CHAPTER 3: RESEARCH METHODOLOGY
3.4 THE TARGET POPULATION
3.4.1 Sampling
The practice of observing a small sub-section of a category, and inferring conclusions regarding a broader category of people or things, is a central component of social science research (Henning, van Rensburg and Smit, 2004, p.133).
The study investigated CSI practices across sectors, but specifically focused on the top 30 companies, classified as such by Trialogue (2012). It sampled 30 top companies and earmarked the leaders for data gathering through literature search, in-depth interviews and structured questionnaires.
The study employed stratified sampling in order to ensure industry sectors have equal opportunities to be respondents in the study. Respondents were chosen from various sub-sectors such as financial services, mining, manufacturing, retail and wholesale and state-owned enterprises.
Stratified sampling was used to establish a greater degree of representativeness in situations where populations consisted of sub-groups or strata. To ensure that a sample adequately represented relevant strata, the sample was not drawn randomly or systematically from the population or sampling frame as whole, but from each stratus independently (Henning, van Rensburg and Smit, 2004, p.139).
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The list of respondents was drawn from the CSI expenditure per company, a list that is published annually in the CSI Handbook by Trialogue. Trialogue is viewed as an authority on CSI research in the country.
3.5 DATA ANALYSIS TOOLS
Chelimsky (1989) defines content analysis as ‘a set of procedures for collecting and organising information in a standardised format that allows analysts to make inferences about the characteristics and meaning of written and other recorded material’.
Ryan & Bernard (2003) argue that analysing text involves several tasks:
Discovering themes and subthemes;
Winnowing themes to a manageable few (namely, deciding which themes are important in any project);
Building hierarchies of themes or code books;
Linking themes into theoreticalmodels.
This study used content analysis during the data coding and analysis.
3.6 ETHICAL CONSIDERATIONS
It is often mistakenly assumed that qualitative research is exempt from ethical consideration or review. Arguments presented are that the method is conversational and that data analysis attempts to preserve the integrity of the data collected. However, participants in qualitative research are entitled to the same protection and respect as those in quantitative research (Henning, van Rensburg and Smit, 2004, p.73).
Interviews were conducted with the consent of the participants, and since the information is public there was no need for a confidentiality contract to be drawn up and signed. Participants
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were also taken through the data analysis process to ensure that conclusions arrived at the by the study could easily be supported by facts.
Moral and ethical issues were considered before, during and after the research, as the study was based on the perceptions and experiences of human beings.
Respondents were informed that participation in this research is voluntary. Respondents were assured that accepting or refusing to participate in this study would not in any way affect their personal lives, family or work life. Fortunately, the target population was relatively educated and could understand the importance of research, and as the information is contained in the CSI Handbook, it is public knowledge. Respondents were informed that they had a right not to reveal information with which they felt uncomfortable.
3.7 LIMITATIONS OF THE STUDY
The major limitation of the study was that it did not canvas the views of the beneficiaries of CSI and civil society organisations. This is a glaring omission in that the nature, scope and value-add of CSI in the study may not be influenced by the intended beneficiaries.
Secondly, the views of organised business and key Government Officials were not canvassed.
These stakeholders play a critical role in shaping both the nature and quantum of corporate social investment in South Africa.
Thirdly, the qualitative nature of the study did not lend itself to generalisation. Therefore, the findings had to be understood and interpreted within this context.
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Finally, the size of the sample may constitute a limitation as the results cannot be generalised.
An ideal situation would have been the extension of the sample to the top 100 companies listed in the CSI Handbook. Unfortunately, this was beyond the scope of the research study.
3.8 CONCLUSION
The qualitative nature of the study does not lend itself to generalisation, and therefore the findings have to be understood and interpreted within this context. Finally, the size of the sample may constitute a limitation in respect of authoritative findings on the matter. Ideally, one should have extended the scope to the top 100 companies listed in the CSI Handbook.
Unfortunately, this is beyond the scope of the research study.
CHAPTER FOUR: THE RESULTS
4.1 INTRODUCTION
This chapter presents, discusses and analyses the results of the administered questionnaires and in-depth interviews based on the summary of the data received from all respondents.
The results are presented in the form of tables. Broadly, it will revisit the research questions and analyse the data based on the responses and then synthesise the findings in the form of a summary.
