Successful global companies are involving all employees from senior management down to shape their community investment strategies


Successful global companies are involving all employees from senior management down to shape their community investment strategies

A key strategic question for community investment in any company is how this activity should be structured and managed. This is particularly relevant in multinational companies, where different business environments and social contexts create challenges.

Companies can structure their community investment in one of two ways. They can let the focus for community investment come from employees on the ground or from the top of the company, either globally or locally. While companies covered by the research in this report tend to emphasise one of these approaches, none relies on one exclusively; rather, they employ a mixture of approaches.

A number of the companies surveyed set the direction of their community investment centrally. This provides a structure for programmes throughout the different countries of a business’s operation.

Business relevant

At IBM, community investment comprises a small number of large scale global programmes applying the company’s technology skills to social needs that are relevant to the business, such as education, healthcare research and environmental management. The approach reflects a strong belief that IBM can have more of an impact through large-scale activity than smaller scale initiatives developed and run at a country level. Celia Moore, IBM’s corporate citizenship and corporate affairs executive, says: “Programmes can be adapted to the local environment as they are implemented. Small one-off grants are unlikely to be strategic and deliver long-term change”.

Microsoft and Procter & Gamble illustrate how clear strategic priorities at a global level can be implemented at a local level in very different ways, reflecting the needs of individual markets.

Microsoft has over the past five years sharpened the focus of community investment towards information and communication technology skills. The primary focus of all community investment has, since 2003, been on supporting underserved communities to access technology and skills training through a programme called Unlimited Potential. The aim is to promote social and economic opportunity for people yet to experience the benefits of technology. Groups served range from the disabled to refugees, but the objective is consistent across all groups and markets.

Sylvie Laffarge, Microsoft community affairs director for Europe, the Middle East and Africa, says: “Broad parameters and big goals are set out, but then the actual programme design and much of the decision-making comes from the field. ‘Quite decentralised’ is how I’d characterise our structure and implementation. This allows adaptation appropriate to local economic and social development agendas.”

P&G directs community investment through its Live, Learn and Thrive global framework, which offers a range of programmes based on hygiene, education and life skills for children in need. Countries have the flexibility to run their own programmes based on this platform, or to support global programmes. For example, the successful Pampers partnership with Unicef, providing tetanus vaccines to women and babies in the developing world, began as a Latin America programme that has since expanded to many other countries.

This balanced approach gives a company a strong central message about the purpose of its community investment while allowing individual countries to shape their activity in the most appropriate way.

Country-level strategies

Some companies devolve decision-making to a country level. At BP, the individual businesses make strategic social investments in line with local priorities and conditions. BP corporate responsibility director Sheldon Daniel says: “We operate in such a diverse set of places, we’ve realised that our businesses need to have flexibility to respond to local level needs in the way they conduct their community investment.” Major areas of involvement usually include education, enterprise development and governance.

Vodafone delivers community investment through 23 country foundations. Each foundation is given free range to determine its own strategic focus, an approach that is appropriate for a company that has grown through acquisition and where different markets have different priorities.

Vodafone in the UK has chosen to focus on the market it knows best: young people. Vodafone has a wealth of knowledge around marketing to young people. It therefore makes sense for the company to focus on the challenges faced by this group. It is currently funding a programme called Life Choices that will combine on-the-ground and online services to help young people make decisions about their future.

By contrast, in Spain the foundation focuses on funding research into the societal benefits of new technology.

Centrally driven strategies allow organisations to make deliberate choices about the focus of their community investment. Increasingly companies align the content of their programmes closely to their core business activities. This allows them to play to their core competencies as a business, and bring expertise as well as cash to bear on an issue.

Microsoft sees emerging markets as vital for its future growth. Its community investment is therefore focused on ensuring that technology reaches everyone in ways that serve their economic and social well-being. The company’s goal is to bring the benefits of technology to the next one billion people worldwide in underserved communities by 2015.

IBM wants to link its community investment work to its focus on innovation. Its global community programmes involve partnering both internally with its research division and externally with other partners. For example the World Community Grid programme harnesses IBM expertise, working with research institutes in areas such as cancer, HIV/Aids and muscular dystrophy therapies, and in climate modelling.

The Royal Bank of Scotland ties its community investment into its core business by focusing on financial inclusion and financial capability. “In terms of a choice it’s bang aligned with what we do as a consumer finance company,” says Stephen Moir, head of community investment. RBS’s long-standing Money Sense programme provides resources for lessons in schools on managing money and the School Bank scheme gives young people experience of having a bank account.

