Giving Is good for business
Giving is good for business
New Zealand businesses want to be more socially responsible but don't know how to form strategic partnerships with community groups, an AUT University study shows.
The Business Social Investment Activity in New Zealand report has been produced by AUT's Institute of Public Policy (IPP). The institute was commissioned by the Tindall Foundation to discover what social investment New Zealand businesses are making, what community and not-for-profit groups need, and what is keeping the two groups apart.
IPP worked with the Tindall Foundation, researchers McKinlay Douglas Ltd, and an advisory group of key players in the areas of community and social investment to develop the report. It is the first major research into business social investment in New Zealand in nearly a decade.
The report found that many New Zealand businesses have well-established community partnerships, but are reluctant to 'blow their own trumpets' by promoting them.
It also recommends that companies make social investment part of their core business practice, rather than continue to view it as charity.
IPP Deputy Director David Wilson says that although many businesses have realised the value of donating time as well as money, often their community involvement is still a result of the business owner's personal philanthropy, rather than their business objectives.
"Properly managed, strategic involvement in community groups gives business more substantial returns than just a warm, fuzzy feeling," says David Wilson.
The study reviewed the growing body of evidence suggesting that strategic social investment can create wealth for business, and found that the corporate benefits of community involvement have become widely accepted internationally.
Reported financial and social returns include a stronger company brand and reputation; increased awareness of the business's role in the community; new skills and elevated morale for employees; attracting and retaining staff; better market knowledge; more customer loyalty; and increased profitability.
In line with the global trend, New Zealand consumers and shareholders are showing a preference for companies that are actively engaged in their local communities, the report says. Many New Zealand businesses also realise supporting their community is sound business practice, but are unsure how to do it effectively.
The report looks at how social investment can be adapted to New Zealand's unique business environment: several big corporations owned by multinational companies — many of which have international corporate social responsibility policies — and a large number of small and medium-sized enterprises (SMEs).
SMEs have the greatest potential for contributing to their communities, although most are in need of strategy advice and connections, says the report. It recommends the use of brokers to act as matchmakers between businesses and community or not-for-profit groups.
AUT Community Relations Manager Ian Leader welcomes the findings of the report. "There is a huge need to grow brokerage of corporate social investment in New Zealand. Brokers like Skills Exchange, the online employee volunteering tool AUT hosts, help businesses and community groups find suitable partners and get the most out of that partnership."
"Business social investment is a massive area of growth worldwide. We can get the benefits of overseas experience by looking at what they've achieved and the mistakes they've made, then applying that experience to New Zealand. It's about taking what works and adapting it to the New Zealand context," says Ian Leader.
IPP hopes to build on the findings of the report to grow social investment in New Zealand. "The next move is to get together with the Tindall Foundation and other organisations associated with the study to look at how we might implement some of the report's recommendations," says David Wilson.