Corporate social responsibility now a priority

27th Jan, 2016

For many organizations, corporate social responsibility (CSR) was once a purely philanthropic activity to arouse public goodwill with no consequence on profitability.

However, the perception has changed with CSR programmes ranking high on the corporate plans of most organizations. Mr. Joe Otin, a Nairobi based researcher says that organizations are differentiating between CSR, marketing and advertising, with many setting up departments to exclusively handle CSR programmes. “Most organisations have a policy on CSR and these programmes have public interest at heart rather than gaining mileage or visibility in the market,” he said. “CSR activities were initially embedded in marketing departments.”

Otin’s division tracks coverage of different issues by local media. He says the media now receptive to CSR activities. “When most organizations rolling out substantial CSR projects, journalists thought the activities were publicity stunts but the perception has changed,” he said.

He noted well planned and executed CSR projects have the power to position a company differently from its competitors. “CSR projects can differentiate a company from its competitors targeting the same market segment,” said Otin. He said there is need to review the country’s tax regime to encourage more organizations roll-out CSR programmes. “There are now incentives but in some countries, like the US, organizations are exempted from paying some taxes to encourage investment in CSR projects,” he said.
Many CSR programmes target provision of basic services like health, education, agriculture and access to clean water because of widespread poverty, but environmental conservation is also gaining currency.

The strategic importance of CSR has led to transformation of departments of various organisations into a fully-fledge section known as the Foundation. “In recent years, intangible assets such as company values, human and intellectual capital, reputation and brand equity have become important to organizations,” he said.

The Kenya Commercial Bank (KCB) for instance is working with communities in education, livestock, fisheries, health among other CSR activities.

In 2015, KCB Foundation donated Sh 1.5 million worth dialysis machine to Moi Teaching and Referral Hospital- Eldoret.

The equipment will see over 25 patients treated on a daily basis at the facility. The dialysis machine will also ease over-use of the five functioning dialysis machines at the medical facility.

Commissioning the machine, KCB Foundation Chairperson Catherine Kola noted that the donation of the dialysis machine is part of a larger entity in working with communities in curbing diseases.

“Some of the interventions we support include the provision of medical equipment to medical institutions, support of health education programmes and the sponsorship of medical camps especially in low income and marginalized areas,” she said.

She also added that KCB Foundation has invested over 40 million towards the purchase of dialysis machines to support the 47 counties across Kenya.

Kola said the bank through its CSR arm, the KCB Foundation, is keen in supporting county governments with equipment to enhance quality health care services and programmes.

In an earlier interview, the former Kenya Power and Lighting Chief Executive Joseph Njoroge noted that sustaining CSR projects is an obligation that every organization has because it makes money from the community, so it plough some of the earnings back.

He noted that other than granting a company the “social licence” to operate in a particular market, CSR also impacts a firm’s brand equity and profitability.

“When you touch people’s lives, you touch their hearts and hope you have recruited new customers and investors. The community will also back the organization when things are not rosy,” he said.

Kenya Power for instance is actively involved in environmental conservation programmes.

Safaricom Foundation has spent millions in various projects ranging from matters of education, medical, environment and capacity building. In 2010, the Foundation launched a unique CSR programme, World of Difference (Wod), whose objective is to involve employees in CSR projects.

In the Wod programme, Safaricom employees apply their professional and technical skills in philanthropic projects for three months.

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