Community Investment Strategies
Companies around the world engage in community investment (CI) efforts as a way to promote local development and benefit stakeholders in their areas of operation. For the private sector, community investment—a subset of overall social performance and corporate responsibility—is linked to competitiveness and to creating an environment conducive to private investment while promoting local development. In contexts where social risks and expectations are high, benefits channeled effectively through community investment programs can help companies gain a social license to operate, access land, reduce project and reputational risks, boost productivity, meet government requirements or global standards, and/or successfully compete for the next venture.
Companies around the world engage in community investment (CI) efforts as a way to promote local development and benefit stakeholders in their areas of operations. The aim of this handbook is to help IFC client companies and the wider private sector operating in emergining markets to think strategically about how they can support community investment projects that are successful, sustainable, and consistent with their business objectives.
The original Community Development Toolkit (CDT), which this document updates and replaces, was produced in 2005. It was the product of a joint project between the World Bank Group’s Oil, Gas and Mining Policy Division, the Energy Sector Management Assistance Program (ESMAP) and the International Council on Mining and Metals (ICMM). The development of this revised toolkit was informed by a review of the usage of the 2005 version. It was also informed by approaches developed in the intervening period by other organizations, notably the International Finance Corporation (IFC).
At the beginning of 2012, there is no end in sight for the economic malaise and fiscal crisis that is gripping many parts of the developed world. Global growth is slowing, even in emerging economic powerhouses like India, billions of people remain trapped in poverty. As politicians debate the best way to reform the financial system to prevent future collapses, protestors around the world are questioning the moral foundations of the capitalist system itself. Despite the crisis, shifting attitudes, new technologies and the promise shown by the microfinance revolution have led to new opportunities for market-based innovations to serve the global poor. These are being pioneered by ambitious entrepreneurs who are taking great risks for little potential financial reward, but for tremendous potential social value. Such ideas have elicited a rush to the new field of ‘impact investing’.
This Toolkit has been developed jointly by PricewaterhouseCoopers (PwC) and the World Business Council for Sustainable Development (WBCSD). It is a globally applicable resource designed to help financial institutions support the management of forest resources through sustainable and legal timber production and processing, and markets for carbon and other ecosystem services.
The Toolkit incorporates detailed input from some of the worlds leading commercial banks, forestry companies, certification bodies and NGOs.
The genesis of this article occurred at the FSG-hosted Shared Value Summit in Cambridge, Massachusetts in June 2011 where sixty company representatives and co-authors of the Harvard Business Review article “Creating Shared Value,” Michael E. Porter and Mark Kramer, identified measurement as a key driver of shared value adoption. Nestlé, Intel, InterContinental Hotels Group, and the Rockefeller Foundation committed to work with and support FSG in developing this article on measuring shared value. Insights were drawn from a systematic literature review, in-depth interviews with featured companies, and FSG’s work on shared value with dozens of corporations
The 2050 Criteria provides a framework to identify responsible practices in key soft commodity sectors around the globe, including:
The Corporate Engagement Project (CEP) works to ensure that the presence of companies has a positive, rather than negative, impact on the communities with whom they work. Since 2000, over 60 international companies, mostly from the extractive industries - operating in Africa, Asia, Latin America, Australia, and North America - have participated in the Project. Insights from Corporate Engagement Project were published in May 2009 in Getting it Right: Making Corporate-Community Relations Work by Luc Zandvliet and Mary B. Anderson. CEP is part of CDA Collaborative Learning Projects, a non-profit organization in Cambridge, Massachusetts.