What makes for meaningful corporate social initiatives?The experiences of two corporate foundations in the Philippines

Raymund B. HabaradasDe La Salle University

5th International Conference on Corporate Social Responsibility, October 4-6, 2012, Berlin, Germany

BayanihanA spirit of communal unity or effort to achieve a particular objective. From the Filipino word bayan, which refers to a nation, country, town or community.

‘Bringing the house to a new place’

Similar concepts in other countriesGotong-royong (Indonesia / Malaysia)Dugnad(Norway)Barn raising(Rural North America)Talkoot(Finland)

Where is ‘our house’ now?Poverty in the PhilippinesIn 2006, there were 27.61 million poor Filipinos (32% of the population)45% lived on less than $2.00 / day; 22.6%, on less than $1.25 / dayAbout 4.0 million households (or 21.2% of families) experienced involuntary hunger at least once in the past three months

(Sources: NSCB, 2010; World Bank, 2008; and SWS, 2010)

“So massive and pervasive is poverty in our country that our response to it cannot be small.”

- Tony Meloto, Gawad Kalinga founder; recipient of the 2006 Magsaysay Award for Community Leadership; recognized as ‘Social Entrepreneur of the Year, Philippines’ by the Schwab Foundation in 2010

Big business must help

“With poverty as a major social pressure point, government capacity to deliver social equity is stretched, and business is called upon to ‘take up the slack’” (Roman, 2007)

Corporate social initiativesDirect involvement of corporations in community projects, and provision of significant resources to these projects beyond cash donations (Alperson, 1996, 1998; Hess et. al., 2002)

Corporate social initiative Meaningful social initiative An initiative that is sustainable and

has the potential for a significant positive impact on society (Hess & Warren, 2008)

Symbolic social initiative Initiatives that are meant to stave

off stakeholder pressures without necessarily providing much benefit to society (Hess & Warren, 2008)

Research questions How do selected Philippine companies

utilize corporate social initiatives to create value for both business and society?

How do corporate and environmental contexts affect the adoption and implementation of these initiatives?

What makes for meaningful corporate social initiatives?

Environmental context•Competitive context•External stakeholder pressures•Social expectations

Corporate context•Corporate mission•Corporate strategy•Corporate culture•Corporate leadership•Internal stakeholder pressures

Corporate social initiative•Adoption•Program design•Planning and implementation•Monitoring and evaluation•Approaches in handling problems•Outcomes

Case study research Corporate brochures, corporate

newsletters, annual reports, corporate web sites, and published materials in newspapers and magazines

Interviews with 34 individuals, including program managers, partners, and beneficiaries

Case study database: interview transcriptions, detailed interview summaries, field notes, printed materials, online materials

Data presentation and analysis Case descriptions of six CSIs of two corporate

foundations Use of both qualitative and quantitative data Validation of propositions derived from:

Corporate social performance (Wood, 1991) Resource-based perspective (Branco & Rodrigues,

2006) Stakeholder approach (Jamali, 2008) Strategic philanthropy (Porter & Kramer, 2002) Meaningful social initiatives (Hess & Warren, 2008)

Ayala Corporation Founded in 1834 One of the oldest and

largest business groups in the Philippines

Engaged in real estate, telecoms, banking and financial services, water distribution, electronics manufacturing services, automotive dealership, and BPOs

Shell Philippines

Started operations in 1914 Involved in oil and gas

exploration, production, oil refining, distribution, sales, and customer service

Operates a 100-thousand barrels-per-day refinery, 22 oil distribution terminals / depots across the Philippines, and close to 1,000 retail stations nationwide

Corporate foundations

Pilipinas Shell Foundation, Inc. (PSFI)

Established in 1982 Mission: Enable the

disadvantaged “to become productive and responsible members of society”

Ayala Foundation, Inc. (AFI) Established in 1961 Mission: Contribute to social

development through community assistance, educational programs, employee development, or business innovations that cater to the poor and other marginalized groups.

Six corporate social initiatives Gas Mo Bukas Ko (GMBK) (Your Fuel is My Future)

Sanayan sa Kakayahang Agrikultural (SAKA) (Agricultural Skills Training for the Youth)

Bawas Basura sa Barangay (Triple B) (Reduce Waste in the Community)

Kilusan Ligtas Malaria (KLM) (Movement Against Malaria)

Gearing Up Internet Literacy and Access for Students (GILAS)

text2teach

Gas Mo Bukas Ko I and II Provides a better future for Shell station

staff through short training courses that enhance their employability

Courses include automotive mechanics, refrigeration and air conditioning repair, welding, basic computer course, and bookkeeping

Implemented in partnership with TESDA and other accredited training centers

Actively supported by Shell dealers Now includes dependents of transport

workers and of Shell contractors 1,010 beneficiaries as of 2011

Top: Shell retailers Desi and Candy Tomacruz with GMBK scholar Jayson Duran; Left: Richard Bueno is now station manager; Right: Alex Geronimo is now a forecourt supervisor.

