The FINANCIAL — Georgian business leaders discussed a new initiative on being strategic in social investments last week. During the event organized by Eurasia Foundation and American Chamber of Commerce in Georgia (AmCham Georgia), Georgian business leaders talked about the comparative new direction of the Georgian business world.
Mark de Souza-Shields, Director of Capital Markets and SME, held two-day trainings at the Sheraton Metechi Palace Hotel. The purpose of the program was to develop Corporate Social Investments.
“This training was very interesting for Eurasia Foundation as we execute social projects very often. Hence we decided to launch an educational program to help Georgian companies in implementing strategic projects which will be beneficial for society and for the companies as well,” Ani Jobava, project manager, Eurasia Foundation, told The FINANCIAL.
In Jobava’s words, there were several researches done about Corporate Social Responsibility in Georgia and it appeared that most companies try to implement charity projects which are actually only short term plans. So in the long run they don’t manage to completely resolve the problems.
“Right now Georgian companies have programs making social investments in charity, churches, education, health and sports. They need to have a more organized and systematic impact and the programs should be focused on particular activities. The seminar was about how you link your philanthropic investments and your CSR vision to your business,” claimed de Souza-Shields.
In De Souza-Shields’s words, doing CSR returns more success to your business. It makes people more productive and more loyal. People have higher responsibilities and do their job well when they know that their work is contributing to helping less privileged people at the same time as making the company more profitable.
A corporation makes money typically and then brings the power of its values to work, it’s a really good product for business.
“What was important today was the way it was explained to companies that CSR is actually profitable. It’s not a charity; it’s an investment in society that eventually comes back to the company. Though in Georgia a lot of people consider it charity and hence some companies which think of CSR as mere charity feel uncomfortable about doing it,” Emmi Denman, Executive director of American Chamber of Commerce.
Representatives of the participant companies have been pleased to hear a lot of important information about Strategic CSR. Participants of the trainings shared experience about investments they had made in Philanthropy and CSR.
“Magticom has a very strong belief that one of the things we should do is to make sure that everyone has access to a network. We do business in various directions of CSR, direct investing; in charitable actions like helping orphans. What we’d like to do now is to extend into a more formal approach. We want to organize the structure of CSR investing in Georgia,” David Lee, General Director of Magticom, told The FINANCIAL.
“I think that all companies in Georgia are starting to understand right now that we play a role in society and we have to do it in a visible way, not in a quiet way. What Magti does in terms of CSR is also that we employ a lot of people and we’re the largest taxpayer in the country, Magti’s given over GEL 600 million in taxes so far. It’s also a contribution to society, we’re a big employer, and we’re happy to be known as a company with a lot of people,” David told The FINANCIAL last year.
According to Sarah Williamson, Vice President of UGT, CSR is very important internally, and both inside and outside the company.
“We already introduce systemic loans and an agreed employment package, and help people to continue their education, but I think this seminar will help us to invest in the right direction. I think UGT with other companies will give an example of how CSR works in other directions as well,” said Williamson.
Companies believe that when they are more open with stakeholders and place social responsibility at the core of their business strategy they will be more competitive, attract and retain the best talent, and gain access to new business opportunities, says a global study released by IBM (NYSE: IBM).
According to IBM, many companies now see corporate social responsibility as a growing opportunity rather than just a regulatory compliance or philanthropic effort, with 68 percent of those surveyed focused on generating revenue through CSR activities. In addition, 54 percent believe CSR initiatives contribute to giving their corporations a competitive advantage.
Driving these beliefs is the rising influence of customers who, thanks to their ability to research and share information on the internet, have become highly sensitized to a broad range of issues — everything from concerns about climate change, to product safety issues, to labour practices, to corporate financial accountability, to questions about whether corporations are returning enough of their profits to the community.
While customers are becoming the chief driver of this increased focus on CSR, 76 percent of businesses surveyed admit they don’t truly understand their customers’ CSR concerns. In fact, even businesses that feel they are knowledgeable and prepared to deal with CSR issues may not be. Nearly two-thirds of companies surveyed believe they have sufficient information about the sources behind their products and services to satisfy customer concerns, but half of those admit they don't understand their customers’ CSR expectations well.
“Corporate Social Responsibility is becoming more and more accepted nowadays. GOGC has successful partnership relations with international energy corporations that have already effectively accepted CSR standards and are governed by the principles of responsible business ethics. As standards of business culture in Georgia are currently emerging, GOGC is ready to take further steps to improve the quality of life for employees and their families as well as for the local community and society at large,” Zurab Janjgava, the General Director of Georgian Oil and Gas Corporation (GOGC), told The FINANCIAL.
TIPS from de Souza-Shields:
“For me it is very important that business leaders look into their hearts and realise what work of value they have done. We know that everybody believes in healthy family life and since we all share these personal values, they should be brought to work and thus make companies invest in those values.
When investments are put in a structured way, they bring direct feedback to the company as never before.
A tip for Georgian companies is to believe that it’s possible to make money and consider values at the same time. It’s good for everybody, for the company and the community in general.
Mark de Sousa-Shields manages Enterprising Solution’s Large Enterprise and Capital Markets practice. He has been working to promote CSR for over 20 years in developing and developed countries. He is active in helping to finance small and medium sized enterprise development through innovative mechanisms (e.g. from private equity, venture capital, guarantee funds, commercial banks etc.)
Before co-founding Enterprising Solutions, Mr. de Sousa-Shields co-founded and was the Executive Director of the Social Investment Organization in Canada, where he assisted in the creation of numerous innovative social investment and corporate social responsibility (CSR) schemes. Mr. de Sousa-Shields was an advisor to the United Nations Environment Program Financial Initiative in Latin America and is a member of the Steering Committee for the International Working Group of the Social Investment Forum of the United States.
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