CSI PROFESSIONALS BRIEFING 2014

Reana RossouwNext Generation Consultants

Session One: Trends and Forecasts 2014

Our Vision: Our Objective: Increasing Impact and

Enhancing Value We want to know how to

cultivate change more effectively in a world that sorely needs it

Our context Compare practice globally:

US, Europe, Far East Africa (continental) South Africa (regional)

Benchmark against findings of our Impact Investment Index

Tracking for the past ten years

Supported by 45 personal interviews with industry practitioners

What we know: CSI has become more strategic

but may need to become more than that - CATALYTIC

Too little progress has been made while the problems we face continue to grow

We believe that the work of the next ten years will have to build on existing efforts to include an additional focus on coordination and adaptation

Barriers to change Independence and control Insularity and inward focus Caution and risk aversion Time and inertia Competition and credit

The end result: A system with no natural

mechanism for coordinating effort, for learning, for sharing knowledge about what does and does not work, or for adapting to shifting changes

Isolated successes that are seldom replicated, new innovations that replaced old ones before they had time to prove themselves, with the unfortunate end result that funders and their beneficiaries are doomed to repeat the same mistakes again and again

1. A brave new world Bigger

Understand the context Pick the right tools Align independent action Activate networks Leverage other’s resources

Better Know what works (not) Keep pace with change Open up to new inputs/ideas Share by default Take smart risks

Evidence: Industry collaboration (National Collaboration Trust on Education); specific forums for specific focus areas (beyond painting class rooms and the OVC forum) – Western Cape Donor’s Forum)

2. Flipsides of the coin Government in crises Strains on safety nets Collapsing service delivery Weakened social support structures Sharpened eye on non profit

performance Rising funder/NGO tensions Continued legislative reforms Intense media and public scrutiny Forced collaborations and mergers Increasing social activism and

violence

Increased expenditure on CSI Increased public participation in

giving More innovation in

development approaches Changing funding models New localism Volunteerism rising and

increasing Increased communication on

givingEvidence: Increased income disparity vs. increased quality of life

3. Lean and Mean Impact of the recession:

Effective Efficient Strategic Less is more Less is less

Outcome of the recession:

Impersonal Hands-off Elusive Exclusive Abusive

Evidence: Website submissions only – no personal contact – no appointments – automated responses. More CSI brochures are being printed and distributed than ever before, sustainability reports on average has 4 pages dedicated to CSI SPENT! Without a single/person/number/contact/e-mail!

4. War on Ideas My flagship is

better/bigger/more expensive than yours

Fewer programs Bigger programs Higher profile programs More strategic programs More exclusive programs More internal programs

Evidence: Most flagship programs are single donor interventions – on average lasts for 2 years – closely linked to brands – with multimedia advertising support – no communication about impact – fly by night perception! Unilever – ‘saving life’s’ - not selling soap (Lifebuoy)Capitec – SWOP Mall – conscious consumerism – recycle, upcycle – on trend

5. The next big thing Capacity and leadership

development Operating support Enterprise development Job creation

Focus shift from social to socio economic development

Good news: Collaboration is evident

Bad news: NGO’s are being measured on HOW they spend money not the results they achieve

Evidence: Good News: Sponsoring NGO’s for industry events. Prepared to pay on average 10% operating support. Bad News: It costs on average R1m to create a single job or start a new enterprise.

6. Green (BLUE) is the new black Environmental programs Impact from operations Impact of climate change

Risk issues and impact issues Short term issues Future issues

Food security Water scarcity Income/job disparity –

waste/recycling

Evidence: BHP Billiton offsetting 60 tonnes of carbon through the Wildlands Trust: Question: Is carbon offsetting a social issue / operational issue / risk mitigating issue? Is building a clinic the result of negative environmental or health impact on communities (LTO) – risk mitigating strategy or CSI spend or infrastructure / local economic development?

