Africa cannot afford to ignore CSR any longer

As a young indigenous African man in Uganda, walking into my first job for induction training in 2007, I pondered with excitement about my new career and status.

I envisioned myself working for the rest of my life in that larger than life environment. Little did I know that this mighty institution in the international banking space would be the avenue and preparation ground for me to discover my true passion and purpose in a completely different sector- community development.

It was that organization's vibrant corporate social responsibility (CSR) policy that required and supported all staff to identify and implement community initiatives dear to them. I knew from that day, that I had found my opportunity to contribute to my country by supporting as many disadvantaged people as possible, especially youths and women. For me, community engagement was not just a performance requirement but a passion and it bothered me that many colleagues at work shunned this opportunity considering it a waste of time. For close to 10 years, I was a community champion initiating and participating in close to 70 community projects ranging from; tree planting, sports for empowerment, financial literacy, fundraising events for children living with cancer, blood donation among others. I am proud to say I have participated in events that have saved hundreds of lives, empowered thousands of women and youths, and made a tangible contribution to save our environment. I was so proud to associate with my employer that I always found myself at the forefront of most staff welfare activities and organizing strategic sessions right from an early stage of my career. It is this respect for my employer that made me work overtime to deliver on my targets. Statistics today show that the younger generation of workers is more attracted to socially responsible and impactful organizations as opposed to bottom-line oriented organizations.

Today, I run a youth empowerment social enterprise helping thousands of youths become professional entrepreneurs and employees in their respective fields. We also help organizations run effective community engagements among targeted vulnerable groups. Therefore, I can personally testify to the positive ripple effect of a well understood and executed CSR policy on an organization and the community it operates in.

Corporate social responsibility (CSR) is becoming a growing concern among business enterprises in modern times especially in Europe, the Americas, and Asia. Africa is still lagging behind the very component she would benefit the most from. CSR in Africa is majorly characterized by seasonal philanthropy from a few multinationals- also lacking long term evaluation and outcome assessments. However, there is also a handful of organizations that are on the right track increasingly embedding CSR in their business strategies as opposed to dishing out handouts for branding purposes.

A good example is Stanbic Bank in Uganda, that started a business incubator program for Small and Medium Enterprises in 2018 as part of their enterprise development department and has gone on to grow it into a semi-autonomous organization with fewer restrictions from entering into partnerships with like-minded organizations across different sectors. According to the bank, 500 SME's have been part of this initiative with tangible results in the form of productivity and revenue gain for many of them. Many of these have found it reasonable to open or even deepen banking relations as gratitude for helping them grow their businesses, therefore, creating shared value. It is the understanding that despite SME's being the real driving force of major economies, many of them have a very short life span due to limited resources for growth and business development. What Stanbic bank of Uganda is doing is not only helping businesses grow but aiding job creation and livelihood for many of the employees in such organizations. This is a relevant and effective strategy not only for the bank but the country at large as we grapple with high levels of unemployment.

However, it is important to first clear the misconceptions around CSR by many business leaders and managers. CSR is not just about philanthropy and neither is it just another expense to the organization. CSR is the soul of every organization. It is the culture and attitude of an organization towards all her stakeholders across the value chain. It is how an organization perceives and treats her shareholders, customers, suppliers, regulators, employees and the communities they operate in. My favorite proponent of CSR, John Elkington in his triple bottom line theory states that corporate leaders tabulate bottom line results not only in economic terms but also in terms of company effects in the social realm, and concerning the environment.

The benefits of CSR to an organization are enormous ranging from risk management to employee retention, customer loyalty, and brand promotion among many others. But the benefits are even more to society and the environment if well organised.

In Uganda, this COVID-19 season has allowed us to witness the potential of CSR at the national level. According to a recent report published in the new vision of 29th June 2020, a total of 1,500 Ugandan firms and individuals managed to raise over UGX 50 billion (approximately USD13.5m) in kind and in cash to supplement government efforts against COVID-19. President Yoweri Museveni has always reiterated the role of businesses and individuals in overcoming a common enemy, which for Uganda in the past were oppressive regimes. It is the same spirit that led to political freedom that must be harnessed towards social and economic transformation.

But for us to achieve a vibrant CSR environment, we need a strong regulatory environment. Regulation is the first pillar of institutionalization. This can be effectively achieved through political will and a collaborative strategy between government and the private sector aimed at creating alignment among individual company CSR strategies, National development programs on realising the benefits of effective CSR. Certainly, compliant companies must be the first to be considered for public support benefits like tax rebates and exemptions or bailouts during hard times. India understood this opportunity so well up to the extent of creating a ministry for CSR with matching legislation of a compulsory 2% CSR spend law in 2014. Despite a few challenges in regional resource distribution due to the concentration of most industries in specific locations and reporting challenges, India has consistently exceeded its CSR targets leading to a more than 50% increase in social impact spending among multinational companies since 2014. In fact, some companies have voluntarily occasionally exceeded the mandatory 2%. African nations can borrow a leaf but this must be on the premise of the principles of fairness, accountability, and transparency. The ‘Harambee' and ‘Ubuntu' spirit can also be harnessed among businesses leading to the even greater socio-economic transformation of our motherland.

It is also worth noting the absence of this policy has allowed gross misconduct of businesses on the environment, tax compliance, employee welfare among others due to the competitive nature of businesses and their insatiable appetite for profits at any cost, even to the detriment of ordinary citizens. Previous market failures in the western world have been a true testament to unethical business conduct. Therefore it is critical for African governments and businesses to understand that the cost of inaction is tremendously higher than the cost of action. We must take the first bold steps now in order to nurture a responsible business community capable of effectively supplementing government efforts in achieving desired levels of national development.

If nations and organizations had a way to prove their patriotism, it would be through embracing corporate social responsibility.

The writer has a Master's Degree of Institutional Management and Leadership, B.A Economics