With Corporate Social Responsibility (CSR) being made mandatory in the form of Section 135 of the Companies Act 2013, corporates have now begun to recognise CSR as a core activity, and are looking to find innovative ways to effectively utilise their CSR fund. This has brought to the fore the role that NGOs and other implementing agencies can jointly play along with corporates in order to achieve what is known as collective impact.
Firstly, the importance of collective impact has been made clear in the legislation itself, which calls for and encourages companies to utilise the expertise of non-profits with a credible work record of three years or more. An NGO’s interventions can be spread to geographies that a corporate has its presence in, while also being complemented by the corporate’s wherewithal, and as such the impact of the programme can be more widespread, as was seen with the association between Social Venture Partners (SVP) and Hand-in-Hand. Apart from providing funding to Hand-in-Hand’s fight against child labour, SVP’s IT expertise has helped in the establishment of a robust management information system (MIS) for the NGO’s operations.
Further, the legislation also allows the companies to collaborate with other corporates in joint initiatives that can achieve greater impact with more capital. One such collaboration that led to very effective outcomes is that of Bharti Airtel, Star Global Resources and IFFCO Kisan Sanchar Limited (IKSL) where they empowered the farmers by providing them information and services such as free voice messages and a dedicated helpline to interact with experts through a robust communication network. About 13 lakh active farmers under IKSL are benefitting from this initiative.
Another good example is the association between Save the Children (a non-profit organisation) and global health care giant GlaxoSmithKline that are collaborating in an innovative initiative to transform an antiseptic (used in mouthwash) into a life-saving product for new-born babies. They have also come out with the powder form of an antibiotic that combats pneumonia, further demonstrating the value of mission-focussed cross-sector collaborations in addressing and resolving needs.(Full article:The future is bright for corporate-NGO partnerships despite challenges)
As seen, collaborations and associations make for an effective business case with respect to achieving maximum impact for a given CSR capital investment. While there can be apprehensions and concerns raised on the ease of tracking data and progress amidst collaborations, the reporting requirements have ensured that the process is transparent with corporates having to disclose their funds spent in each collaboration.
NGOs on their part have never been better positioned than now to be the consumers of a large quantum of capital. The premise of companies wanting to associate with them in their efforts not only fuels their cause directly but also increases the visibility of their work, thus building trust and credibility for them.
In order to facilitate a conducive scenario for companies to associate with NGOs in their CSR initiatives, a comprehensive database enlisting all NGOs (that a corporate could choose from) and the work done by them could be a helpful tool. The Indian Institute of Corporate Affairs (IICA) is planning a series of activities and initiatives such as developing a national NGO hub, and setting up a collaborative projects CSR portal.
In a Google Hangout organised by NextGen, after the Bill was passed, Sachin Pilot, Minister for Corporate Affairs addressed the panel comprising corporate heads and NGO leaders, strongly advocating the need for collaborative projects and a comprehensive database.
“There are companies who don’t know where to put the money or do not have the knowledge or information and there are NGOs, Non-Profits who are doing good work in those areas. We are trying to fill a database where you can put such people in touch with each other (sic)”
Further, he pointed out that there are about 600 districts in India and there are always projects that are short of funds.
“A company is making floor tiles or furniture, another company is making hardware electronics or TV screens and another company has an HR firm. And if they all put together [their resources] they can create a good vocational training centre, skill building centre for girls and boys and young adults and that has much more value than just donating money to put tyres or paint a building.”
While implementation of Section 135 is still in its nascent stages with companies trying to get a hang of what needs to be done and how, collaborative projects may take a few years to come up and yield results. However, in the long run, in order to solve India’s long term and large scale issues, it would be necessary for the industry to work towards collective impact which can make use of expertise and capacity required to achieve the desired outcomes.
- (By Prerana Manvi and Abhinav Prakash)