SAKA and Shell Training Farms Aimed “to persuade young people to

stay in the countryside, till lands, and help revitalize the rural economies”

Open to out-of-school youth, particularly sons and daughters of farming families

Supported by Shell Training Farms (STFs) and the Integrated Farming Bio-Systems (IFBS)

First implemented in partnership with agricultural schools in farming communities

SAKA and Shell Training Farms SAKA scholars learn not

only to grow crops but also to sell their produce

Scholars are now engaged in agricultural entrepreneurship – processing their harvests to create added value

983 SAKA beneficiaries and 13,917 STF / IFBS beneficiaries as of 2011

Bawas Basura sa Barangay Initiated by Shell Pandacan

Installation One of PSFI’s programs under

the Pandacan Expanded Assistance for Community Empowerment (PEACE)

Goal: to build the capacity of barangays surrounding the Pandacan installation to establish and manage their own waste management system

Triple B’s triple benefitsEconomic benefitsEmployment for 15 project workersIncome for eco-aides or biomenIncome for barangay

Environmental benefitsReduced volume of waste collected by City of ManilaCleaner barangay surroundings

Social benefitsGreater awareness of residents on the importance of waste segregationActive involvement of barangay and its officials in project implementationImproved compliance with R.A. 9003 and City Ordinance 7876

Kilusan Ligtas Malaria / MAM Goal: To eradicate malaria in Palawan

and other provinces in the country Community-based malaria control

project implemented in partnership with municipal and provincial health offices and LGUs

Malaria cases in Palawan decreased from 42,394 in 2,000 to only 5,623 in 2011. Deaths due to malaria also went down from 67 to only 3 over the same period.

MAM Finance Officer Randi Andrino, PSFI Program Manager Marvi Rebueno-Trudeau, and Sulo IPHO Ema Carpiso inspect bednets shipments in Zamboanga City.

Kilusan Ligtas Malaria / MAM

Distribution of long-lasting insectiside-treated nets (LLIN); blood smearing

Kilusan Ligtas Malaria / MAM Because of KLM’s huge success, PSFI

secured a five-year grant from Global Fund to Fight Aids, Tuberculosis and Malaria (GFATM)

In 2003, KLM was renamed Movement Against Malaria, which covered four other provinces

Malaria cases dropped by 88% over a six-year period in the 5 provinces.

In 2010, PSFI received $31.4 million from GFATM, which allowed it to expand MAM’s coverage to 40 provinces

GILAS Goal: To boost the quality of education

in the Philippines by connecting all public high schools to the Internet

Provided schools with: An Internet laboratory with 10 to 20 PCs Provision of server, printer and network

peripherals Local area network Free Internet use for one year Training for teachers and school heads Monitoring and technical support for one

year

Total number of students who gained access to the Internet as of 31 October 2011: 4,399,500

GILAS

text2teach Goal: To improve the quality of

teaching in Grades 5 and 6 in public elementary schools by providing highly interactive, easy-to-use multimedia packages

Teachers can select from almost 400 educational AV materials on Math, Science, and English.

Materials are downloaded using 3G-enabled high memory capacity mobile phones with an application called Nokia Education Delivery (NED).

text2teach - phone teacher

text2teach

Nokia private sector funder and technology developer

Globe TelecomSole provider of telecom infrastructure for downloading of content and free use of lines for help deskDepEd

Curriculum-based objectives of the program

SEAMEO InnotechTeachers training

AFIPartners and resource mobilization, area and schools identification and validation, technical support, and overall project management

CSI Social problems addressed

GMBK • Unemployment of out-of-school youth• Limited social mobility of unskilled workers

SAKA • Unemployment• Low productivity of agricultural lands• Out-of-school youth

Triple B • Garbage problem in urban communities• Unemployment

KLM / MAM • Malaria incidence and deaths• Limited budget for health programs

GILAS • Low quality of education• Limited exposure of students and teachers to ICT

text2teach • Low quality of education• Limited access to high-quality instructional materials

Social problems addressed by CSIs

CSI Social Value Business value

KLM / MAM • Significant decrease in malaria morbidity and mortality

• Enhancement of skills of barangay health workers

• Awareness of communities on ways to prevent malaria

• Goodwill of community• Enhanced relationship with

business partners• Stronger links with rural-

based NGOs• Social legitimization• Enhanced corporate

reputation

text2teach • Access to high quality audio-visual materials

• Enhanced understanding of lessons by students

• Significantly higher scores of students in Math, Science, and English exams

• Goodwill of community• Enhanced relationship with

business partners• Extensive networking with

LGUs & local DepEd offices• Brand loyalty• Enhanced corporate

reputation

Cross-case summary – social value & business value

The CSI skyline

‘Bayanihan’ philanthropy

Addresses pressing social needs

Driven by corporate values and leadership

Adopts a relational approach

Shaped by learning and innovation

Exhibits managerial accountability

Characteristics of meaningful CSIs

‘Bringing the house to a new (and better) place’

Addresses pressing social needs

CSI addresses pressing social needs SD D U SO MA SA UA Our corporate social initiative addresses a pressing

social need (e.g. poverty, unemployment, homelessness, health).