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This chapter will also seek to determine CSI spending and CSI distribution by selected companies in the Eastern Cape, and address some of the themes that were explored through the questionnaires and interviews.
4.2 PROFILE OF RESPONDENTS
The demographic profile of the respondents is represented in the diagram below. The study intends to draw responses from different sub-sectors of the business sector.
Figure 3: Profile of respondents
Research study questionnaires were distributed to 50 respondents; there were 14 responses.
All 14 respondents are managers or specialists with the sole responsibility of implementing CSI for their respective companies. As stated above, responses were received from mining, banking, telecommunications, retail and manufacturing and State-owned enterprises.
A few respondents declined to participate in the study, citing company positions which prohibited the sharing of company-specific information. Other companies cited that their CSI spending and distribution is driven at national level, and as such it is not province-specific, thus making it difficult for them to take part in the study.
22%
21%
14%
29%
14%
Respondents
Mining Telecommunication
Banking Retail and Manufacturing State Owned Enteprise
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One of the respondents cited a unique approach by his company, which assists communities through project management instead of injecting financial assistance. The example will be discussed in detail at a later stage.
Descriptive statistics of all the respondents
Table 1: Statistics of all respondents
CSI Managers CSI Specialists CSI Administrator
6 7 1
4.3 CSI SPENDING IN EASTERN CAPE
Question 1: How much have selected companies spent for CSI in the Eastern Cape?
The 14 respondents distributed R71.8 million to the Eastern Cape. The largest single donor was Petro SA, with a contribution of R25 million. The figure was influenced by two infrastructural programmes: the Integrated Energy Centre in Mbizana and the Gangatha Primary School in Ntlabane (near Willowvale in the Eastern Cape).
CSI spending in the Eastern Cape should be looked at against the amount spent on CSI in 2012, which is estimated at R6.9 billion. This amount represents a nominal growth of 11.3% over the previous year, or 5.4% if adjusted for inflation.
Below is the synopsis of major CSI funded projects in the Eastern Cape in 2012. The criteria beyond the synopsis is to show projects that received more than a R1 million cash injection through CSI.
Table 2: Synopsis of major CSI funding in the Eastern Cape in 2012
Project Funding
Gangatha Primary School in Ntlabane, near Willowvale in the Eastern Cape R13 million
Integrated Energy Centre, Mbizana R11 million
Adopt a School Programme R11 million
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Rhodes University Library extension project R5m
Siyakhana Health Trust R2m
Making a Difference Campaign (MADC) R1 million
It is worth noting that beneficiaries for the ‘flagship projects’ are not non-profit organisations, but communities and institutions of higher learning. One respondent attributed this trend to lack of capacity amongst NGOs and the need to ensure that communities are major beneficiaries of their funding.
Three respondents did not fill out questionnaires, but sent e-mails stating that they do not fund projects in the Eastern Cape as they do not have business footprints in that Province.
Ironically, one of the respondents is a mining company which draws its labour force from the Eastern Cape.
Of the respondents, 13 stated that they fund national projects which also benefit the Province. One of the respondents cited the Phelophepha Train as example and stated that it brings health and hope to thousands of rural South Africans in need of access to health care facilities. The service is free of charge and the Eastern Cape also benefits from this service.
Conclusion to Question 1:
Companies that responded spent R71.8 million in Eastern Cape. This should be compared to R6.8 billion spent nationally in 2012. This indicates that the Eastern Cape receives a fair share of CSI spending, and this is especially true if it is looked at against the fact that only 14 companies responded to the questionnaire.
4.4 URBAN vs. RURAL DISTRIBUTION OF CSI SPENDING
Question 2: Are companies sensitive to the urban and rural divide in their CSI spending and distribution in Eastern Cape?
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It is also worth noting that companies spend large amounts of money in rural areas of the Eastern Cape, as evidenced by the Gangatha Primary School (in Ntlabane, near Willowvale) and the Integrated Energy Centre, (Mbizana), both in the Eastern Cape. Both projects are underpinned by infrastructure development, and upon further scrutiny, it transpires that both projects fall under the former Transkei area.
Respondents reported that rationale behind the former Transkei area being favoured was prevalent poverty and underdevelopment in the area. Another reason was the influence of former President, Nelson Mandela, who used to lobby CEOs of companies to invest in impoverished areas – especially the former Transkei area. In anticipation of the former President’s well-documented lobbying, CEOs instructed their companies to include the former Transkei area as one of their geographic focus areas and budget for this accordingly.
