In my view, one of the clear differentiators between the way Africa sees governance, and the way that the USA looks at it, is that in Africa there is far more focus applied to the positive impact that a company can have on a broad range of stakeholders, whereas in the USA the focus tends to be on what shareholders want.
Interestingly, following Prof Mervyn King’s lead with the King Codes (currently on King IV™), global governance standards are consolidating to a common principles-based standard that includes a much broader spread of stakeholders and has been codified into the ISO37000:2021 (Governance of Organisations) standard.
Internationally-celebrated Nelson Mandela Day is a great representation of the powerful, positive impact that we can have as companies and individuals on those less fortunate than ourselves, even if it is only for 67 minutes of one day per year! Not too much to ask.
The theme for 2024 is “It is still in our hands to combat poverty and inequality” and those who celebrate this year’s event are encouraged to use #ItsInYourHands while sharing their events and efforts on social media.
At board level, though, great value can be unlocked from a profitability and social impact perspective if we think about Corporate Social Investment (CSI) much more often than for a small part of one day each year. It should be part of our overall strategy.
Various governments around the world have incentives that reward – or rules that compel – companies to invest in CSI activities through the provision of cash, services, products, staff time and more. Many companies and individuals of course also contribute of their own free will – often “behind the scenes” without making a song and dance of it.
In many cases though, involvement and support become a “tick-box” exercise and are only discussed occasionally at board level.
My request is that all companies start to think of CSI more in terms of the total impact that a company can have on its broad range of stakeholders as part of the overall strategy linked to the company’s vision, mission and values. For example, include an agenda item at your annual strategy meeting that asks: “What impact can we have on all of our stakeholders to improve the lives of those most in need?” Considerations include:
- Employees: Does the business have a policy that accelerates wage increases for the lowest paid employees up to a level where they can afford basic necessities more easily? For example, everyone receives a minimum annual increase of say R1,000 per month. This is a big increase for someone earning R5,000 per month (the same as an intern earns), but much less than a CPI-based increase for someone earning R30,000 per month.
- Suppliers: Is there a way that the company can better support the smallest of your suppliers to grow and employ more people, thus impacting the community in which they operate and providing more much-needed jobs?
- Clients: Supporting clients to grow means that there might be an opportunity to minimise price increases, or offer bigger discounts, on products that serve low-income customers. It could even be an education initiative to support low-income clients to make better health choices without costing more.
- Community: Is there a shelter, soup kitchen, sports development initiative, or charity that the business could support in the local community? Could employees be organised to help with regular projects, or charity fundraising efforts?
- Environment: Many low-income areas struggle with garbage collection and pollution. Does the business have the skills to help with clean-up operations? Could you organise your team to help with a beach clean-up, or with litter collection in a nearby common area?
- Shareholders: Is there an opportunity for the lowest paid employees to benefit from an employee shareholder trust, or some other profit or company value linked bonus programme?
“It is still in our hands to combat poverty and inequality.” What can you do on Nelson Mandela Day and every day to make a difference?
