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Business and Society Programme DP/118/2000 ISBN 92-9014-626-5 First published 2000 Making community investment work By Andrew Wilson Ashridge Centre for Business and Society Download PDF Version

1. Introduction

2. The extent of corporate community investment in the United Kingdom
2.1 Increasing power and impact of business
2.2 Rising expectations
2.3 Media scrutiny and information technology
2.4 Changing role of government

3. Corporate responses
3.1 The three waves of management
3.2 The London Benchmarking Group

4. Using CCI to enchance employment opportunities
4.1 Secondments
4.2 Project assignments
4.3 Team challenges
4.4 One-to-one support
4.5 Individual volunteering

5. Company support for employee involvement
5.1 Allowing time-off
5.2 Matching supply and demand
5.3 Recognizing employee's contributions
5.4 Matched giving
5.5 In-kind support
5.6 Training and development

6. The case studies
6.1 FI Group plc
6.2 Diageo plc
6.3 British Telecommunications plc
6.4 John Laing plc
6.5 Focus

7. Lessons from the case studies
7.1 CCI is about meeting business objectives
7.2 CCI is a professional management function
7.3 CCI exploits a wide range of corporate resources
7.4 CCI must be communicated
7.5 CCI is about partnership

8. Public policy implications
8.1 Business can contribute to public policy
8.2 Education for employment is an issue for business and government
8.3 Spreading the message

9. References

1. Introduction

This paper examines how successful companies in the United Kingdom are using corporate community investment (CCI) initiatives to promote employment opportunities. It begins by outlining the extent and nature of CCI activity in the United Kingdom and examines some of the drivers which are forcing companies not only to take CCI more seriously, but also to pay more attention to their broader business principles. The paper then goes on to consider how business is responding to these challenges in the way in which they manage and organise their CCI activities. This discussion provides an important basis to consider the full range of ways in which companies can take action:

• Through their business principles by respecting diversity and providing equality of opportunity.
• Developing the skills and abilities of employees through community involvement projects.
• Creating training and employment opportunities outside the company.

While all three are vitally important, the first area is beyond the scope of this paper. Rather, the discussion centres on the two other forms of action in relation to CCI. Key to this is an examination of employee involvement and the following issues are explored in some depth:

• Forms of employee involvement.
• How companies can support employee involvement.

The paper then considers five case studies, which are used to illustrate different activities, and approaches to developing employment opportunities through CCI. It concludes by considering the lessons from the case studies and discussing the potential implications for public policy.

2. The extent of corporate community investment in the United Kingdom

In the United Kingdom, CCI is big business and is growing rapidly. For example, Pensions Investments Research Consultants (PIRC, 1998) found that the average donation of 85 companies included in the Financial Times - Stock Exchange index (FTSE 100) was more than £1.2 million in 1996/97. This represented an increase of 33 per cent over the previous year.

More recent research, undertaken by the Directory of Social Change in 1998, further illustrates the scale of corporate giving in the United Kingdom:

• The top 25 corporate givers had contributed £118 million.
• More than 450 companies gave more than £50,000.

While not as well documented, there has also been a substantial increase in non-cash support by business for communities. For example, in a 1997 survey of its 400 member companies, Business in the Community (1999) found that 83 per cent had some form of employee involvement.

The most recent survey conducted by the Per Cent Club (Business in the Community, 1999) found that the United Kingdom's top 115 corporate givers together contributed more than £303 million in 1999. This figure was made up as follows:

• Cash contributions £200m (73 per cent).
• Employee time £25.5m (8 per cent).
• Gifts in kind £35m (11.5 per cent).
• Management costs £22.3m (7.5 per cent).

Of the many drivers that are encouraging companies to take action in this area, there are four key issues behind the growth in corporate investment in the community:

• The increasing power and impact of business.
• Rising expectations of business.
• Increasing media scrutiny.
• The changing role of government.

Each of these themes is considered in the following paragraphs.

2.1 Increasing power and impact of business

It has been argued that the increasing size and influence of companies has placed them in the position of the most powerful social construct of the present era. In The Economist's publication The World in 1997 (1998) Charles Handy wrote:

"Draw up a list of the world's 100 largest economies in 1997 and 50 will turn out to be corporations."

Research by the World Watch Institute (1999) puts this in perspective: the 500 top corporations in the world control 70 per cent of world trade and account for 30 per cent of world GDP. Thus major companies have a profound impact on society whether they like it or not. Some obvious areas of concern about corporate behaviour are:

• The negative social impacts of downsizing and redundancies. Research by the Institute for Policy Studies found that 10 per cent of the largest US companies had each laid off more than 3,000 workers. At the same time, the stock options of the CEOs of these firms went up over US$25 million.
• Business scandals.
• The ethical and social concerns raised by new technologies, such as biotechnology and genetically modified organisms.
• Public concern that the free market does not account for all of the costs to society of business, such as environmental impact.

2.2 Rising expectations

Because of the perceived power of big business, it is not surprising that different groups throughout society are increasingly demanding that companies act in an environmentally and socially responsible way.

Twenty years ago, large companies were granted trust. There was respect for the idea of ownership, and as long as they stayed within the law, businesses had freedom to do what they wanted. People who asked questions were seen as interfering busybodies who lacked legitimacy.

The above quote is taken from a paper by Shell UK's Peter Hunt (1995) that considered the reaction of the Royal Dutch Shell Company to the public outcry at the decision to sink the Brent Spar oil storage platform in the Atlantic. The plan to dispose of the oil storage platform in the deep sea was considered by the scientists advising Shell as the most environmentally responsible course of action. Permission to carry out the operation had been granted by the relevant government authorities.