7. Alphabet Soup BBBEE LTO GRI IIRC IPIECA ICMM ISO26000 KINGIII UNGC SLP SED PRI IFC OECD

Impact of governance and compliance:

More due diligence: Indicators to measure change Impact – anecdotal evidence Assurance – more paperwork Reporting – evaluation

requires pictures for reports New policies, codes of conduct

and strategies

Evidence: More reporting does not mean necessarily mean better reporting – Practitioners will have to come to grips with the impact of governance, legislation and reporting requirements AND have their work assured.

8. New Age Stuff Social and ethics committees Stakeholder engagement Community perception

surveys Human rights implications Social audits Baseline studies Risk and opportunity studies Impact studies Beneficiation

New reports - Board committees oversight New reporting lines - Corporate Affairs New titles – Community Relations

practitioners, community engagement practitioners, community liaison officers

New responsibilities – human rights audits in programs

New strategies – linking to and integrating with NDP, IDP, SLP

New focus areas – industry commitments New criteria – ethics policies, vendor

registration processes, sustainability credentials (water, energy, labour practices, ethics policies)

Evidence: Signatories to local and international guidelines and codes (ICMM and IPIECA) – global policies, local execution. Major impact for companies moving into Africa

9. Hindsight is perfect sight Spectacular failure Spectacular success Glimpses of brilliance

Theory of change Theory vs. practice Process vs. systems

Outsurance - Pointsmen Dial Direct – Pothole Brigade Healthcare workers -

Discovery Mama’s - Clover

Holistic development Cradle to grave development Lifecycle development Lifestage development

Evidence: Previously criticized (low profile) programs have become ‘unmissable’ solutions to social problems – Biggest success stories? Single focus area and program!

10. Dangerous half truths What's good for you may be

bad for them What's bad for them maybe

good for you

Poverty has many dimensions Poverty alleviation or

eradication

Development is hard work Development is complex Development is expensive Development is systemic and

systematic Development takes time

Evidence: Most programs have only short term and quantitative impact – sustainability remains an oxymoron – development requires more than 12 month single cycle/single donor interventions – pass rates is not necessarily an indication your program worked!

11. 1 to 100 in 10 seconds The numbers game Jobs Pass rates Books Classes Students Learners Teachers

Quantitative vs. qualitative impact

Negative vs. positive impact Intended vs. unintended

impact Short term impact vs. long

term impact

Evidence: Sustainability reports only focus on quantitative data – not aligned to reporting requirements – and no single report speaks about qualitative impact = actual change. No single integrated report is able to show the link between community relations and value creation

12. Dichotomies

Urgency for short term results and stamina for the long term

Holding on to autonomy and looking for opportunities to coordinate and collaborate

Insisting on rigor and taking risks despite uncertainties

Innovation and creativity Responsiveness and

responsibility Scalability and focus Replicability and results

Evidence: Results of CSI reputation surveys indicated that only 10 companies in the whole country is getting it right! No new corporates on the top 10 list for 10 years running!

13. Keeping up with the Jones’s Asset-based funding Seed funding For profit funding Social enterprises and social

entrepreneurs Market-based solutions Impact investment Collective funding Cause related funding

New words: Resilience Empowerment Capacitating

Old words: Sustainability – sustainable

development = no one knows what it means or how to do it or how to prove it

Evidence: Only one in 20 funders will consider new funding approaches over the next two years. Only one in 30 funders will consider changing their funding criteria within the next 2 years.

14. Volunteerism is cool Growth in volunteerism Everyone is a hero Everyone can make a

difference Everyone wants to make a

difference Employee engagement is the

latest and coolest new tool in the box

It starts with me It is all about me

Rewarding volunteerism

Evidence: One in three corporates now have some form of facilitated employee volunteer program – and one in five have a dedicated practitioner to volunteerism. One in two corporates reward volunteerism!

15. Please give that man a fish Give a man a fish… Give a man a rod… Educate a women and you ….

Cash is no longer king Education is no longer cool HIV is no longer an issue Babies are more sustainable than

old people Cost benefit analysis is the new

thing

Sustainability of fishing sources

Endangered fish on the red list Impact of climate change on

fishing industry Fishing licenses All the kings horses and all the

kings men could not save NEMO

Question: What happens after the fish is caught? Give a man a fish and feed him for a day; teach a man to fish and you feed him for a life time; show him how to use Google search and he can teach himself how to fish!

