This year, mandatory governmental intervention will see companies earmarking over 2.5 per cent of their profits for social causes as part of corporate social responsibility (CSR). This will bring in more than Rs 10,000 crore for the social sector this financial year. It will, therefore, be a good idea for companies to partner non-profit organisations to identify the right causes to fund which will create a win-win situation for all. If a right partner is selected, the result can be added revenue, increased media exposure, positive public relations — or all three for both partners.
Why do companies go for CSR? They want to give back to the society is one reason for sure. The other reason is to build their brand and business while doing social work. Long-term benefits can only come from developing the society where they operate. The right cause marketing is the best PR for a company. Some companies take up CSR work, at least in India, with a clear drive to make business. This is somewhat flawed in that the benefits to top line or bottomline may not be apparent in the short term. Most Indian companies do not bother about it at all apart from a few donations here and there. They have not really understood the concept of cause marketing and CSR. Done right, it benefits them in the long term tremendously.
Instead of simply donating money from their CSR budgets, companies should identify the right causes to associate with where they have a natural affinity with the business. Such cause marketing is different from philanthropy in that the latter generally involves a specific donation, while cause marketing is more of a strategic marketing relationship decision. So, when selecting a cause, companies should check for strategic linkages. You cannot fund every good cause. Just as your strategy is to offer differentiated products or services, so should be your CSR initiatives.
Typically, companies search for organisations that have missions similar to theirs in order to fund causes. The lack of traffic sense and lane discipline can be improved in India tremendously and automobile brands should be jumping into driving this cause. Anything to drive quality of life is what most companies should look for. Some companies look at higher education when they hire so many college students. Wipro is a good example. Premji has funded a university to improve the quality of teachers who in turn may impart better education to many.
Once the cause and the partner are identified, companies should work towards building a strong partnership. Here are a few guidelines to build one:
l Give more than just money. Do not just allocate funds to the non-profit organisation and the cause. Involve as a true partner, attend joint meetings, conduct regular reviews on progress, put in place some measures, and make valuable suggestions to bring in more professional approach to managing the cause. Remember, not for profit partner may not have the kind of brainpower your organisation may have. But, it is also important not to impose your thinking onto the partner. It should be collaborative, in nature to nurture relationship and success of the cause. For instance the non-profit organisation, Medici Institute for Diversity and Innovation, works closely with a state government to co-create civic sense change in one city along with various other stakeholders. The keyword is “co-creation”. However, when a cause requires Rs 2 crore and if you have provided Rs 20,000 you cannot expect to influence the non-profit organisation to your way of thinking.
l Set clear objectives and expectations. Unless objectives and expectations are set, and all stakeholders are aligned, there will not be any trust and execution. It is best to set all these before inking the pact to partner. You make that expectation up front.
l Let your partner know of your business needs. Non-profit organisations should know that companies who donate from the CSR front are sincere about the cause and yet have a business need too. Unless this is met, the long-term sustenance of the cause marketing will be in doubt. Critically companies will want appropriate branding in all social programmes they undertake and this could be a sore issue sometimes. How much branding is a question that will always come up in discussions.
l Communications channels should be two-way. To build and sustain successful partnerships both the company and the agency that executes the cause should strive to keep open communication channels all the time. Substantial donors may get a board membership in the agency. Definitely companies should seek a steering committee membership.
l Be aware that non-profit agency and you speak different languages. If this is not understood there can be huge problems. For instance, many non-profits do not have solid systems to track progress and develop appropriate metrics. They are also publicity-shy. To them it is important to do the good work and do not understand how good public relations can help them build and expand their cause. Here is something businesses can do to help.
l Put metrics and reviews in place. Both partners should know if the mission is getting accomplished and whether progress is on track. Companies can set two types of metrics. One set is simply the way to measure the impact of the charity that it is supporting. The other set is about the level of awareness in the community. zz
(The writer is the CEO and MD of CustomerLab)