Yet, when the environmental group Greenpeace started mobilizing concern over the proposal, there was widespread condemnation of Shell and vociferous public reaction culminating in attacks on Shell petrol service stations in Germany.

A key lesson of this incident - and one that is applicable to all companies - is that business no longer operates in a vacuum. The corporate world is open to very close scrutiny of all aspects of its behaviour - in deciding where to locate, in developing and creating new markets, in the way in which goods and services are produced and distributed, in the tone and content of advertising, in the interactions with employees and suppliers, etc.

Coupled with this increasing scrutiny of their behaviour, companies are also acknowledging responsibilities to a wide range of stakeholders - employees, customers, suppliers, and the communities in which they operate - as well as their shareholders.

Companies are increasingly concerned about building trust and credibility among these different audiences by developing a strong corporate reputation for acting in a socially and environmentally responsible manner.

Recent research by MORI, (1997) has shown that there is a direct correlation between corporate reputation and the public's perception of how well a company discharges its responsibilities to society, as the chart below demonstrates.

As can be seen, the perceptions and expectations of the public about the way in which a company takes its social responsibilities seriously are important in shaping opinions about a companies reputation.

Other research undertaken by MORI (1998), on public attitudes towards corporate responsibility and community involvement found that:

Spontaneously, the main elements of social responsibility continue to be seen as environmental care, employee welfare, community involvement and responsiveness to customers. Eighty per cent of the public say knowledge of a company's activity in this area is important in their judgement of a company, including one-third who say it is very important.

There is clear evidence that people also make a link between companies that are actively involved in the community and those that are good to work for. For example, in 1997 (MORI, 1997) asked the public how they felt about the statement, "A company that supports society and community is probably a good company to work for". Responses were as follows:

• Strongly agree 32 per cent
• Tend to agree 55 per cent

The importance of employee satisfaction is now recognized as a key component of business success. In 1996, MORI conducted research into the relationship

Graph 1. The relationship between social responsibility and corporate reputation

between employee satisfaction and advocacy of the employer's products and services. The key findings of this research were:

• 41 per cent of satisfied employees recommend their company's products.
• Only 4 per cent of dissatisfied employees recommend their company's products.
• 30 per cent of dissatisfied employees speak unfavourably of their company's products.

In addition, opinion formers (usually taken to mean politicians, civil servants, the media, and industrialists) are increasingly interested to know more about corporate community involvement. A MORI survey of Labour Members of Parliament conducted in 1997 found that social responsibility was second only to treatment of staff in importance in judging a company. The same study also found that over two-thirds of Labour MPs felt that industry and commerce should play a greater role in the community.

Companies have not failed to recognize such rising expectations across a whole range of social issues. Even as far back as 1996, seven out of ten business leaders questioned in a MORI "Captains of Industry Survey" (1996) agreed that a successful business will better serve the needs of its shareholders by focusing on the needs of its customers, employees, suppliers and the wider community. Interestingly, 23 per cent agreed that an exclusive focus on the shareholder could actually be counter-productive in increasing shareholders' value in the long term.

This recognition of the importance of taking into account stakeholders can be seen in the growth of companies reporting on social and environmental matters. Research conducted in 1997 by PIRC (1998) found that:

• 226 companies (65 per cent) in the FTSE 350 report in some form on environmental issues (including 89 of the FTSE 100).
• 103 companies report on social or community issues in the annual report or environmental report (including 58 of the FTSE 100).

While many companies are reporting on social issues, leading edge companies are beginning to produce social audits, which outline the impact of the organization on society. The recent past has seen a significant shift in the type of organization producing such reports. Previously, this form of social accounting and reporting has been the sole preserve of companies that have a distinctly campaigning edge to their activities (e.g. the Body Shop and Ben & Jerry's). It is now clear that the practice of social reporting is becoming mainstream, with Shell International, BP/Amoco, British Telecom, NatWest Bank and United Utilities among the growing number of multinational "blue chip" companies producing social reports.

2.3 Media scrutiny and information technology

Increased media attention on business behaviour has helped to raise public awareness of issues of corporate responsibility. In addition, technological advances, particularly the Internet, have resulted in immediate access to information about ethical and environmental problems.

The speed of this technological revolution is staggering: according to the Worldwatch Institute (1999), in the last decade the Internet has more than doubled in size each year. An alternative view on the way in which Internet traffic has grown was provided by the Observer Guide to the Internet in January 1999. This suggested that radio took 50 years to reach its first 50 million users. Television took 15 years to reach the same target. In contrast, the World Wide Web took just three years.

This trend towards increasing access to information is very unlikely to abate as we move into what the Shell scenario planners have dubbed the "CNN world" - a world where no political or corporate activities go unnoticed because the media has instant access to every corner of the globe. As cyberspace guru Esther Dyson (1998) has argued:

Executives and their organizations will have to learn to live with increased visibility and perhaps even more scary, a loss of control over corporate image.

A recent article in Business Week (1998) entitled, "A Site for Soreheads" examined the increasing use of "hate" sites to exchange information, organise boycotts and coordinate lawsuits against particular companies. According to the article, more than 100 of America's biggest brand names have been targeted with "hate" sites. Business Week went on to argue that this gives public interest groups and disgruntled workers unprecedented power to lash out at companies worldwide.

