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Leah Auld

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Corporate investment in social performance is disengaged: this proposal suggests a means to engage firms to create real value for society

Large mining companies such as Rio Tinto, BHP Billiton and Vale are spending hundreds of millions of dollars each year on social performance initiatives. Although this is evidence of an increasing interest in social performance, the current initiatives are often criticised for being disengaged, focusing on monetary inputs instead of the value of outcomes.

This issue could be addressed in the context of a professional services firm, capitalising on existing tools and capabilities to facilitate their client’s management of social projects to optimise the value of their investment.

The firm would be engaged for the lifecycle of the project. Initially hosting a ‘kick off’ event, bringing together representatives from clients, NGOs, research institutes and community groups to brainstorm valuable problems and to define desired outcomes and boundary conditions of each group.

Once valuable projects are identified and agreed upon, the firm would act as a ‘behind the scenes’ facilitator. Customising existing strategic project management tools to focus on social performance outcomes would enable the firm to provide clients with valuable guidance on the progress of their social investment. The technological and reporting capabilities of a professional services firm would be a powerful tool, clearly articulating the outcomes of the social investments (both societal and the resultant improved financial performance).

Topics: CSR community investment social investment social performance
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  • Hubertus von Fircks

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    May 7 2012: I think this is a great idea. At the moment most of the companies only care about short term PR effects when investing in social projects, therefore they just throw money at random projects to receive positive feedback in the media and try to offset negative feedback they got before (e.g. environmental issues). Through this it could be ensured that long term sustainable value is added to communities and companies could actually convince the public that they have good intention to help the community.
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    R H 20+

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    May 5 2012: If you could demonstrate that by adding another layer of administration you could reduce financial waste and have more efficient disbursement of effort, then it could work. This would have to be an extremely ethical layer as they could be open to political influences and bribery for their clout position. There could be difficulty, possibly resentment, from the 'reps of the kick-off event' for no longer having access to the benefactors. But again, if efficiencies and increased 'mission results' could be demonstrated, it's a very plausible idea - if the 'mission' is truly what the benefactors are after. This is very interesting to me. I'm studying NFP mgmt.

    • Leah Auld

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      May 7 2012: Thank you for your feedback.
      In regards to the 'reps of the kick off event' no longer having access to the benefactors (by benefactors I assume you mean the community groups the projects are aimed at helping? Please correct me if I am wrong!), the proposal is not for the professional services firm to take responsibility for delivering the projects on the client's behalf, more to help them establish the right connections and provide guidance along the way to ensure real results are achieved through social investment. In this sense, the corporate clients are ultimately responsible for delivery of the project and will be at the forefront in terms of putting plans into action, but the professional services firm is working behind the scenes, providing the tools, capabilities and access to networks to ensure the projects are achieving societal outcomes.

      I'm sure, with your NFP mgmt background, you are familiar with the rise in attempts from corporates to collaborate with NGOs, research institutes etc to enhance social performance. From the research I have undertaken it appears these efforts are quite disengaged (throwing money at the cause rather than becoming genuinely involved). From an NFP perspective, do you think an offering as proposed above would appeal to NFP organisations as a means to increase the value of their collaboration with corporates?
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        R H 20+

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        May 7 2012: Thanks Leah for responding to my comment. By benefactors I meant the corp sponsors. In my experience (which is very limited regarding NFP's. My background is mostly on the corp side, but i'm in the process of transitioning), often those who received 'organized' benefits want to give (and get) direct input and don't like dealing with an intermediary. They can feel 'removed' and 'excluded' from the process. It's more of a 'status' thing than anything. They will certainly take the money... I would absolutely think that NFP orgs would open to anyone who could administrate more efficiently for greater delivery of services - unless they already have well-established administration themselves. NFP's, gererally speaking, are not interested in admin. They want to be effective and make a difference. This is the basis of my interest in NFP's. Just think how much greater efficiency of service delivery you could accomplish if you could demonstrate to the gov't the effectiveness of such an intermediary?
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