The CSR of future has to be sustainable, will need to take into consideration climate change and its impact on society, and often dedicated projects will need external donors/funding.
The above came out strongly at the recently concluded ‘10th Annual India CSR Summit’ conducted by CSR Box. Climate change was also the talking point at the 15th Sankalp Global Summit.
The writing is on the wall. CSR strategies will need to don a new avatar.
Let us look at some of the challenges and how CSR strategy can be redesigned.
#1. Climate change
“Now-a-days you cannot predict a normal monsoon season. It rains in December as well and that ruins our crops. We can no longer hope for a normal crop pattern’, says a farmer in one of the agricultural districts of Maharashtra.
Farmers are the most impacted by the vagaries of climate. If earlier they had to deal with nature’s wrath, calamities, and disasters, today, they have to navigate the unexpected challenges that accompany climate change. Food security issues are going to become bigger and bigger as time passes. They need to be prepared.
Tip: If your CSR work is focused on working with farmers and capacity building is part of it, build in climate resilient agriculture strategies so that farmers are future ready.
The relevance of Environmental, Social & Governance (ESG) factors will only grow in stature during the years. In order to survive and to continue to attract investors and funds, companies will need to draw up well designed ESG strategies that touch upon processes and products across the value chain. The ‘S’ in ESG, will also need to have not only a sustainable outcome but also a well thought of exit strategy.
Tip: Rethink on how projects can involve community participation and contribution in the programs. The era of free lunches will cease to exist.
#3. External funding
Currently, the CSR law mandates that projects should be long-term with maximum time permitted being three years. What happens when the project really takes off in the 3rd year but the funds get exhausted? That is where external donors/funders come into picture. Blended finance, as a concept will be well established and accepted by then.
Tip: Funders will enter only if projects demonstrate impact. Make impact assessment during start, mid-way and at the end, a critical part of CSR strategy.
#4. Startups will become integral to CSR strategy
At the moment not many corporates support Startups through CSR funds. The CSR law permits utilization of funds for incubation centres. Government also supports Startups through various funding and mentoring programs. The real challenge lies in the innovative product/process finding a viable market downstream.
Tip: Identify tailored low-cost innovative products (developed by Startups) that address issues prevalent in the communities the company serves. Integrate those products in the CSR strategy. This will provide Startups with a ready market thereby creating a revenue stream.
#5 Go deep
The CSR law permits companies to carry CSR projects in and around geographies where business operates. The result is a skewed development of underserved communities, like, aspirational districts. These districts have been identified by the Niti Aayog as ones that that are affected by poor socio-economic indicators and are the most underdeveloped. In the future, there is going to be a lot of emphasis and perhaps even a push from the government to corporates asking them to align their CSR strategy to include aspirational districts.
Tip: Develop a balanced CSR strategy that addresses both the geographies, thereby ensuring overall growth of the nation.
The above changes also call for CSR professionals to reinvent themselves with new skills and develop relevant competencies to keep pace with the transformation.
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