CSI a unique South African gift

IN GOOD COMPANY 2016 features BUSA CEO and former head of Anglo American South Africa, Khayisile Khanyile. Rightly so, for the type of CSI that started at De Beers in its second year, 1890, was perfected at Anglo American, then adopted across SA, and is now referenced across the globe.

South Africa’s variant of corporate social investment (CSI) is a deep-rooted and unique form of private sector involvement in broader community upliftment work. While there are obvious similarities with what businesses do globally to support social change (outside their normal business activities), the story here has evolved its own features, not always apparent to outsiders.

One of these is the longevity of this work that can be traced back to a grant-making trust set up by the Cape Colony’s Cape of Good Hope Bank in the late 1830s, ramping to corporate practice via Kimberley’s De Beers Consolidated Mines in 1890. Anglo American, founded in the Union of South Africa in 1917, adopted the practice of reporting on its broader charitable giving two years later in response to the worldwide Spanish ‘Flu, and the story of South Africa’s CSI was truly on its way when that corporation started its famous Chairman’s Fund in the 1950s.

This initiative was to give formal life to Anglo founder Sir Ernest Oppenheimer’s 1954 declaration that “the purpose of the company is to make profits for its shareholders, but to do so in a way that makes a real and lasting contribution to the countries and communities in which it operates”.

The way that Fund developed, and especially after it became a formalised corporate function with executive representation from 1974, would be decisive for how CSI is undertaken in South Africa today. Anglo’s contribution to community development work in South Africa last year topped R1 billion, but this is a company in decline. Perhaps its greatest gift will one day be seen in how it influenced others in the private sector.

Indeed, South Africa’s private sector structural make-up, design, and required skill-sets in CSI rests on lessons brought by the decades of dedicated CSI functions carried almost exclusively through the then Anglo American Corporation until that entity’s restructure in 1998. These home-grown SA wisdoms have flowed to CSI programmes in many other places around the world since then.

The “personality” of CSI in this country is also far more complex than we might assume, especially when compared to trends abroad where businesses are often urged into this sort of work based on arguments that it will benefit their bottom line.

In South Africa the idea that this is the only reason to undertake CSI seems almost preposterous given our realities. It would anyway be to miss some of the bigger drives to CSI here.

One is that this work is often initiated bottom-up, from communities and employees with which a company is involved, rather than through top-down support for business growth, national plans and the like. A lot of good giving through companies is simply organic in its origin.

Because of this, attempts to more closely “align” CSI with government programmes or between companies across the private sector sometimes come to naught as what is of importance to one company or community may be very different to another. So it can be that some of the basics of “restoring dignity” to people by supporting welfare programmes may be of more interest to one company, while giving local support to more ambitious elements of the National Development Plan might be the preference of another.

The nuances that come from social investments funded through business but coming from many different points in society are unlikely to feature greatly in “the literature” of academic researchers, but knowing and making allowances for them should allow for the exciting and surely more humane understanding of how South Africans come together in these types of nation building.

When we underplay these facets of CSI and look only for economic-financial-market-share advantage as its driver, or for crude statistical measures of CSI’s impact, we miss much. The “how and why” of CSI is all around us, and for a long time now.

– Paul Pereira

(Pereira is an advisor to the Muthobi Foundation’s Nation Builder initiative. This article first published in the Pretoria News, June 2016.)

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