Employee-driven strategies

In other companies, the direction for community investment is determined largely by employees. This approach ensures that employee involvement will be substantial and enthusiastic since it reflects employees’ passions.

The focus of community investment at Google is not determined by any single team or department, but by every employee. Google’s European director of communications D-J Collins explains: “I can’t give you an interview with the head of community investment because they don’t exist.” Employees’ individual passions and interests are all candidates for investment by the company.

This strategy rests on a belief that the most important thing a company can do is to allow employees to innovate and experiment. This closely reflects the philosophy of Google as an organisation. All “Googlers” are encouraged to spend 20% of their working time on projects of their own choosing. As a model it relies on highly motivated, socially-interested employees, and Google’s recruitment process is specifically designed to select such people.

This policy has enabled Google employees to get involved in a range of disparate activity, from using online mapping tool Google Earth to campaign against the construction of a dam in California, to working with Beatbullying in the UK using video-sharing website YouTube to reach young people. The company has also developed the RechargeIT initiative, via, that aims to increase the use of plug-in rechargeable vehicles through a programme of research into energy consumption of cars in Google’s fleet, including regular models, hybrids and plug-ins.

At RBS, although community investment is centrally directed, there is a strong commitment to enabling employees to get involved in whichever causes interest them the most. “We firmly believe that our staff are better placed to identify local causes in the places where we operate,” Moir says. Employees can invest time in local causes of their choosing and apply for Community Cashback awards – grants donated to the charities they are involved with – in recognition of their work. This combination of supporting employee interests while addressing core business issues through community investment is being rolled out across the new parts of the business acquired through last year’s acquisition of ABN Amro.

Whatever the scale of a company’s community investment activity, creating the right structure is crucial. As these examples demonstrate, this means finding a structure that fits with the company’s business model, culture and values.

IBM: a global approach for a global business

Heritage - Founded in 1911, IBM has a history of giving cash and technology. Its community investment developed in the early 1990s with the launch of more formal, global programmes aligned with the business strategy.
Community investment structure - Core offering of about 15 global programmes, implemented by operating countries according to local context.
- On Demand Community Grants is the employee scheme that donates cash or technology to causes for which employees volunteer.
Issues of focus - Central commitment to using ICT to transform education. Also employment, arts and culture, environment and communities in need.
Scale of community investment spend - $166m in cash, equipment and services in 2007.
Employee volunteering - Global volunteering scheme, On Demand Community, is a website that helps employees take their skills and to support their local community.
- The Corporate Service Corps, launched in 2007, offers small teams of employees the chance to volunteer in an emerging market for one month, learning leadership skills at the local level.
Leading activity IBM’s approach to community investment is characterised by global IT programmes. Raising student achievement in schools is a major focus through programmes for early learning, science and engineering, language and literacy, and change management. These are all supported by volunteering.

Google: freedom and innovation in community investment

Heritage - Founded 10 years ago with a strong mission of enabling people through access to information. The separate entity was formed in 2004.
Community investment structure - No formal structure for community investment or corporate responsibility.
- For-profit makes social investments and encompasses the grant-making Google Foundation.
- Extensive ad hoc activity is generated by individual staff and supported by the company on a case-by-case basis.
Issues of focus - No specified issue focus. Most activity uses Google’s products and competencies for societal good, eg using Google Earth to expose illegal logging in the Amazon.
Scale of community investment spend - $85m in grants and investments made by since it was founded in 2004. Ad hoc contributions not measured.
Employee volunteering - No formalised policies, but many volunteer and Google is flexible about allowing them time to pursue those interests
Leading activity is a “hybrid philanthropy” for-profit organisation that gives grants and makes investments in a range of projects related to the use of technology in addressing global challenges. Its purpose is to provide seed investment and leverage Google’s technology expertise. Diverse initiatives include RE

Moving away from corporate foundations

Corporate foundations have traditionally been seen as a good way of ring-fencing funds for community investment. They can also help give continuity of purpose to a company’s giving, and lend themselves to longer-term partnerships with charities.

While Vodafone is a clear exception, companies surveyed for this study are moving away from structuring community investment through foundations. RBS took the decision to close the operations of ABN’s foundation because it was not seen as aligned with RBS’s more integrated approach.

Where foundations do exist, they are often just a means of channelling funds rather than a delivery tool for community investment. At BP, for example, the company uses its foundation, in part, to support responses to humanitarian aid in the event of natural disasters and other events, particularly in locations close to where it operates.

Increasingly, foundations are seen to be more appropriate as a philanthropic rather than community investment tool because they involve a formal separation from the business.

Investment  SRI 

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