Corporate social investment (CSI) has evolved significantly over the past 25 years. As we celebrate 25 years of The Trialogue Business in Society Handbook (previously The CSI Handbook), it is worth examining CSI’s transition through three distinct phases which we term CSI 1.0, CSI 2.0 and CSI 3.0.
From the early days of CSI, in which companies took the first steps to contribute to socioeconomic upliftment in South Africa, business has played an integral role in development. The increasing professionalisation of CSI has seen a transition from reactive grantmaking, where businesses made charitable donations to non profit organisations (NPOs), to the complexity of bringing about systemic change.
This article charts the evolution of CSI from pre-democracy South Africa, through political transition and economic transformation, to the ‘lost decade’ under former president Jacob Zuma, which presented developmental challenges, as economic growth achieved between 1994 and 2008 was reversed. Despite these challenges – or perhaps because of them – CSI continues to strive for transformational change in the country.
CSI plays no small role in helping to bring South Africa closer to the United Nations (UN) Sustainable Development Goals (SGDs) Agenda 2030, the African Union Agenda 2063, and the Southern African
Development Community’s Regional Indicative Strategic Development Plan, with which the National Development Plan (NDP) is aligned. Goals include the elimination of poverty, a reduction in inequality, and growing an inclusive economy.
CSI 1.0
- Grantmaking/once-off charitable donations approach
- A ‘welfare’ approach and the support of ‘worthy’ causes
- Mostly cash donations
- The CSI function housed
separately from business
operations - Reporting: images of projects and beneficiaries
CSI 2.0
- A shift from a welfarist to a developmental paradigm, in the context of the global sustainable development agenda
- Longer-term flagship projects
- Companies supporting programmes for three to five years
- Companies looking holistically at what impact is created by
interventions - Stronger alignment of initiatives with business goals and shared value
- Reporting: emphasis on outcomes, tracking and measuring
CSI 3.0
- More complex, taking the entire ecosystem into consideration
- Using financial models such as innovative finance and outcomesbased finance
- Funding advocacy as part of programmes
- Emphasis on knowledge-sharing and collaboration
- Increased use and application of data
From CSI 1.0 to CSI 3.0
CSI 1.0
South African companies played
a complex, yet important, role
in South Africa’s transition to
democracy. The establishment of the Urban Foundation in 1976 laid the groundwork for focused corporate giving during its 18 years, with more than 350 companies helping to raise funds for education and housing.
At the same time, companies that were deeply entrenched within the apartheid system had to rethink their stance, especially considering the global rise of corporate social responsibility (CSR), and the values of social, economic and political justice embedded in the Sullivan Principles, which guided the conduct of US companies operating worldwide.
These principles provided a framework for corporate giving and allowed South African companies to bring some formality to their corporate giving in the form of nascent CSI programmes. Companies like Anglo American, De Beers, Gencor, Gold Fields and Liberty formed charitable trusts and foundations to manage their donations.
The early years of CSI in South Africa saw the private sector increasing philanthropic giving, but it lacked the strategic intent that would become a feature of CSI 2.0. Giving was largely reactive and only incidentally part of a largely transformative effort. In his master’s thesis ‘Corporate social responsibility: evaluating three South African companies’ initiatives’, Neil Fourie called the early years of CSI “a feel-good charitable side-show”, in counterpoint to an industry that is now a strategic and integral part of transformation in the country.
CSI 2.0
The publication of the second
King Report on Corporate Governance for South Africa (King II) in 2002 brought into focus the fact that social responsibility and corporate citizenship could inform how companies thought about their business. This marked a shift in CSI, with companies choosing to fund projects that aligned with their values and strategies. In 2004, the BroadBased Black Economic Empowerment (BBBEE) Act was signed into law, with wide-ranging implications for companies, as CSI was included in the codes and charters. This meant set targets and expenditure requirements, turning CSI into a performance-driven pursuit for businesses wishing to improve their BBBEE scores.
CSI 2.0 was characterised by
greater investment in communities
as stakeholders, rather than just
beneficiaries. This was the era
of three- to five-year flagship
projects, with companies investing
in one or two sectors rather than
disbursing funds wherever need was identified. This sustained support, together with greater consultation with implementing partners and communities, proved fruitful – it facilitated long-term relationships and strong branding opportunities. Social investment became a focal area, and the ‘professionalisation’ of CSI began with the appointment of specialists and the introduction of
dedicated, formula-based CSI budgets.
With the establishment of a CSI industry, greater emphasis was placed on meeting regulatory requirements and achieving developmental impact in partnership with other stakeholders, most notably government and civil society. Grantmaking became far more strategic, moving away from
‘doing good’ to bringing about long-lasting change.
CSI 3.0
Research conducted by Trialogue
in 2021 shows that companies use
three primary sources to inform
their CSI strategies and practices:
company strategy (90% of survey
respondents), government policy
documents and development plans (77%), and global codes and standards like the UN Global Compact (UNGC), the UN SDGs, the Global Reporting Initiative (GRI), and others (72%). With a multitude of metrics against which to benchmark their CSI initiatives,
companies are acknowledging the
complexity of the development
landscape, along with the need to
partner with other stakeholders to
bring about meaningful change.
Companies and other stakeholders
are taking a more holistic approach to development, considering the entire ecosystem in which they operate. Increased collaboration and cross-sector engagement are taking place, driven by innovative and outcomes-based finance. In addition, companies are more willing to support legitimate and lawful advocacy work, particularly in a post-pandemic world of accelerating inequality and injustice.
A good example of CSI 3.0 is the Teacher Internship Collaboration South Africa (TICZA) initiative, the convening group of which consists of JET Education Services, the Bertha Centre at the University of Cape Town, BRIDGE Innovation in Learning, and Trialogue. The Global Teachers Institute (GTI) has played a key role in conceptualising the initiative. TICZA is supported by funding from Absa, the Maitri Trust, the Standard Bank Tutuwa
Community Foundation and the
Zenex Foundation. For more on TICZA, see page 214.
Read ‘Establishing a Foundation‘ to understand more.
Timeline
Sources:
- The Trialogue Business in Society Handbooks, 1998–2022.
- The Trialogue Business in Society Conference 2022.
- Idowu, S. and Filho, W., eds. (2009). Global Practices of Corporate Social Responsibility.
Source: The Trialogue Business in Society Handbook 2022 (25th edition)