2.4 Changing role of government

An additional factor that is encouraging companies to consider their broader social responsibilities is the changing relationship between business and government. Within many developed economies the role of the state is being redefined. In the United Kingdom, in particular, government is seeking to work with business to deliver a wide range of social and welfare services through public-private partnerships. It is possible to identify three imperatives that explain why the United Kingdom government is actively seeking to develop such initiatives.(Endnote 1)

The first is simply an ideological belief that views partnerships as an inherently advantageous way of working. One important aspect of this ideological imperative concerns changing views on the delivery of welfare services. Much has been written in the recent past about the "privatization" of the welfare state. The United Kingdom has seen an unprecedented growth in the range and scale of private sector involvement in areas such as economic regeneration, education, healthcare, social housing and pension provision.

The second imperative driving public-private partnerships is entirely pragmatic. At its simplest, this can be described as the notion that by working together, both sectors can improve the quality of public service provision. Closely related to this notion of improved provision is the idea that partnership working is able to improve the skills and competencies of the players involved - both business and government.

The third key imperative for establishing partnerships is financial, encompassing two inter-related issues. From the government's point of view, public-private partnerships are able to secure additional support and funding from the private sector which otherwise might not have been available. For the corporate sector, working in partnership with government is becoming essential if real progress is to be made to address social issues such as unemployment, crime, poor educational standards, and the myriad of other causes that contribute towards social exclusion - and the real costs this presents for United Kingdom business.

3. Corporate responses

Faced with all of these pressures, it is not surprising that many leading companies are rapidly reassessing both their contribution to society, and the way in which they manage, measure, assess and communicate that contribution. One important element of this trend is the growing professionalization of the CCI function within business. This section considers how CCI management has grown and developed in UK companies in recent years.

One of the earliest substantial assessments of how companies manage their CCI in the United Kingdom was made by the management consultancy Bain and Company (Giles, 1992) in conjunction with Business in the Community. This research, conducted in 1992, found that companies tended to get better results for both the company and the community when their CCI programmes had the following four features:

• Community involvement linked to corporate objectives.
• Specific, measurable targets.
• Formal policies.
• Regular reviews of activities.

In other words, success was much more frequent when businesses applied the same disciplines to managing CCI as they did to any other part of the business.

3.1 The three waves of management

Building on these findings, David Grayson at Business in the Community (1994) published a three-wave model describing how management of the CCI function was changing in the United Kingdom. This model is outlined overleaf.

In essence, this model suggests that over time the rationale for CCI has changed from a purely altruistic, philanthropic activity to one in which companies are acting out of a sense of "enlightened self-interest". It is now widely accepted that businesses make the most significant and meaningful contribution to society where there is a mutual benefit for both the company and community.

Table 1. Three waves in CCI management.

Three waves in CCI management
	First wave	Second wave	Third wave
Rationale	Philanthropy	Strategic philanthropy	Community investment
Management	Ad-hoc administrator Detached	Systematized Manager Line structure	Professional entrepreneur/ Consultant Integrated
Approach	Passive Chairman's whim Primarily cash One-offs	Respond in target areas Drills in place Range of help Working with issues	Initiating Business focused Business resources Nurturing/Building capacity

In terms of managing the CCI function, the most sophisticated companies are now expecting their CCI professionals to act as internal consultants to the rest of the organization - encouraging all business units and different management functions to work together to deliver community involvement activities.

In addition, the model highlights how the approach to CCI has changed radically in recent years. For the vast majority of companies, community involvement can no longer be characterized as a peripheral activity, directed at the discretion of the Chairman or other senior managers, and involving only one-off cash donations.

Today's leading companies treat CCI as mainstream to their activities. The aim of leading organizations is to make CCI business-focused by tying in community activities to the mission, vision and strategic goals of the operation. In addition, CCI is increasingly about using all the resources of the company - in particular the skills and knowledge of its people. Two very brief examples illustrate this "third wave" approach to CCI.

a. The NatWest Group - one of the United Kingdom's leading banks - has a major CCI initiative entitled Face2Face with Finance. This involves employees working with teachers in local schools to improve the financial literacy of school children. Designed in close consultation with teachers and educational authorities, the programme integrates into the core curriculum taught in all schools in the United Kingdom. The initiative delivers real benefits to all those involved by:

• Developing the skills and abilities of NatWest employees who present the programme in schools.
• Improving young peoples' skills in money management.
• Enhancing the image of the bank.

b. Unipart - this major automotive component manufacturer has contributed to an innovative partnership in Oxford initiated by the probationary service, the TRAX Motor Project. TRAX works with young offenders and potential offenders to reduce car crime. The project runs in the local community where Unipart is located and where many of its employees live.

The aim of the TRAX project is to channel the enthusiasm of young people for cars - which had previously been directed to stealing cars - to repairing and preparing vehicles for racing. In working with these young people, employees of Unipart:

• Have contributed to a reduction in the re-offending rate of those involved in car crime.
• Gained a better understanding of how vehicles are vulnerable to theft and as a result developed new products to deter car thieves.
• Helped to improve the well being of local community by reducing levels of crime.

These two examples serve to illustrate how leading organizations are designing their CCI activities to deliver real benefits to both the local community and to the company itself. However, it is also important to note that such examples are relatively uncommon.

The three-wave model has been presented and discussed at the joint Ashridge and Business in the Community course on Managing Corporate Community Investment since 1993. In that time there has been a discernible movement across the three waves, although the following observations are noteworthy:

• The bulk of companies in the United Kingdom are still predominantly in waves one and two.
• The notion of "chairman's whim" (i.e. unplanned and ad hoc activity) remains common in even the most experienced companies.
• Many companies that do exhibit third wave features are still managing certain parts of their CCI programme within waves one and two. The third wave approach tends only to be prevalent for major projects.

