Begging bowl Philanthropy by Community Chest

I’m not in the business of ‘rubbishing’ charities for the work they do, as i believe they have played a fundamental role as ’service providers of need’ and i feel they do their work from the ‘right place’ … ugghmmmm BUT …

I feel many of them will NOT play an important role in solving social and environmental fractures strategically in the future (UNLESS they revolt 360 degrees from their current modus operandi)

Lets take Community Chest in South Africa and this article (http://www.bizcommunity.com/Article/196/422/34925.html)

Written by their CEO Amelia Jones:
Amelia Jones (amelia@comchest.org.za) has nearly 40 years of experience in the social-welfare sector, having spent 25 years as a social worker and over 15 years at the Community Chest. She has been the chief executive since 1996.

and lets comment line for line (see in red below) on the paradigm shift which is needed … (note to my silly self – I hope Community Chest’s CEO will give us some constructive comments on this article – I would like to get a sense whether ’sustainability’ / business models / social enterprise is a discussion internally)

Economic downturn ups the need for social investment
By: Amelia Jones

There’s been a lot said and written about how the economic decline will impact the poorest of the poor, but much of it considers only how people already on the breadline will be affected – not that there will be far more of them.
Conventional wisdom is that because there’s less money in the economy and fewer jobs that it’s the most vulnerable people – the aged, the young and the homeless – who will suffer most. They will, but not necessarily because they have less or no money. YES YES… moving along …

The harsh reality is that these are people who don’t tighten their belts because they are already uncomfortably taut. To survive they often depend on begging enough to buy food, scavenging what they can, either to eat or sell, and depending on social welfare organisations for help when they can’t beg or scavenge.

An economy in technical recession won’t change this. People will still hand over loose change at traffic lights and there’ll still be scrap, cardboard, paper and other items to recycle. The problem is that there’ll be many, many more people desperately trying to scrape an existence and the social welfare safety net will be stretched beyond breaking point. I sense the elevator pitch for increased giving is coming …

The irony is the social welfare system is much like a redundancy policy. In the good times you keep up the premiums, but when times get tough you’re forced to cut back and stop paying – at exactly the time you’re most likely to need the cover.

That’s what’s happening now. Many of the organisations that provide food, shelter, clothing and care for people who have nowhere else to turn now have to contend with dwindling donations, just when demand for their services is most needed.

It’s a desperately serious situation. Last year we saw an explosion of xenophobic violence around the country as desperate competition for scarce resources boiled over. We simply can’t allow a repetition of this.

The Community Chest has already stepped in to bail out at least one beneficiary that has been doing exceptional and essential work for the last 20 years. It wasn’t bad management, poor financial control or over-aggressive expansion that prompted the crisis, just one major funder that cut its social investment budget.

So here is the problem. The money that Community Chest begs for – is just given to these ‘medium size’ NGOs with little / no consideration to the ‘downside’ / sustainability of the investment. There is a finite money out there in the market for grant making – there are thousands of NGOs (growing increasingly) begging for the same pot of money and Africa’s social and environmental fractures are increasing. Thus in the words of Dire Straits ‘Hello Elvis, is anybody home?’ or perhaps ‘Houston, we have a problem’.

Thus these NGOs have to start finding ’sustainable market solutions’ to their problems (BTW Community Chests covers its operating costs by the interest of its investments – ‘quoting their website). My question is whether Commnuity Chest is right service provider to do this work? Their capacity building services seem more orientated on trying to get welfare organisations to spend their money ‘efficiently’ – and apply M&E to some cheque book giving …

We expect to have to provide more such emergency funding this year.

Cutting back is not an option YES YES – we’ve heard this before. Its not like a business is going to read this article and double spending…
In the current economic situation the support we provide our beneficiaries is crucial. We cannot reduce our funding and in some cases will be forced to increase it to ensure that organisations which provide vital services continue to function. Cutting back is simply not an option. The elevator pitch…

Fortunately due to careful planning and prudent investment we are able to provide this support. But we must also be responsible. We have no idea how long the downturn will last and we are exceptionally aware that donations will decline and we may not be able to rely on our normal fundraising such as events and Give-As-You-Earn to contribute as much as they have in the past.

It’s why we’re so dependent on our investments and the continued support of big business. Fortunately some captains of industry have realised social responsibility isn’t just responding in a crisis – although this too is important. To their credit there are large (gullible) companies that have known for some time that just ticking the BEE box isn’t going to be enough to secure the future for their businesses. They are all too aware that the chasm between rich and poor means we’re sitting on a powder keg and that this doesn’t make good business sense.

They know that BEE isn’t sufficiently addressing the massive inequalities and that the people who queued up to vote 15 years ago aren’t yet experiencing the benefits they thought freedom would bring. The so-called freedom generation is even more impatient. They have access to modern mass media, where success is equated with material possessions. They’re demanding their share – NOW.

This is the tinderbox that exploded last May and although temporarily under control, it’s smouldering, not snuffed. Irresponsible election promises won’t help.

Don’t cut CSI spend; make it more efficient and Amelia – this is your solution to the problem – Give more? and make it more efficient? Is this thought leadership?

In the businesses that realise this, the head of corporate social investment usually sits on the manco – at least. They are the companies where CSI is no longer the preserve of the marketing manager’s secretary; where it’s being driven by the CEO. Let’s be truthful here – CSI (Corporate Social Investment for our international audience) is the small silly pot to piss in – Most MAN Cos find it a grudge purchase – R4 billion is nothing in the big picture (our National Lottery pulls that amount out of the economy every year). The real money (Trillions) is locked in financial markets – we need to break that capital barrier and have real investment money driving social capital (Social Enterprise hint hint)

We need more of them, urgently.

It’s why when businesses are looking to cut budgets, I’d appeal to them not to think short-term and slash CSI spend. Rather focus on making it more efficient. Organisations such as the Community Chest can help ensure the investment gets to where it’s most needed, that it’s used effectively and that it’s monitored. It’s what we’ve been doing for the past 80 years. I’m sure Community Chest will help you spend that money – PS … Is this a thought leadership article written for Bizcom or a Community Chest press release (if its the latter, i apologise for my comments as CC is trying to raise more money)

Of course there are also other ways that business can contribute. In-kind donations are always welcome. Depending on the need at the time, these are either distributed directly to beneficiaries or stored so we are quickly able to respond to sudden needs, particularly after emergencies such as fires of floods.

They can also lend expertise. The Community Chest has a proud tradition of volunteerism (in their credit, that is a very good / proud heritage of Community Chest) , with many of our events and programmes such as Carnival, the Twilight Team Run and soup kitchens being run almost exclusively by volunteers. Between events we also have plenty of need for accountants, HR practitioners, marketers, lawyers and others whose expertise is invaluable to us and our beneficiaries.

Just over 80 years ago business played a significant role in founding the Community Chest to invest in social welfare organisations to counter the worst effects of the Great Depression. As the events of the last few weeks have shown, the need today is immense and the role of business will again be crucial.

So, in Conclusion does Community Chest need to re look at how they invest that money – and completely rehaul their funding model and modality? Your comments are appreciated – alongside your suggestions? (If you found that i was treating Community Chest a bit harshly – then please tell me too)

Popularity: 13% [?]

Related posts:

1. Foodbank SA’s MD, Alan Gilbertson gives a response to my previous post
2. Foodbank South Africa: some insight for the discerning social investor
3. Social Enterprise vs Conscious Capital