgets can be combined with the varied skills and expertise of different businesses. That way, all can add value.”
For Emerson, it is about having sufficient foresight to see how the combined efforts of various smaller businesses can solve a combination of different challenges in communities or organizations. “It is the simple power of scale that can make a real impact,” he says.
He adds that businesses should focus on CSI initiatives that fit with their core services. “For example, we have sunken costs on salaries and can assist with time around implementing technology or providing technology training. We also look to our suppliers and partners to unlock services that are specifically available to Non-Profit organizations. This includes Microsoft solutions. This eases the burden of the capital requirement needed to invest in CSI initiatives.”
Norcott adds: “Making a difference doesn’t necessarily have to be expensive. A company might have a staff member who has some free time to help a charity or a soup kitchen. A company might have leftover products, an old computer, second-hand furniture or they might start a drive to collect a specific item and then use their network to get their clients and suppliers to donate to the cause.”
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