About five (5) years ago, CSRFilesTM Digest was premiered as CSRFilesTM Weekly in partnership with the Guardian, to provide practitioners, stakeholders and the general public with a resource and reference point on issues of Business Ethics, Corporate Social Responsibility (CSR), Sustainability, Corporate Governance and Social innovation, within the African business environment.
In cheerleading for a proper industry, a code of conduct and perhaps a peculiar standard to aspire to as African enterprises, different topics ranging from Integrated Reporting, Corporate Governance, Inclusive Business, Sustainable Business Growth, Sustainable Development Goals Series, Industrialisation, Financial Inclusion, ICT/Education for Development, Supply Chain Risks, and Designing your Social Investments, to the Collapse of Globalisation, Infrastructure and Sustainable Development, Environmental Sustainability, Improving Healthcare Systems, and Bridging the Inequality Gap, have been featured.
In commemoration of the 300th edition, we have compiled and developed all editions (from inception), into a compendium of five series. Below is a sneak peek into the series:
Executive Series: Business and Industry: This series features business/industry-related articles such as: Corporate Governance, Social Investments, Inclusive Business, Sustainable Business Practices, Financial Inclusion, Stakeholder Engagement, Industry and Sustainability.
Inclusive business: Multiplying impact through investment
People make business investments for many reasons but, it is unarguable that every entrepreneur sets up businesses primarily to meet consumer needs – make impact on the community and ultimately, to make revenue – make impact on the entrepreneur. The concept of impact in business relates to both tangible and intangible effects your business actions have on your shareholders, employees, customers, as well as the society at large. Although impact has always been a major focus of businesses, the current economic climate further nudges the necessity of making impact, to the survival of any business.
Inclusive Strategies for Impact & Prosperity
Providing what the market wants: An effective strategy to operate an impactful inclusive business is by tailoring products and services to meet the exact needs of large markets. An inclusive business develops products and services that improve the well-being of all consumers, especially the poor and vulnerable. Furthermore, a business that practices inclusion is not just mindful of profit but also of value for all consumers, not despising any member of the society. These translate into increased market efficiencies, cost savings, revenue growth and improved profitability.
Adjusting prices to consider all levels: A company can practice inclusive business by offering products and services at prices that consider all levels, including the low income members of the society. A business that considers all pocket levels in setting prices is able to serve more members of the society; thus increasing its customer base, impact, and subsequently its revenue.
Providing inclusive employment: This is one of the most common models of inclusive business. A business can integrate inclusion into its ecosystem by creating opportunities for training and bringing local skills/marginalised but highly innovative neglected members of the society into its workforce, not only to alleviate poverty, create employment or contribute to development but also to bring diversity, innovation, and better productivity into business.
Investing in empowering small businesses towards growth: Most businesses that have benefitted from practicing inclusion imbibe this model to bring about ‘shared prosperity’ – both for them and the empowered as well as development to the society while alleviating poverty. Including the low and vulnerable in business activities is training, empowering, and investing in them in order to impact their lives, make them useful to the business and contribute to solving some of societal challenges. A business that trains, empowers, and/or invests in a local tech-developer could be opening opportunities for accessing new and useful technologies that could grow its business. A beverage business that supplies seeds to and invests in local farmers could be creating an opportunity for locally sourced but affordable raw materials for its beverage production. Moreover, as the G20 Development Working Group puts it in the G20 Inclusive Business Framework 2015, people living at the base of economic pyramid when included/integrated in a business become part of the value chain of the company’s core business as suppliers, distributors, retailers, or customers, which in turn benefit the company’s output.
CSR and Sustainability Series: The articles in this series focus on specific strategies to sustainable development, how corporate sustainability levels businesses, sustainability trends, as well as designing, communicating and reporting Corporate Social Responsibility (CSR)/Sustainability.
CSR Development in Nigeria: A critical review of trends and challenges
It has been observed that despite several Corporate Social Responsibility (CSR) investments in Nigeria, impacts are scarcely seen across sectors.
Below are recommendations on how CSR investments can be an effective tool for improving the various sectors of the economy.
Improved strategies: Take education as an example, CSR investments in education contribute to the standard of education in Nigeria. However, a company may actually not be strategically investing in education if it only supports students without also investing in the administration of schools, infrastructure, principals and teachers, as well as other important aspects of education. Investments in education should transcend beyond support for primary, colleges and tertiary institutions only, other forms of institutions must be impacted for investments in education to be all round. For instance, education for prisoners’ children is paramount whilst CSR support to low cost private schools and institutions of special needs/vulnerable children is also an important aspect of educational investment. It is however not sufficient to dole out social initiatives without tracking. Impact measurement is an important aspect of CSR therefore; it is expedient for every CSR professional to have a strong knowledge of available impact measurement tools.
Internal Approach: It is important that CEO’s are committed to integrating CSR within their businesses, however, CSR must be strategically driven and not CEO-driven. It should come from strategic thinking that aligns with company’s focus so the company is able to innovate. CSR professionals should show better understanding of CSR; intelligently motivating and convincing CEOs and senior management on strategic social ideas. It is thus expedient that every CSR professional is on top of their games in order to facilitate effective CSR in their various organisations. It is however imperative to measure impact at all times because there is no CSR action with no measurable impact. Measuring impact is a strong aspect of any CSR initiative, which determines overall success or no success at all and there are several measurement standards available for every form/level of CSR initiatives.
Periodic Evaluation: What doesn’t get planned doesn’t get done. CSR must be thought of strategically as there may not be a reason to continue with CSR if there are no visible impact on an organisation’s revenue. Although giving back may be good, it has to be strategic. It is important to have a corporate strategy and a defined policy to engage CSR. More so, a connection of CSR with core business focus is a first step towards an effective CSR. It is possible that the financial impacts of CSR are not seen in the short run but they are always visible in the long run if judiciously performed. There is however a need for education by CSR professionals, to both the public and private sectors, as well as to the general public, especially on issues of CSR as philanthropy versus as a business strategy.
Leverage: CSR is also a means of making money, gaining market recognition and increasing return on investments; unfortunately, many organisations do not see how to make money from CSR. Brand owners have to engage in CSR and in turn sustainability, for market penetration and to increase Return on Investment (ROI). To make CSR interventions sustainable, companies need to identify their areas of strength before engaging in any project. For instance, before a company undertakes to build a school, it should consider its capacity to recruit or pay teachers’ salaries. It is not sustainable to buy expensive things for a school without a follow up to ensure that such intervention delivers the purpose for which it was meant. CSR professionals must collaborate and partner to move CSR forward in Nigeria.
Editor’s Note: In the next edition, we would feature key articles from the last three (3) books of the Compendium: Sustainable Development Goals (SDGs), Gender and Environment, and Sectors: Agriculture, Education, and Health.
*Article written by ThistlePraxis Consulting