Finding ways to do things better

In the Philippines, paradoxically, the glaring economic and social divide, exacerbated by political instability, has pushed business leaders to redefine the boundaries of business’s relationship with society and has thus almost served as a bridge between business and community.

In recent years, the business community has made a significant shift from pure philanthropic involvement to a much more evolved form of corporate citizenship. This involves mainstreaming the social and environmental agenda in business operations and taking an active leadership role in discourse among the different sectors on social issues such as poverty, the environment and conflict. Business and community can be seen as working together for a common vision – not only helping the less privileged to help themselves but also helping each other as equal partners to create broad-based social gains.

During the recent CSR Week (7-11 July),[1] the League of Corporate Foundations presented President Gloria Arroyo with a consolidated report on the amount of social investment committed by the business sector for the year 2002-04,[2] amounting to over $51 million. Over half of this is accounted for by the commitments of PBSP[3] ($16 million; 31 per cent of the total) and Mirant Philippines ($17 million; 34 per cent). The remaining $18 million (30 per cent) comprises the social development commitments of 20 other corporate foundations and business groups.

As well as investing in society financially, businesses are also forging new relationships with communities through B2B (business-to-business) approaches such as mentoring and internship of SMEs to big multinationals.[4]

CSR practice assessed

In a CSR Week plenary presentation attended by over 250 NGO representatives, corporate and foundation executives and CEOs, PBSP presented its first Benchmarking Corporate Citizenship Practice report. This featured the results of a self-assessment survey participated in by 49 major companies in the Philippines, whereby company managers and foundation executives assessed the quality of the following elements of companies’ practice:

• the quality of leadership provided by CEOs to ensure consistency between social commitment and business practice;
• alignment of business policies and practice with the principles of corporate citizenship;
• strategic importance and responsiveness of CSR programmes to companies’ triple bottom line and community needs;
• effectiveness of internal systems and procedures to ensure sustainability of corporate involvement in development issues;
• the company’s ability to measure the results of its CSR programme and report them to both internal and external stakeholders.

On a scale of 1-5, leadership scored the highest (mean score 4.36, lowest 2) while measurement and reporting scored lowest (mean score 3.89, lowest again 2), which basically means it is underdeveloped.

Challenges and opportunities

Various pointers emerged from the report that will be relevant to companies that are trying to find ways to do things better. These include:

• Translate principles and commitment into concrete action. This is the greatest challenge for leaders.
• Build a culture of accountability and social vision. CEOs need to nurture a new breed of leaders with a clear social vision and a sense of accountability to society. Companies should support programmes that empower individuals and communities, especially minorities (women, children, indigenous peoples, Muslims).
• Clearly define the business case for doing CSR. This can be done by aligning CSR programmes with the business, social and environmental agenda. In turn, the social and environmental agenda need to be mainstreamed in all business processes.
• Involve everyone. Fulfilling the company’s social and environmental bottom lines is everyone’s concern. This means promoting employee engagement as a tool to harness intellectual capital, increase social investment and add value to the social market, and strengthening partnerships with all stakeholders to scale up impact, consolidate strengths and overcome challenges.
• ‘Show me the returns.’ CEOs will continue to insist that ‘returns’ are very important. Companies invest in society and in people because we want to see that apart from doing business we also foster public good.

1 This is a yearly advocacy campaign spearheaded by the League of Corporate Foundations.

2 The funds will have significant spill-over in terms of spending into 2004.

3 This consists of contributions made by PBSP members plus funds raised using membership monies as leverage. For instance, PBSP raised around $6 million from the Asian Development Bank because of the funds it was able to raise from its corporate members.

4 PBSP’s Business and Peace programme (in partnership with IBLF, British Chamber of Commerce and British Embassy Manila), for instance, deploys young Muslim managers from Mindanao as interns in the areas of human resource development, banking and finance to companies like Unilever and HSBC.

Elvie Grace A Ganchero is Manager of the Center for Corporate Citizenship of the Philippine Business for Social Progress, a collective of over 170 national and multinational corporations dedicated to strategically utilize business resources (time and monies) to invest in social development. She can be contacted at Bing@pbsp.org.ph

For more information
See www.pbsp.org.ph