Despite these caveats, the way in which CCI is planned, managed and executed among leading UK companies is becoming progressively more sophisticated. This is reflected in the growth of increasingly refined models that define and describe the way in which CCI is integrated into mainstream business.

3.2 The London Benchmarking Group

One such model is that developed by the London Benchmarking Group which describes how companies are considering their community impact across a continuum, ranging from charity to business basics. The model is illustrated in the diagram overleaf.

This model suggests that the major contribution business can make to society is through carrying out its everyday activities in a socially, environmentally and ethically responsible manner.

In addition, there is room for a large amount of well-managed, business-focused activity that aims to be of benefit to both the company and the community, but this is outside the 'business basics' of running the company.

Finally, while charitable activities (such as cash giving to social causes) might be appropriate, these represent only a small part of the contribution business can make to society.

Graph 2. The London Benchmarking Group

Source: (London Benching Group and Corporate Citizenship International, London, 1997)

4. Using CCI to enhance employment opportunities

Building on these two models of approaches to CCI outlined above, this section goes on to consider more specifically how UK companies are using their CCI activities to promote employment opportunities. In essence, an individual company can take action through any combination of three different approaches.

a. The business basics - in carrying out the everyday operations of the company, a business should ensure that its employment policies and practices (e.g. recruitment, selection, promotion, opportunities for training and development, etc.) respect diversity, equality of opportunity, and provide a suitable work-life balance.

b. Internal opportunities - a company can encourage employees to participate actively in its CCI programmes and in so doing develop the skills and abilities of staff.

c. External opportunities - a company can use its CCI programmes to create work experience, training and employment opportunities for those outside the company.

It is inappropriate in this paper to discuss in depth the first area identified above - the business basics. The remainder of this section considers in greater detail the ways in which companies can contribute to job enhancement and job creation through voluntary CCI initiatives.

There is a vast range of different ways in which employees can participate in community involvement activities. The following classifications are derived from work recently undertaken by Mike Tuffrey (1998).

4.1 Secondments

Secondments are formal breaks from work, for anything from a few hours a week to many months on a full-time basis. Typically, during a secondment the employee is assigned to carry out a particular task or function working with a voluntary sector organization or charity. During their normal paid hours, the employee will be away from the workplace undertaking a specific project in the community, structured in a way that develops their skills and abilities.

Although the employee might spend a considerable amount of time away from the workplace, their employer will pay him or her and their normal job will be held open for their return. Marks and Spencer, the UK retailer, uses 100-hour secondments where staff identify their training needs and a suitable community project is found that matches those needs. Usually such assignments are completed over a three-month period, with the employee spending on average one day a week away from the workplace.

Whitbread, the leisure group, when seeking to fill a management position, look to develop potential candidates through secondments to community projects rather than using traditional management training courses.

4.2 Project assignments

Project assignments, which might involve either individuals or groups of employees working together, are similar in many ways to secondments. However, a key difference is that such placements typically offer less opportunity for employee skills development.

The essence of project assignments is for employee volunteers with specific skills to help develop the capacity of voluntary sector organizations and community groups. Project assignments are often undertaken by professional firms (e.g. solicitors, lawyers, accountants, architects or IT specialists) who are able to offer professional advice and guidance on specific issues on a pro bono basis.

4.3 Team challenges

Team challenges, as the name suggests, involve a team of employees (who might or might not usually work together) who respond to a practical challenge to achieve a specific goal for the benefit of the community. Team challenges enable the company to work in the community with projects that offer real benefits to a community partner and meet the personal and professional development needs of employees.

Boots, a pharmacy and healthcare company and retailer provide a good example of how such team challenges work. One Boots team challenge involved a small group of employees using their painting and decorating skills to refurbish the main community room at the Nottingham Mencap Activity Centre. The team was responsible for raising enough money to cover the decorating costs and provide some new furniture. It was seen as an important team-building opportunity while helping a very worthwhile cause.

4.4 One-to-one support

This type of employee involvement in the community usually sees employees working with individuals such as school children or young offenders as a personal mentor, tutor, or friend. Such activities can take place either in paid time or in the employees' own time.

A good example of this type of employee involvement is the Roots and Wings programme, which is run by Business in the Community and supported by a number of leading UK companies. The programme encourages workers to act as mentors for school children, typically spending between one or two hours a week working with individual students both in their schools and at the workplace. The employer might allow time off during the normal working day for this activity, or the employees might be encouraged to carry out the volunteering in their own time. Such assignments provide considerable personal development opportunities for both the employee and the young person they are mentoring.

4.5 Individual volunteering

This final category of employee involvement in the community is something of a "catchall", comprising a wide range of different volunteering activities. It can include any personal voluntary activity, supported by the employer or in the employee's own time, which in some way contributes to the community.

Many companies, for example, support and encourage staff to become trustees or governors of local schools or community groups. Alternatively, workers can sit on management committees or the management board of local charitable organizations.

In addition, employees can be involved in a wide variety of local community activities - from fundraising for charity to offering time and skills - in a variety of different ways. Often such endeavours are conducted in the employee's own time, but they can be supported by the company in a number of different ways.

The following section considers in greater detail how companies can support the different types of employee community involvement activities that have been described in the preceding paragraphs.

5. Company support for employee involvement

Just as there is a great diversity in the ways in which employees can be involved in the community, so there are a wide variety of ways in which employers can support and encourage such activities. These comprise:

• Allowing time-off.
• Matching supply and demand.
• Recognizing employee's contributions.
• Matched giving.
• In-kind support.
• Training and development.

Each of these is discussed in brief overleaf.

