By Stephanie Robertson
Founder & CEO of SiMPACT Strategy Group, Facilitator of LBG Canada
Until the early 1990s, charitable giving and philanthropy pretty much described how we all thought about the role of business in society. Then came community investment, sustainability, corporate citizenship, corporate (social) responsibility and shared valued. We are now in the age of purpose, the UN Sustainable Development Goals and Larry Fink’s letters to CEOs.
That was all pre COVID-19. In our now emerging world, there are strong calls for new leadership models and new economic models to address long-standing imbalances and climate change. There are acknowledgements from highly respected people that business’ relationship with employees, customers and suppliers has forever changed.
Mark Carney recently wrote in the Economist ‘When it’s over, companies will be judged by “what they did during the war”, how they treated their employees, suppliers and customers, by who shared and who hoarded.’ I wholeheartedly agree. I would add, however, my explicit belief that companies will also be judged on how their actions went beyond the boundaries of their immediate stakeholders, i.e. how they voluntarily did more than what was required on behalf of communities that surround the business.
The network of companies that make up the London Benchmarking Group (LBG) Canada invest around $500 million of shareholder dollars each year in communities. Representing a range of industries – companies join LBG Canada because they believe their voluntary actions in community really do matter. They leverage their involvement to build capacity to design for impact and to report on the community and business value achieved through their actions.
Every calendar year Q1, you will find me conducting a line-by-line audit of each company’s previous fiscal year activities in order to categorize transaction as wholly or partially community investment, or as ‘other’. These distinctions matter – a lot – because many companies report their community investment dollars publicly. It’s not only a matter of being accountable, it’s about corporate expression that communities – be they physical, demographic or issue-based – actually do matter to their business.
Consider a very simple (and real) example: two companies have robust scholarship programs. The first is for any youth seeking support for post-secondary, the second is for the children of their employees only. Both benefit youth seeking support for further study, but only the first would be considered community investment.
LBG companies commit to upholding these definitions because they seek credibility in their external reporting of social impact. As businesses create and innovate in community, a common understanding of what is and is not community investment will only accelerate in importance.
In the absence of defining what is and is not community investment, corporate reputations are at risk. This is an especially powerful discussion in light of the COVID-19 crisis. During this time, companies are taking some extraordinary measures to support their employees and customers. And the rub? These actions are vital to shoring up employment and the economy, but they are not community investment, i.e. voluntarily giving to others outside of your core stakeholder circle.
Don’t get me wrong. Many companies are doing amazing things. Canadian Business for Social Responsibility and Public Inc are keeping lists updated that highlight these vital corporate actions. Many are investing in their employees. Many are retooling in order to provide essential equipment and services. Many are proactively supporting their customers to go through very difficult times.
As we navigate through these COVID-19 times, we must remember that corporate community investment is critical to keeping communities strong. It isn’t only up to government and individuals to give, corporations must voluntarily invest as much as possible to keep the communities that surround their business strong.
Someday very soon, corporations will want to report more credibly and confidently about their COVID-19 response. As we #BuildBackBetter, investment in community outside of core stakeholders is central to #Better. The dollars that companies invest in communities every year matter, now more than ever. #CIMatters
 April 16 2020 edition, The world after covid-19; Mark Carney on how the economy must yield to human values