1 2 3 4 5 6 7

Our corporate social initiative has significantly improved the lives of its beneficiaries.

1 2 3 4 5 6 7

There has been a significant increase in the number of beneficiaries since the corporate social initiative began.

1 2 3 4 5 6 7

Our corporate social initiative can be easily replicated in other communities / settings.

1 2 3 4 5 6 7

Our corporate social initiative can be easily scaled up to benefit more people.

1 2 3 4 5 6 7

Driven by corporate values

CSI is driven by corporate values and leadership SD D U SO MA SA UA Our corporate social initiative enables the

company to fulfill its mission.1 2 3 4 5 6 7

Our corporate social initiative is aligned with the core values of the company.

1 2 3 4 5 6 7

People (program staff or employee volunteers) responsible for the implementation of the corporate social initiative understand the core values of the company.

1 2 3 4 5 6 7

Corporate leaders commit adequate financial resources and logistical support for our corporate social initiative.

1 2 3 4 5 6 7

Corporate leaders use their credibility and influence to generate additional support for our corporate social initiative

1 2 3 4 5 6 7

Adopts a relational approach

CSI adopts a relational approach SD D U SO MA SA UA The inputs of community members / beneficiaries

are considered in the design of the corporate social initiative.

1 2 3 4 5 6 7

Community members / beneficiaries are actively involved in the implementation of the corporate social initiative.

1 2 3 4 5 6 7

Other groups / institutions are actively engaged in the implementation of the corporate social initiative.

1 2 3 4 5 6 7

Our corporate social initiative generates funding and other types of support from other groups / institutions for the corporate social initiative.

1 2 3 4 5 6 7

Community members / beneficiaries, as well as other groups / institutions, provide suggestions on how to improve the implementation of the corporate social initiative.

1 2 3 4 5 6 7

Shaped by learning and innovation

CSI is shaped by learning and innovation SD D U SO MA SA UA Program staff or employee volunteers responsible

for the implementation of the corporate social initiative have become increasingly adept in fulfilling their tasks.

1 2 3 4 5 6 7

Program staff or employee volunteers constantly find ways to overcome resource constraints.

1 2 3 4 5 6 7

Difficulties in implementing the corporate social initiative have given rise to innovative approaches or solutions.

1 2 3 4 5 6 7

Program staff or employee volunteers have improved the implementation of the corporate social initiative by learning from past mistakes.

1 2 3 4 5 6 7

Best practices are documented and communicated so that these can be easily replicated.

1 2 3 4 5 6 7

Exhibits managerial accountability

CSI exhibits managerial accountability SD D U SO MA SA UA Our corporate social intiative is executed well,

resulting in the achievement of goals and targets.1 2 3 4 5 6 7

Funds are strictly utilized for the purpose they are meant to be spent, and are clearly accounted for.

1 2 3 4 5 6 7

Organizational policies and standard operating procedures are followed in the implementation of the corporate social initiative.

1 2 3 4 5 6 7

Progress of the corporate social initiative is regularly monitored so that corrective action can be done whenever needed.

1 2 3 4 5 6 7

Regular reports are prepared to update key stakeholders (e.g. Board, funding agency, institutional partners, donors) about the progress of the corporate social initiative.

1 2 3 4 5 6 7

Web of CSI meaningfulness

Bar chart of CSI meaningfulness

Do more case studies on CSIs of Philippine firms, including SMEs Examine how companies address the tensions inherent in trying

to reconcile economic and social goals.

Look deeply into the philanthropic approaches of Philippine firms within and across industries Determine whether these firms predominantly follow the

transactional approach or the relational approach to philanthropy. See whether companies follow a trajectory in their philanthropic approach over time.

Recommendations for further research

Focus on CSIs that follow the relational approach Examine the dynamics inherent in collaborative undertakings

such as those of GILAS, Text2Teach, and MAM. What contributes to the success of these collaborations or what causes them to fail?

Examine CSIs that involve private-public partnerships, especially those that involve LGUs How do companies engage local officials, and how do they deal

with the problems of corruption and partisan politics, among others?

Recommendations for further research

“He who wishes to secure the good of others has already secured his own.”- Confucius

What makes for meaningful corporate social initiatives?The experiences of two corporate foundations in the Philippines

Raymund B. HabaradasDe La Salle University

5th International Conference on Corporate Social Responsibility, October 4-6, 2012, Berlin, Germany