5.1 Allowing time-off

The most direct way an employing organization can support employee involvement in the community is by allowing its staff to carry out such activities in normal working time. This implies meeting the salary and other employment costs of the employee while he or she is absent from work.

In this respect, line managers have a critical role to play in both encouraging and allowing staff time for volunteering activities. One organization that has formalized a system to facilitate this process is KPMG, the professional services organization, which has a time bank system that recognizes and supports employee volunteering activities.

5.2 Matching supply and demand

Employers can also encourage employee involvement in the community by making it easy for people to get involved. Companies can publicize opportunities for volunteering and secondment, helping to match willing employees with the needs of the local community. Some organizations fulfil this role with a volunteer coordinator; a dedicated individual who performs this "matching service".

IBM has developed a computer-based volunteer management service, VOLBASE. This publicizes volunteering opportunities to staff and matches employee interests and skills with the requirements of community groups and voluntary sector organizations. A more recent example of using IT to support employee involvement is COOL (Community Opportunities On-Line) developed by United Utilities - a computer-based matching service.

5.3 Recognizing employee's contributions

An important way of boosting the scope and scale of employee volunteering is through awards schemes that recognize the contribution made by individuals and teams working in the community.

At its simplest this might include positive coverage in internal newspapers and bulletins. More effective are formal schemes that offer awards to employee volunteers. These awards usually take the form of a cash prize that is given to the charity or voluntary sector group the volunteers are supporting. NatWest and Whitbread are among many organizations that run such award schemes, which are sponsored by the Chief Executives of the respective companies.

5.4 Matched giving

An alternative to one-off award schemes is for companies to offer cash support to match funds raised by employees, or to provide financial assistance directly to community groups which employees support with their own time. BT is an example of a company offering both types of support. In 1998 British Telecommunications employees raised almost £1.3 million for around 2,000 charities through a payroll giving scheme, a figure which was matched by the company's own contribution. In addition, employees can apply for a grant from BT to support their own voluntary and fund-raising efforts.

5.5 In-kind support

Rather than offering cash, many companies assist employee volunteers by "in-kind" support to match employees' own commitments. These can take the form of donations of products or redundant equipment; the use of facilities such as buildings to hold meetings; or the loan of machinery or transport.

Royal Mail is one leading company that offers support of this kind. It is meant to be "pump priming" in nature, encouraging activities and enabling projects to become self-financing. The support offered by Royal Mail is provided for employees who undertake volunteering activities in their own time.

5.6 Training and development

The final way in which companies can support employee involvement is by offering advice, guidance and training in specific skills and competencies necessary for working in the community. For example, NatWest provides training programmes for employees who serve as trustees on the boards of charitable organizations; while Lloyds TSB is one of many companies offering training opportunities for staff who are school governors.

6. The case studies

This section considers specific approaches undertaken by five different organizations towards developing employment opportunities through CCI initiatives. The case studies have been selected as examples of CCI programmes that address the two key issues identified in section 4 of this paper:

• Developing internal opportunities by enhancing the skills and abilities of existing employees.
• Developing external opportunities by using CCI to create work experience and employment opportunities for those outside the company.

6.1 FI Group plc

The FI Group's core business is outsourced IT applications and business technology services. It works in partnership with a wide variety of companies in the finance, retail and leisure and service sectors. A distinctive feature of the organization is its flexible and widely dispersed workforce. Of the 2,500 employees, only 1,700 are salaried workers while the remainder are associates. In addition, FI Group people (both employees and associates) are often based in clients' own facilities as well as FI's centres.

The FI Group's community policy commits the company to:

• Support and encourage its workforce members to become involved in community and charitable activities through volunteering.
• Encourage its managers to look for development opportunities for their team members through volunteering and other community activities.
• Give priority to supporting schemes, which will help people lead successful working lives, particularly through the medium of information technology.

The FI Group has established a flagship programme with the St Basil's Centre for the Homeless. In the recent past, FI employee volunteers have:

• Run presentation skills workshops for St Basil's managers.
• Provided interview skills training for young people in order to assist their return to work.
• Mentored St Basil's employees by allowing them to shadow their own FI activities.
• Helped St Basil's evaluate its processes, procedures and use of IT and donated computer equipment to improve the efficiency and effectiveness of its operations.

As a result of these and many other activities with the St. Basil's Centre, the FI Group has seen a substantial and positive impact on employee attitudes towards the company. The company commissions independent surveys to provide feedback on workforce opinions and satisfaction levels. The results allow the Group to benchmark its performance against industry norms and to develop and implement programmes to improve satisfaction.

The last full workforce survey included questions about FI's community programme. Feedback indicated that one in five of the workforce had been involved in the programme at some time in the recent past. Of those who had been involved:

• 74 per cent had an improved perception of FI.
• 58 per cent believed they had developed personally.
• 35 per cent believed they had developed professionally.

The FI Group's programme has also resulted in increased awareness of, and support for, voluntary groups supporting young homeless people in the regions in which FI operates.

6.2 Diageo plc

Diageo is one of the world's leading consumer goods businesses, formed as a result of the merger between GrandMet and Guinness. Its brands include Burger King, Pillsbury, Haagen Dazs, and a wide range of alcoholic drinks.

In 1992, GrandMet joined forces with Shelter, the national charity for homeless people, to investigate the problem of unemployment and homelessness. The aim of the partnership was to seek solutions to the "catch-22" problem of 'no home/no job - no job/no home'. Young people who are both unemployed and homeless find it very difficult to break out of this circle - without a home they cannot apply for work, and without work they cannot secure accommodation.

