Five lessons from ten Corporate-Charity partnerships
From an article on Business Fights Poverty
At the charity CARE, Laurie Lee was involved in partnership schemes with ten of the UK’s largest FTSE100 companies. He reflects on all of those experiences and distils the key lessons for companies to have a positive impact on poverty and the environment, and how companies, charities and governments can work well together.
An example project was Banking on Change. This was a large, six-year partnership between Barclays, CARE and Plan, to reduce financial exclusion in several African countries and India. 750,000 people on income under £1 a day, including 300,000 young people, were supported to benefit from informal financial services through Village Savings and Loans Associations, saving $34M. 5,000 groups (125,000 people) were then linked to formal banking services in Barclays and other banks in six African countries and India. Over 100,000 micro business were sustained for at least six months. This demonstrated that Savings Groups were a nationally important and commercially viable route to financial inclusion. The Barclays Uganda CEO changed his customer growth strategy and the Tanzania government put Savings Groups at the heart of their financial inclusion policy.
Based on his experience, Laurie's five lessons are:
1. Charity partnerships can increase profits
If charity partnerships and ESG programmes pay for themselves and increase profits, why wouldn’t you do them? They may not always achieve it clearly but it is important to recognise that they sometimes are very good business. Sometimes the return on investment might be less obvious or take longer but it’s still there. If people can diversify their income, have better health and clean water for example, then they are more productive. Companies increasingly recognise that their positive social impact is vital to employee recruitment, retention and motivation, which in turn improves profits.
2. Low-income customers are valuable and numerous
The aim of any corporate-charity partnership should be to have a lasting impact beyond the duration of the initial investment. One of the main mechanisms for this is to adjust a company’s attitudes about whether the lowest income people are viable customers, employees and suppliers. Once achieved, this will lock a more inclusive approach into the company’s business model. Good for business growth and good for social inclusion.
3. Work with other companies, but only when it makes sense
There’s a well-known African proverb that says: ‘If you want to go fast, go alone. If you want to go far, go together’. A caricature of business would be that it’s sceptical of the benefits of slowing down to work with others, and therefore misses out on bigger prizes. But it is always important to have a good reason for working with other companies. Don’t do it for its own sake. If you want to transform a whole sector, or influence government policy, then it is a very good idea to work with other companies. Business is familiar with trade associations. Charities can help inform policy positions which trade associations, and therefore industries, adopt. But if you are just trying to achieve your own ESG goals, it may or may not help to worth with other companies.
4. The biggest impacts come from long-term partnerships
This may seem pretty obvious, but I think it needs saying. Almost all of the most successful partnerships I've seen have been built over several years, and the biggest impacts have tended to come from the longest partnerships. Credit to all of those companies for taking that long-term approach. This is not simply a matter of mathematics, that a 10-year programme will achieve x10 a one-year programme. A long-term programme might achieve less impact in its first year than a one-year project, because it is gearing up, engaging with communities, managers, employees, customers and governments. But it might achieve x100 the impact in the end. There can also be a role for short-term partnerships but as with all relationships, it’s the ones that last that matter most.
5. Multiply your impact on the whole sector, and government policy
Creating more inclusive approach business models is one of the ways for a corporate-charity partnership to have a lasting impact beyond the duration of the initial investment. Another way is for the partnership to change the way a whole sector, or government works. It is important in any strong corporate-charity partnership to think about how the programme can spread its impact and objectives beyond the direct project. This can increase both the scale and duration of its impact. This could be by promoting the benefits of the original project to industry groups, government and international agencies.
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From an article on Business Fights Poverty, 22/03/2023