By Alexa Brown
Corporate Social Investment (CSI) refers to finance provided by the private sector for social and environmental development and conservation in fulfilment of its responsibility to society. It is beyond the normal business activities of a company and is not intended to directly increase company profit.
CSI projects usually have a strong developmental approach and utilise company resources to benefit and uplift communities. Ideally, CSI provides benefits to both the recipient and the donor.
CSI enables beneficiaries (NGOs, CBOs, NPOs) to achieve their mission, simultaneously adding value to the benefactor by offsetting negative impacts that their business activities may have on society or the environment. It can also help the donor to present its products in a more ethical and values-driven context which will be attractive to some clients who want to be aligned with an ethically conscious company. It is thus a good potential alternative funding mechanism for not-for-profit organisations.
Corporate Social Investment Defined
“CSI refers to a company’s total non-commercial contribution to society, which is not part of employee benefits or commercial sponsorships. This includes all SED [socio-economic development] initiatives, as defined by the BEE Codes of Good Practice, and most of what constitutes an LED [local economic development] programme, as set out in the Social and Labour Plan.”
Trialogue: http://trialogue.co.za/csi-definition-and-regulation/
CSI is at the intersection of the development sector and the private sector. Private companies commit to ethical business that contributes to economic development as well as improved societal or environmental impacts. These contributions offset the negative externalities of using resources, land and labour to build personal profits*. Legal and regulatory pressure shapes businesses’ roles in society, giving companies a “corporate citizenship” that is more accountable and fair, as it functions within society. As a business case, CSI benefits the benefactor by ensuring a healthy triple bottom line: financial stability, positive social and environment impacts that improve business impact and value, thus attracting more clientele and business. Conversely, CSI benefits the society or environment that the CSI benefactor targets.
In South Africa, CSI is an important contributor to the development and upliftment of economic, social and environmental welfare. It contributes to achieving governmental aspirations and development goals in line with the national constitution and planning frameworks (for example, by improving basic education access), especially where there is a lack of governmental capacity and resources.
In this light, CSI is a valuable source of funding that is beneficial both to the funder and to non-profit organisations.
CSI sectors in South Africa
According to Trialogue, a South African CSI consultancy, there are 11 different sectors in South Africa that private corporations target for its CSI expenditure. Corporations will support a project or organisation that boosts their “corporate citizenship” in line with their priorities and products. For example, pharmaceutical companies will fund health-oriented organisations. As there are 15 200 registered non-profit organisations in South Africa, competition for limited resources is fierce and alignment of priorities and outcomes within a specific sector is very necessary to maximise the chances of receiving funding.
In South Africa ‘climate change CSI’ is not recognised as a sector or even sub-category within a sector (refer to table below). Climate Change is thus incorporated into other sectors in ways that tend to be obscure, despite the multi-pronged approach of most climate change and development initiatives and organisations. Finding a corporation that will support climate change initiatives will most likely be found supporting the Level 1 sectors primarily, sometimes the Level 2 sectors and least likely the Level 3 sectors.
Level 1 CSI sectors segregated into specific sub-categories
Building a CSI strategy
CSI is controlled by the private sector, and for this reason successful CSI fundraising strategies should speak corporate language and make a ‘business case’ that is likely to attract corporations. A ‘go get them’ strategy may well work to impress potential funders. Lastly, it is important to maintain the relationship with a CSI investor for on-going support and benefits.
1. Identify your targeted CSI partner
Researching the different CSI contributors and what their focus CSI sector is can help to refine the process of targeting specific companies.
As Climate Change and Development is not a primary category in terms of current CSI expenditure it would make sense to initially focus on companies that contribute to Level 1 CSI sectors, and thereafter to focus on sectors that align with your organisational activities, such as health or education.
Put yourself in the shoes of the business/ corporation and think about what results they may want to see from their CSI expenditure. Ask yourself:
a. Can you deliver want they might want?
b. Can you add value to their impact?
c. Can they add value to your impact?
2. Attracting corporates
Options for attracting corporates:
Attract your potential funder through creative means on social media channels. Invitations to events, workshops or conference that you are hosting are a good way of enabling a CSI funder to learn more about your organisation.
3. Go to them
Organise networking opportunities at conferences, forums or meetings. You must be prepared to sell your organisations impact in a short amount of time so a pamphlet/ brochure to leave behind is beneficial. Flattery by way of showing you’ve done your research can help to heighten attention and interest in the potential funder: make sure the initial step of researching and aligning priorities has been done adequately.
4. Long term partnerships
Longevity of a relationship between a CSI benefactor and beneficiary is suitable for all involved, given the high number of non-profit organisations. This relationship must be maintained by producing annual reports that prove the impact of the project. This is the information that a company will use to boost their “corporate citizenship”. Transparent and up-to-date monitoring and evaluation measures of the project funded by CSI will create trust and build confidence in the value of the investment.
Lastly, recognising your funder is important. Acknowledgement in media outputs, websites, shows or radio talks and at different events will be welcomed gladly by the CSI funder as this satisfies their need for CSI. An end of year or end of project event is a great way to express gratitude to a funder.
Useful links
Here are some useful links that can help you understand Corporate Social Investment at a more in-depth level.
| Tshikululu / | Provides access to funding calls, reports and news and CSI. | http://tshikululu.org.za |
| Trialogue | Provides access to statistics and the CSI landscape – this helps with scoping who to target. You can also profile your organisation and have it listed in the Trialogue Funders Handbook. | http://www.trialogueknowledgehub.co.za
http://trialogue.co.za/ |
| Finance and Accounting Services Sector Education and Training Authority (Seta). | Provides a handbook on Corporate Social Responisbility. | Fasset. (2012). Corporate social responsibility: Course handbook. Retrieved from http://www.fasset.org.za/downloads/CSR_Handbook_Review.pdf |
* Fasset. (2012). Corporate social responsibility: Course handbook.
Retrieved from http://www.fasset.org.za/downloads/CSR_Handbook_Review.pdf