GrandMet and Shelter looked at the Foyer network in France. This is a chain of hostels for homeless young people, providing accommodation, job search advice and training opportunities. The French system is based primarily in inner cities and has made a major contribution towards breaking the link between unemployment and homelessness.

The Foyer Federation was launched in the United Kingdom in 1994 as a partnership between Shelter and GrandMet, with help and support of several other companies and the government. The company provided core funding and premises and the initiative now has the status of an independent charity.

Today there are 68 fully operational Foyers in the United Kingdom with a further 29 due to open this year. There are a further 150 in various stages of development.

Results and progress of the initiative are regularly tracked and surveys show that as many as 6 out of 10 young people in any one Foyer have gone on to full-time training or permanent work.

During 1997 over 1,000 residents and non-residents benefited from the facilities offered by one Foyer - The Gateway Project - in South London, with over 70 per cent of residents having found jobs, or entered full-time education or training.

With the support of Diageo, the Foyer Federation has gained a reputation for practical innovation and effective partnership. The Federation has also enabled Diageo employees to work in structured volunteering programmes, with volunteers occupying a place on the main board and many other employees offering their skills and work experience to specific projects run by the Foyer Federation.

6.3 British Telecommunications plc

British Telecommunications (BT) is one of the world's leading suppliers of fixed and mobile communications services. It is a founder member of the PerCent Club and its Community Partnership Programme in 1997/98 totalled more than £15 million (in cash and kind). Activities under the programme include helping people in need and people with disabilities, support for environment campaigns, arts sponsorships and providing partnerships in regeneration projects to create new employment opportunities in areas of economic deprivation.

For some time BT has been supporting an economic regeneration project in Northern Ireland called EDITRAIN. BT has invested £100,000 over three years in this initiative which was set up to encourage companies in Northern Ireland to adopt electronic trading services.

The project trains people in electronic skills to National Vocational Qualification (NVQ) standards. Once trained these people are offered help and support in finding work with local companies. The aim is to encourage those who have participated in the programme to contribute directly to the success of small enterprises in the area by improving their IT capabilities.

Since November 1994, 349 unemployed people have been on the EDITRAIN programme of which 280 completed their course. Of these, 132 achieved level 2 NVQs and 39 went on to achieve a level 3 NVQ. More importantly, 116 have secured employment and 36 entered further education.

Currently, EDITRAIN is providing employment opportunities for 50 local people each year. Of these jobs, 20 per cent are being reserved for people with disabilities.

As well as providing real community benefits by enhancing employment opportunities, the programme allows BT to work in partnership with other organizations including the local government authorities and enterprise agencies. In addition, involvement in EDITRAIN provides important openings for BT's employees to become actively involved in the local community.

6.4 John Laing plc

John Laing is an international company involved in construction, the building of homes for sale, property development and investment in infrastructure. Based in the United Kingdom, it operates in Europe, the Middle East, America and South East Asia.

Laing has a long-standing commitment to contribute to the wider community and takes an active role in community affairs. Its support is aimed at providing opportunities for the disadvantaged to realise their goals.

As part of the company's work encouraging regeneration in urban estates, Laing has supported the Thanet Childcare and Training Partnership - this aims to create an opportunity for unemployed parents to undertake training and hence employment by the provision of low cost, high quality childcare facilities.

The original idea for the partnership came from a group comprising:

• Unemployed parents on benefit.
• The Children's Society (a charity).
• The Thanet College of Further Education.

Their original request was for Laing to provide some second-hand "portacabins" (semi-permanent building units often used as office space on construction sites). Rather than do this, Laing agreed to enter the Partnership to help design and build new facilities.

Laing could have managed the design and construction of the building, but the company preferred to pass on the relevant skills to the Partnership. It carried out the site survey and structural design at cost. Having set the example, Laing was used as a catalyst to persuade more than twenty other suppliers to either donate materials or, at least, provide them at cost. Laing also provided financial support of £25,000, which enabled the Partnership to leverage in additional funds to a total of £150,000.

Laing suggested, at the design stage, that the building could be designed so that it could be built by unskilled labour. This idea was taken up by the Partnership to maximize the benefits to the community. As a result, twelve trainees were taken on not only to build the structure but also to join training courses that the College was running.

To date the Partnership has achieved:

• The creation of a new, low-energy childcare facility for 30 children.
• Nursery places available for those on low wages and those receiving training.
• An after-school club and holiday club have both been opened.
• Fund raising of over £150,000.
• Over 100 children have attended during the first year enabling their parents to access training or the job market.
• The creation of 9.5 full-time equivalent, well paid jobs.

6.5 Focus

The final case study deals not with a corporate organization directly, but with a charity that works with people from diverse groups across society. Its aim is to inspire people and develop their potential. FOCUS has been providing training, development and learning opportunities for a broad range of people for more than ten years.

One major part of the charity's work is the InterAction programme which brings together:

• Managers from the business community.
• Young people at risk who are experiencing social exclusion.
• Adults with physical or learning disabilities.
• Volunteers working as either team members or as mentors to individuals.

A key element of the InterAction programme is a week-long residential project that brings together all participants in teams of 12-15 people to tackle a range of challenges. Typically these include drama, sports, craft-based and construction activities. For the young people and disabled adults this residential project is part of a longer-term programme designed to increase their self-esteem, and develop skills to make the most of future education, training and employment opportunities.

For the business delegates, the residential project forms part of the "Human Side of Management" development course. During the event they are supported by tutors from a management training organization who help them develop their management and leadership skills - including facilitation and coaching skills - in a way that supports the FOCUS objectives. Delegates have a 2 or 3 hour tutorial each day to process their learning and link the lessons back to their workplace.

