Business meeting the challenge.

An Inspiris-produced background report for the international Business Forum's 11th Congress, held in Bonn last October, contained a number of corporate social responsibility (CSR) case studies from across Africa. Stephen Williams highlights five studies that demonstrate how varied and multilayered are the ways that various companies have applied the principles of CSR.

Brookside Dairy, Kenya

Brookside is a private company founded in 1993 following the deregulation of Kenya's dairy sector in the early 1990s. Based in Ruiru, about 20km from Nairobi, Brookside produces superior quality milk and has a 40% share of the Kenyan dairy market. Some 7% of the total 80,000 suppliers are commercial farmers, the remainder are small scale producers.

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The widespread lack of refrigeration facilities means that timely delivery is essential. Brookside employs an army of delivery personnel, including more than 1,000 'bicycle boys' in the Nairobi area alone. Its sales depots now stretch from Mombasa on the east coast to Kisumu on the shores of Lake Victoria in the West.

As demand outstrips supply Brookside plans to introduce both morning and evening milk collections, potentially doubling smallholder income. It also plans to increase the number of collection centres.

Brookside-sponsored training field days are attended by up to 6,000 local farmers at a time, helping to spread best-practice in livestock management and provide networking opportunities for smallholders, many of whom are geographically isolated. The expanding business provides linkages between rural and urban economies and a sustainable route out of poverty for many. The CSR element of this business model provides additional benefits to local communities through health education programmes and funding for schools and road building projects.

Anglo-American plc, South Africa 

There has been a general trend for most corporations to move away from philanthropy and apply CSR principles, but understanding and influencing the impacts of core business operations in terms of CSR is far more complex than simply signing a cheque. As a response, Anglo-American's Socio-Economic Assessment Toolbox (SEAT) has been developed to enable any of the company's divisions to analyse its activities.

SEAT clearly demonstrates how vital it is that the whole ethos of CSR is imbued throughout a company's operations. Launched in October 2003, Anglo-American completed its first SEAT study in November the following year. Since then, of more than 50 studies complete or ongoing, over

a third have been conducted in Africa and that has enabled Anglo-American to be more responsive, measured and consistent in its CSR performance.

Using a series of 22 practical tools, SEAT does this by equipping managers with a framework to understand the totality of their economic and social impacts. It helps these local managers take a strategic view of interactions with communities in areas such as local employment, reducing the exclusion of disadvantaged groups, training, procurement, and social investment. It then guides managers to understand the dynamics of a community and engage appropriately with local people.

Unilever, Ghana

Launched in Ghana, the 'Novella Africa' initiative seeks to extract oil from the Allanblackia tree on a commercial scale--in a way that benefits the local population. This tree grows in the wet tropical forests of sub-Saharan Africa, producing pineapple-sized fruits, with many seeds rich in oil with unique properties that can be used to produce food products and soap.

Local communities already use the oil but, until now, it has never been used on a commercial scale. The overall aim of the project was to contribute to the sustainable development and trade of a new forest-based commodity that can help economic development by diversifying income sources, improving livelihoods of poor rural communities and fostering sustainable tropical forest management.

Harrie Hendrickx of Unilever R & D explains what makes this CSR programme so special: "Normally, we want to be at the end, not the beginning, of the supply chain; but here was a very good potential for a new raw material which would be of value to us and other manufacturers. To get it into a supply chain, someone had to step up to the mark to make things happen. Unilever played that catalytic role. It was an opportunity to launch things so that our African partners could develop it into a real opportunity for the continent."

By working in partnership, the quality and reliability of the supply chain can be secured. Apart from the core-team, more than 40 NGOs, small African businesses and government organisations support the initiative as partners in different African countries as a result of the work conducted in Ghana.

Mozal, Mozambique

BHP Billiton was the lead investor in the Mozal aluminium smelter in Mozambique, integrating it into the full social, institutional and economic transformation of Mozambique. Mozambique's biggest industrial investment, it was also one of Africa's largest direct investments (see African Business November 2000).

As a result of the investment, some 740 permanent jobs were created. Vocational training means that 93% of the smelter's permanent staff is now Mozambican--and the number of indirect jobs created by the project is expected to reach 2,500. Over 5,500 Mozambicans were trained in construction skills whilst the smelter was being built.

With job creation and poverty relief as primary CSR goals, Mozal created the Mozal Community Development Trust (MCDT) from the outset to link the smelter with its local community and provide projects to improve the quality of life of surrounding communities. Two hundred projects have been initiated so far, with expenditure exceeding $10m. However, the real development potential and benefits of the MCDT's CSR programmes lay not in spending on social projects but in small business development and the business it offered local suppliers.

The lessons from this flagship example of CSR in action within a major industrial enterprise is that developing a business skills training programme for local traders is vital to help SMEs compete successfully for work and then execute contracts.

This commitment to ensure the sustain-ability of the host community has delivered significant achievements, economically and socially for both the local community and the company concerned--a core objective for any CSR programme. From a position where almost all procurement was sourced from South Africa, local procurement is slowly shifting the balance from a level of $2m to now $9m.

The Big Four Banks, South Africa

Africa has the world's lowest savings rate, with little capital for banks to lend to grow a productive enterprise. But a concerted effort by a group of South Africa's leading banks is now providing access to financial services for a growing number of South Africans, regardless of the remoteness of their location, through the development of the Mzansi card, the Sekulula card and various other satellite technologies for accessing payment systems in rural locations.

Sekulula means 'it's easier'. In South Africa, the distribution of pension, disability and child benefits payments is a major undertaking towards the goal of eradicating extreme poverty and hunger. Switching from a cash-based to an easier electronic payment system offers savings, safety and access to basic banking services for thousands of South Africans, making it far more attractive for recipients to keep their money on deposit in a conventional bank accounts.

South Africa's 'big four' retail banks: The Standard banking group; Absa, part of the Barclays group; First National; and Nedbank--as well as Postbank, the South African post office bank--launched this low-cost facility aimed at those individuals entering the formal banking sector for the first time.

What this particular CSR programme demonstrates is how public-private partnerships can find innovative solutions to complex social problems, and how competitors in a particular sector can cooperate effectively in CSR projects whilst retaining their commercial independence.

RELATED ARTICLE: Corporate Social Responsibility Quotes

"It is the absence of broad-based business activity, not its presence
that condemns much of humanity to suffering. Indeed, what is utopian is
the notion that poverty can be overcome without the active engagement of
business."
Kofi Annan (right), former UN Secretary-General

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"How can business help? Well, by far the greatest contribution business
can make to development is through the very act of running its
business."
Graham Mackay, CEO, SABMiller plc

"The message from business ... [is] ... clear: Encouraging the
entrepreneurial spirit of Africa's people is central to growth and
poverty reduction. This means getting the investment climate right,
particularly for small businesses."
William Kalema
Chair, Uganda
Investment Authority

"It's fine for you guys to argue about increasing aid and wiping debts
out--that will not develop Africa. That will only help ease the pain.
What will develop Africa is investment, creating jobs, creating wealth.
What we need is more business in Africa."
Mohamed Ibrahim
Chairman, Celtel International

"I knew that whatever I learned would be much more useful in Uganda than
in economies that were more developed."
Andrew Rugasira
Chairman, Rwenzori Coffee Company