South African companies channelled the bulk of their estimated R11.8 billion corporate social investment (CSI) spend in 2023 into supporting non-profit organisations (NPOs).
According to corporate responsibility consultancy Trialogue’s latest research findings, 84% of companies directed an average of 63% of their spend to NPOs in 2023. While the proportion of companies directing CSI funding to NPOs fell below 90%, the average contribution increased.
“The contribution to non-profits takes place amidst the 8% nominal and 1% real growth in CSI from R10.9 billion in 2022,” says Trialogue managing director Nick Rockey. “Of interest is that 79% of companies reported proactive identification of their major CSI projects, indicating that more companies are operating from defined, conscious strategies, an approach that delivers much greater impact.”
The results, published in the latest annual edition of the Trialogue Business in Society Handbook, reflect a continued recovery in CSI spending, following the Covid-19 pandemic, a slow economic expansion and a challenging operating environment. More than a portion of corporations surveyed (59%) reported an increase in CSI spending, up from 36% in 2021.
Companies reported reluctance to engage in more innovative forms of financing for NPOs, with more than 69% indicating they would offer investments for reserves, unrestricted financing or loans.
Education, social and network development, as well as food security and agriculture, continue to derive the lion’s share of CSI spending from local businesses.
Business aid for education fell from 98% of businesses in 2022 to 78% in 2023, with average spending increasing from 44% to 48%. Nearly three-quarters of companies (74%) help social and network development, spending on average 13% of their CSI in this area. Food security and agriculture received support from 60% of companies in 2023 and benefited on average from 9% of ISC spending.
“As our latest research looks to what the future may hold across the continent and how business might contribute to more effective CSI, we see the growing need for deeper intervention, particularly in the wake of global economic crises and the impending threat of climate change. Companies are increasingly recognising the need to move beyond charitable CSI and towards CSI that is leveraged to drive systemic change. They are also recognising the limitations of CSI budget constraints and the reality that real impact will come from leveraging and integrating whole businesses,” says Rockey.
The Trialogue Business in Society 2023 handbook can be downloaded free of charge from https://trialogue. co. za/businessinsocietyhandbook/trialogue-business-in-society-handbook-2023-loose-online-version/.
Survey Methodology
This 2023 refers to data from the 2022/2023 financial year, which differs between organizations based on the last months of the financial years.
Trialogue’s estimate of CSI’s overhead is based on knowledge research from a variety of sources, aggregating published NPAT knowledge from 151 corporations and published CSI knowledge from 135 corporations indexed on the Johannesburg Stock Exchange. It also takes into account the insights gathered by survey number one. through the Trilogue and knowledge of the South African Revenue Service (SARS).
The main survey data was collected between May and August 2023 through professional researchers who conducted interviews with CSI representatives from major South African companies. Companies also had the option of completing the questionnaire themselves, which was then verified by researchers. There were 68 participating companies.
The corporations surveyed were large: more than two-thirds (69%) had an annual profit of more than R1 billion in their last monetary year and 40% had a profit of more than R10 billion. More than a share of corporations (59%) hired more than 5,000 people and a quarter (25%) hired more than 20,000 people.
The Business in Society Trilogue Handbook 2023 can be downloaded free of charge from https://trialogue. co. za/businessinsocietyhandbook/trialogue-business-in-society-handbook-2023-loose-online-version/.
About the trilogue
Trialogue is a consulting firm specialized in corporate tasks with more than two decades of studies and experience in the industry. The firm provides consulting and conceptual leadership to its clients on sustainability and corporate social investing (CSI).
www. trilogue. co. za
Steuart has given some 500 lectures on South Africa’s progress since 1994 and South Africa’s long-term prospects.