The aim of the programme is to develop in all those involved:

• Greater self-confidence and increased responsibility.
• Skills valued by employers such as communication and team working.
• Increased awareness of the needs of others.

During 1998, FOCUS worked with 450 volunteers to run programmes and activities that involved over 1,500 young people and disabled adults. Approximately 200 business delegates were involved from companies including BT, Glaxo Wellcome and IBM.

While specific outcomes of this initiative are hard to quantify, the programme is clearly tackling some of the United Kingdom's most pressing social issues - ensuring social inclusion, encouraging active citizenship, increasing employability and developing lifelong learning opportunities. For the business delegates involved, the programme offers a chance to contribute in a direct and meaningful way to the community, while participating in a powerful development exercise.

7. Lessons from the case studies

Having highlighted how five different organizations are successfully creating employment opportunities - both by developing their own employees and providing assistance to those currently outside the workforce - this section attempts to draw out some generic lessons that might be used to define best practice in this area.

It is clear that there is a wide range of different voluntary initiatives that companies can adopt. This paper has focussed largely on those activities that actively engage employees in community involvement activities. Many other examples could have been provided of companies working with voluntary sector and statutory organizations to enhance economic regeneration, improve the capacity of small businesses, and increase levels of entrepreneurship in the local economy.

No matter which route a company might choose to engage in this process of creating and enhancing employment opportunities, there are a number of key issues that should be borne in mind by any employer wishing to take action. Some of the most obvious lessons are as follows.

First, CCI is not simply about good PR or improving the company image. The purpose must be to improve the lives of those people the company touches. Clearly, in doing so, the business will benefit over the long term from a good reputation as being a strong member of the community - but this will only come from a sustained effort in meaningful activities that benefit others.

Second, CCI is not about altruism or philanthropy. The brief examples cited in this paper show what companies can do when they approach community projects with the same degree of professionalism, creativity and commitment as any other aspect of their core business. Companies active in community involvement do not devote more resources than they can afford, nor do they sacrifice the bottom line in engaging in these activities.

Third, building trust and credibility is central to leading-edge companies:

• Trust from employees that it is a good company to work for.
• Trust from customers that it is a caring organization.
• Trust from the community that this company is a good neighbour who cares about and responds to local issues.

Beyond these overarching principles, what are the lessons to be learned from the specific case studies and company examples discussed in this paper? The following paragraphs attempt to answer this question.

7.1 CCI is about meeting business objectives

Community involvement must be about mainstream business concerns. The examples highlighted in this paper demonstrate how leading-edge companies are involved in initiatives that tie in closely to the activities of the business (e.g. Laing involved in a building project, BT helping to improve IT and communication skills).

Any business wanting to develop a successful CCI programme must understand how becoming involved in community projects will complement and support the strategic objectives of the business.

7.2 CCI is a professional management function

Community involvement must be treated as any other management activity. It is not a "feel good" factor that can be done on an ad hoc basis. The potential benefits arising from community involvement will be lost if it is seen as an unimportant add-on to the business.

A company taking action in this area needs to demonstrate a strong and firm commitment. This implies planning, managing, executing and evaluating community involvement activities as for any other aspect of the business.

7.3 CCI exploits a wide range of corporate resources

The third key lesson is that community involvement is not simply about the occasional charitable donation. It is about using all the resources available to a company. Cash giving is important, but the key to an effective CCI programme is about harnessing the enthusiasm, skills and abilities of employees - offering creative opportunities to support staff and encouraging them to become involved.

It is also important to consider how a company might use all the resources at its disposal. This includes the creative use of such assets as: buildings; vehicles or equipment; surplus goods and merchandise; redundant computers and office furniture; or any other items that might be of value to local charities or community groups.

7.4 CCI must be communicated

Communication is vital to success in this area to ensure that a company's key stakeholders are aware of what the organization is doing. The days of unsung corporate philanthropy are long gone. People now expect business to be active in their local communities and are receptive to hearing what is going on. Companies must respond by thinking carefully about target audiences, key messages, and how best to get the message across.

Most importantly, leading-edge companies are ensuring that their own employees have "got the message" by including briefings and up-dates on their community involvement activities in all their regular communication channels.

7.5 CCI is about partnership

Finally, perhaps the most important message to emerge from the case studies included in this paper is that community involvement is not an activity that needs to be undertaken alone. Rather, partnership is at the heart of working in the community. There are two important aspects to this notion of partnership.

The first involves companies looking for opportunities for leverage in their CCI activities. This means working with others - employees, customers, other businesses, local government bodies, other statutory authorities, and of course local charities themselves.

The second element of partnership is that companies must ensure their CCI activities are able to build the capacity of their community partners. As CCI moves away from the dependency culture implied by cash donations, so companies are looking to build mutually beneficial relationships with voluntary sector organizations that develop the skills of people in both the company and the community group with which it is working.

8. Public policy implications

This final section considers, in very broad terms, some of the potential implications for public policy arising from the issues raised in this paper. Clearly, the relatively restricted scope of the discussion presented above does not allow for a full analysis of how government can work with business to augment voluntary corporate contributions to enhance employment opportunities. However, several of the themes raised in this paper do point towards a number of broad conclusions that can be drawn.

8.1 Business can contribute to public policy

The first conclusion is that business does have a legitimate role to play in contributing towards public policy development. The current business environment is creating new definitions of what it is to be a socially responsible company or a good corporate citizen. The Prince of Wales Business Leaders Forum (Nelson, 1996) has offered the following definition:

A company which responsibly manages its economic, social and environmental impacts in each of these three areas aiming to minimize negative impacts and optimize positive ones, and builds accountable and transparent relationships with key stakeholder groups.