16. I know what you did last summer

Unlikely bedfellows NUMSA, EFF, AMCU Righttoknow Solidarity Benchmarks and Lonmin

Community activism is on the up

Community activism may affect you negatively

Community activism may destroy your legacy Burning down of schools and

libraries, clinics

Evidence: Funding of political parties, funding of political leaders, funding of trade unions, funding of advocacy groups – what you report, where you report, do you read your own company’s sustainability/integrated reports, when last did you scan the media for information about your company?

17. Local is lekker – Joe & Jane Soap

Urban vs. rural funding The new donor/philanthropist

= Joe Soap Local Hero’s (volunteers) (Not) In my back yard Giving without boarders

(Zimbabwe and diaspora) Crowdsourcing

Local food gardens / markets / produce

Local recycling Local products

Request from ordinary citizens (not a formal NGO) who are the new facilitators and fundraisers

Evidence: Communities are organizing themselves: But no-one remembers who gave them the hand up! Khayalitsha cookies, Mielies, Men at the Side of the Road, Shanduka, Changemakers, Santa’s boxes, Kylie Mycroft, Claire Reed

18. Status Quo is not an option Investment = Return Responsive = Proactive Needs focused = Outcomes

focused Transaction based =

Relationship based Organisational funding = Issue

funding Cash giving = Value chain

integration Management = Leadership

Most companies have some form of M&E

Only one in ten companies conduct some form of impact study

Less than half of companies record the number of beneficiaries

Less than 20% of companies do baseline studies

Evidence: Becoming more strategic does not necessarily mean you have increased impact. Poorest regions still gets the least funding, national programs does not mean national impact. Companies moving into Africa (30% of all corporates) – uses the same strategy, focus areas, process, methodology as in South Africa.

19. A horse, a horse, my kingdom for a horse

Shared value & shared risk Risk vs. impact Ethics, morals, values The elusive sustainability

point

Disaster relief vs. infrastructure

Minority vs. majority funding Gender based funding Old vs. young Jobs vs. food Books vs. labs Urban vs. rural Crime vs. rehabilitation Art vs. houses

Evidence: Strategies have not become diversified – but focus areas have. Strategic CSI needs to re-invent itself – it is not about MORE of the SAME. Neither is it about doing MORE with LESS. Look out for the new word – not STRATEGIC CSI – But CATALYTIC CSI

20. Two hills ahead

The pressure to measure What you know What you don’t know What you don’t know you

don’t know Are you sure you want to

know?

Doing what matters Doing what is right Doing it the right way Accountability Flexibility Authenticity Engaged

Question: Towards Best Practice – what will it take? WHO is getting it right – Nedbank Foundation, FirstRand Group (FNB, RMB, Wesbank & Firstrand Foundation)Evidence: Homegrown best practice: Global Awards – Transnet Phelophepa and BHP Billiton Treepreneur Project

Engage widely Research deeply Compare extensively Collaborate creatively Communicate honestly Innovate flexibly

Advice for the Future

Trap Number 1: Once we have figured out the business model and strategy, we don’t need to worry about it anymore!

Trap Number 2: Grow, baby, grow!

Trap Number 3: If it worked for them, it will work for us!

Align for Success - In figuring out the right roles and resource priorities, the biggest challenge for many community foundations is aligning values, strategic priorities, business model choices, and organizational culture.

Adapt to Thrive - Community practitioners will always be challenged to adapt to serve an ever-changing set of community and donor priorities, focusing on impact today and permanence as an enduring community resource.

Questions and Discussion What did we miss? Examples of your own

practice?

What will it take? What do we need to do?

Contact Reana Rossouw Next Generation Consultants - Specialists in Development E-mail: rrossouw@nextgeneration.co.za Web: www.nextgeneration.co.za

PLEASE NOTE: THIS PRESENTATION IS PART OF A LARGER BODY OF RESEARCH! THIS INFORMATION IS COPYWRITED AND THE INTELLECTUAL PROPERTY OF NEXT GENERATION CONSULTANTS.