Last year, 25 civil society organizations in the municipality of Guarulhos in Brazil took part in a training programme in institution building and the management of community-based organizations. The programme was led by executives of major corporations and funded by those corporations.
The Guarulhos programme is the expression of a new attitude towards corporate citizenship in Brazil. It is also part of a planned effort by community leaders to create a new kind of organization: a community philanthropy organization (CPO), through which corporations are progressively becoming part of their communities, and partners in community life.
The CPO is a revised version of the traditional community foundation. A key difference is that it is not itself a grantmaker. The Guarulhos CPO, called Viva Guarulhos, does not gather or distribute funds but acts as a broker and catalyst for all parties in the community that have funds or influence or other resources. It involves more than 100 local organizations and some 45 companies. They are committed to raising key human development indicators in their municipality of 1.2 million people.
The CPO itself is funded through an annual fee from the participant companies, which pays for salaries, basic office needs, publications, etc. When projects and resources to implement them are identified, the CPO acts as a broker, directing funds directly to the organization that will be responsible for implementing each project. The CPO also follows each project, looking for results and evidence of impact that can be used to assure donors that their money is making a difference to the community and to help attract new donors for new projects.
The model is flexible enough to accommodate local needs and circumstances. Each donor retains the responsibility for the quality of their giving, but on the understanding that it is the community that identifies needs, and that monitors the results and impact.
This last point is crucial. The CPO model establishes a new paradigm for companies. Rather than a company branding a social investment scheme, developing a template, and applying it wherever it can, it has to be willing to have the priorities determined by the communities in which it works.
How it began: the DOAR programme
A research project which the Institute for the Development of Social Investment (IDIS) began in 1999 found that community philanthropy often lacks a commitment to change the status quo of people in need; it is a philanthropy without strategic vision, based on the emotion of givers rather than their reason, with no professional understanding and little concern for governance. In order to change this, IDIS established the DOAR programme to foster the institutional development of community philanthropy in Brazil through local CPOs.
A basic principle guides the programme: local philanthropy should operate under an organized Local System on Social Investment. The first step is to identify community-based organizations and other non-profits, volunteer organizations, donors, human services linked with churches, local companies and public agencies. Once the different players are identified, the main task is to make the giving resources that are available more effective, and the instrument for doing this is the CPO.
Like a community foundation, the CPO provides a link between the financial resources that exist within a community and the charitable needs of that community, but without the creation of a permanent fund for grantmaking.
At first it was difficult to involve business leaders, but as they began to see the potential for becoming involved in communities, and to see the results of resources they invested, they became natural leaders.
The DOAR programme’s six successful pilot projects show that the CPO model is adaptable and sustainable. It is also replicable. While the pilot projects were grant funded, now that the model has been developed, any company can sponsor/lead development of a CPO in any community. In fact IDIS is now employed by four large corporations to give technical support to 37 new CPOs.
IDIS’s role in developing new CPOs
In general, when a company comes to IDIS for assistance, the following steps are taken:
Step 1 A company approaches IDIS and decides that it wants to support, for example, youth.
Step 2 A dialogue is held with local authorities, NGOs community organizations in which IDIS proposes the company’s interest in youth issues. Sometimes the community is not interested, a possibility acknowledged between IDIS and the company.
Step 3 The company works with the community to develop priorities. Each participant says what assets they have to address community problems.
Step 4 IDIS works with the community and the company to get a CPO organized in order to translate the priorities into a working plan. Community leaders lead the new CPO. This may include someone from the company that is sponsoring the initiative, but not necessarily. Other local companies are invited to became associate members of the new community-based organization, which is a separate legal entity with its own board and staff and volunteers.
Step 5 IDIS helps the community to address such questions as how to go about the work proposed, team-building, the creation of partnerships and social networks, and fundraising. Resources other than those available or provided by the company that sponsors the initiative will be sought through a planned fundraising effort involving other companies, wealthy families and individuals, and the general public.
In short, IDIS provides provides assistance to each participant community to develop and implement its own strategic plan to develop philanthropic activities.
The preparatory phase
In the pilot projects, this phase lasted a year. It allowed for the identification and selection of community leaders by the community itself to participate in leadership training. The selection criteria used guarantee a balance of experience, motivation, gender, race and age. The leadership training is designed to enable participants to identify communities’ assets, better recognize the opportunities for development in their own communities, and become familiar with existing knowledge and recognized best practices in community philanthropy. The second element of the preparatory phase is the design and development of a community plan to organize local philanthropy and private social investment.
The implementation phase
The length of the implementation phase varies according to conditions in each community. On average, it was around two years in the pilot projects and included the following activities: technical assistance to implement the community’s proposals; field visits to support and facilitate local processes initiated by CPOs; networking opportunities, such as workshops, travel tours and seminars for participants to share lessons learned and to address selected topics of common interest; and institution-building, especially in the area of fundraising to support the new organization.
The IDIS community philanthropy programme has introduced the idea of CPOs as a means of organizing local philanthropy in a way that is more appropriate to the Brazilian situation than a community foundation. Endowment building is difficult in Brazil because of the legal framework and because, traditionally, donors want to keep funds under their own control.
For their part, companies have found a strategic niche for contributing effectively to community development. It also creates a better climate for their business. Trust and stewardship come together when there is transparency in decisions and when concrete results benefit the local community.
The CPO idea also creates a more sustainable model for community initiatives and organizations. Private resources are better used and new donors are encouraged to participate. As local communities become better prepared to participate in addressing key social problems, the capacity and effectiveness of existing organizations increases and the creation of new ones is facilitated. In addition, the impact of private resources, and the education of local communities to monitor and evaluate their impact, have made for better control over public expenditure.
Replication and its limits
Though there are no potential limits to how far the CPO model can extend, there is a practical limit that needs to be addressed. Replicability depends both on available funds and on technical expertise. Though companies that want to become involved in their communities are now paying the development costs themselves, at the moment only IDIS is supplying technical assistance and there is a limit to how many CPOs it can support. If CPOs are to spread more widely, a larger pool of trained people will be needed, which will involve injections of time, expertise and money. This is a challenge which will have to be met if the CPO model is to reach its full potential. This may require a further round of grant funding or it may be that companies, seeing the value of the model, will be prepared to fund this next stage of development.
1 This article is based on IDIS’s work through the DOAR programme.
2 The Guarulhos CPO is one of six pilot projects running under IDIS’s DOAR programme, which brings together groups of companies, civil society organizations and local authorities.
Marcos Kisil is President of the Institute for the Development of Social Investment (IDIS), São Paulo, Brasil. He can be contacted at firstname.lastname@example.org