This new model is encapsulated in the diagram overleaf (Tuffrey, 1998).

This concept of managing economic, social and environment impacts is at the heart of sustainable development for business. While the model covers both core business activity and CCI, it also argues that business has an important role to play in the development of public policy. So, for example, companies can help central and local governments to develop appropriate fiscal, regulatory and institutional structures aimed at:

• Tackling obstacles to responsible private sector investment.
• Contributing to education, training, local economic development, employment and environmental policies and frameworks.

Secondments of staff, both full-time and part-time, is an interesting development in this respect - harnessing the skills and experience of senior business leaders to contribute to and facilitate the development of public policy. Two important examples, which illustrate this trend, are:

• The Taskforce on Tax and Benefit which has the remit to "streamline and modernize the system to fulfil the objectives of promoting work incentives, reducing poverty and welfare dependency and strengthen community and family life". This review was led by Martin Taylor (1997), Chief Executive of Barclays Bank.
• The Welfare to Work Task Force is chaired by Sir Peter Davies, Chairman of the Prudential and includes many senior company representatives, including three company chairmen.

8.2 Education for employment is an issue for business and government

There have been various attempts to calculate the potential costs to United Kingdom business of the deficiencies in the national education and training system. One report produced by Ernst and Young suggested that UK companies spend more than £10 billion in correcting the imperfections of state education.

Companies realized long ago that training and development is a prerequisite for developing the workforce that they need to achieve success. They are now realizing that investing in the skills, competencies and abilities of potential employees can also pay real dividends. If companies do not get involved with business-education links, or offer development opportunities for those about to enter the workforce, they will inevitably face higher recruitment and training costs.

Faced with this reality, companies are increasingly willing to direct their mainstream CCI activities towards initiatives that enhance the employment potential of employees and prospective workers.

The national government has not been slow to recognize the benefits of public-private partnerships in this area. The New Deal for Young People is a prime example of how the United Kingdom government is seeking to include business in the development of solutions to long-term unemployment. This partnership involving government, trade unions and business working together delivers three benefits:

• It enables the learning, knowledge and expertise gained from the initiative to be widely spread.
• Having different sectors involved, and hence committed, increases the chances of successful outcomes in getting young people from welfare into work.
• The partnership approach to the New Deal makes for better policy delivery than either the public sector acting alone, or indeed contracting out the service to a private sector organization.

8.3 Spreading the message

The final lesson in thinking about the public policy debate must be to ensure that more is done to replicate the types of initiatives highlighted in this paper - especially across the broader spectrum of business.

The Commission on the Future of the Voluntary Sector noted that CCI appears to be predominantly a large company phenomenon. An important role for government could be promoting CCI to small and medium-sized companies. As the Commission observed, critical to success in this respect is demonstrating the business benefits to these smaller companies.

One exciting development in this field is the launch of the Brighton Community Mark, which is a quality-based kite-mark, which will be awarded to companies who fulfill certain criteria for their community involvement. The local council and BT have agreed that, all other things being equal, when companies tender for business with them they will award the contract to organizations holding the Community Mark.

Business in the Community, who have been central to the development of this initiative, hope to extend the scheme across the country. Support for this initiative by both local and central government could provide a real business case for many small and medium-sized companies to become involved in local community investment projects, thereby improving employment opportunities for all.

9. References

Business in the Community. 1999. "The role of employers in active communities", London.

Business in the Community. 1999. "The PerCent Club 1999 Benchmarking Report", London.

Business Week. 12 October. 1998. "A Site for Soreheads".

Directory of Social Change. 1998. "A guide to company giving", London.

Esther Dyson. 1998. "A Design for Living in the Digital Age", Broadway Books, New York.

The Economist.1998. "The World in 1997", London.

Crawford S. Giles. 1992. "Beyond Charitable Giving: Board Policy on Community Involvement", Bain & Company, London.

David Grayson. 1994. "What they should teach you at Durham University Business School", Durham University Business School, Durham.

1997. "Report of the Taskforce on Tax and Benefit", HMSO, London.

Peter Hunt. 1995. Presentation to the Managing Corporate Community Investment programme, Ashridge.

London Benchmarking Group and Corporate Citizenship International. 1997. "Companies in communities: Getting the Measure", London.

MORI.1997."1997 MORI corporate social responsibility study", London.

MORI.1998. "1998 MORI corporate social responsibility study", London.

MORI.1997. "1997 MORI corporate social responsibility study", London.

MORI.1996. "1996 MORI corporate social responsibility study", London.

MORI.1998. "1998 MORI corporate social responsibility study", London.

MORI.1997. "1997 MORI corporate social responsibility study", London.

MORI.1996. "1996 MORI Captains of Industry Survey", London.

Jane Nelson. 1996. "Business as partners in development: Creating wealth for countries, companies and communities" Prince of Wales Business Leaders Forum, London.

The Observer. 1999. "Observer Guide to the Internet", London.

PIRC Ltd.1998. "Environmental and social reporting: a survey of current practice at FTSE 350 companies" London.

PIRC Ltd. 1998. "Environmental and social reporting: a survey of current practice at FTSE 350 companies, London.

Mike Tuffrey. 1998. Valuing Employee Community Involvement Corporate, Citizenship International, London.

World Watch Institute.1999. "State of the world 1999", Washington.

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Endnote 1:

These imperatives were identified in on-going research undertaken by Ashridge for The Copenhagen Centre, "The role of central government in developing new social partnerships - A comparative European study" (forthcoming).