Importance of initiatives geared towards rural development can never be over-emphasised, but they need to be balanced with investment in urban areas.
It is also worth noting that recipients of funding in rural areas are communities rather than organisations. Petro SA partnered with the Department of Minerals and Energy for the Integrated Energy Centre in Mbizana project, whilst it partnered with Department of Education for the Gangatha Primary School project.
Universities in rural areas in the Eastern Cape (for example, the University of Fort Hare and Walter Sisulu University) received the least funding from companies in the year under review.
Conclusion to Question 2:
Of the R71.8 million injected into the Province through CSI, R29 million was invested in projects in rural areas. This constitutes 40% of CSI spending which has been channeled towards rural areas and towns.
4.5 DONATION ‘IN KIND’ AND STAFF VOLUNTEERISM
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Question 3: Apart from funding, what other kind of assistance does your company offer?
Eleven respondents indicated that their companies also give out donations ‘in kind’ which are not quantified in monetary terms. Donations ‘in kind’ are always aligned to a company’s business operations; for example, the Transnet Foundation distributes containers to organisations for various reasons, and two telecommunication companies stated that they donate IT equipment to deserving organisations and schools.
Only two respondents stated that they have disaster relief or soul funding set aside for 2012.
Both respondents agreed that they did not distribute funding for this purpose in the Eastern Cape.
Nelson Mandela Day gives impetus to staff volunteerism, as it mobilises staff members to invest their time for the betterment of society. All 14 respondents admitted that they participated in Mandela Day, but only 11 had held Mandela Day activities in the Eastern Cape.
Six respondents claimed that they had institutionalised staff volunteerism before Mandela Day came into being, which they achieved by allocating to all staff members one day of paid leave in return for community involvement.
Only two respondents chose sites in rural areas near Mthatha, specifically Mvezo and Qunu;
Nelson Mandela has strong connections with these areas. Both respondents indicated that they received invitations from political leadership of the area and were also lobbied by Nelson Mandela’s relatives to roll out their Nelson Mandela Day activities in Mvezo and Qunu. Both were adamant that publicity was not a consideration when they agreed to roll out their Nelson Mandela Day celebrations in Qunu and Mvezo, but they welcomed the publicity which was generated by the choice of sites for their activities.
When asked about the rationale behind the choice of early childhood development centres for Nelson Mandela Day, the SAB CSI Coordinator named Mandela’s love for children.
Donations ‘in kind’, as evidenced by Transnet Foundation’s distribution of containers to deserving projects, have huge potential in the fight against poverty and other social ills. This
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is especially true for food manufacturing companies who can partner with government in the distribution of food parcels to deserving communities.
Conclusion to question 3:
Seven respondents participated in Nelson Mandela Day and 5 of the respondents chose early childhood development centres in urban areas as beneficiaries. All centres chosen for Nelson Mandela Day are in urban areas: namely, Mdantsane and Duncan Village in East London, Motherwell and Walmer in Port Elizabeth and KwaNobuhle in Uitenhage. Respondents attributed this skewed distribution of CSI to the logistical nightmare of activating staff volunteerism programmes in rural areas.
4.6 CSI DISTRIBUTION IN EASTERN CAPE
Question 4: How have companies distributed their CSI budgets across programme focus areas in the Eastern Cape?
The table below attempts to graphically depict how CSI spending was distributed across different programme focus areas. The table shows that education and health received the highest allocation of CSI spending in the Eastern Cape. Community development, information communication technology and the environment were the least supported programme focus areas.
35 Figure 4: CSI Distribution
These findings are consistent with the Trialogue (2012), which states that corporate groups directed 70% of the total funding into education, social and community development and health. Health and entrepreneurship also received a significant portion of CSI distribution (Trialogue, 2013, p.36).
Companies also directed funding towards universities in the Eastern Cape. Nelson Mandela Metropolitan University, followed by Rhodes University and Fort Hare received the highest amount of funds allocation in 2012.
Conclusion to Question 4
The results indicate that in terms of CSI distribution, 100% of companies regard education as the best investment they can make to the society.
4.7 CSI DISTRIBUTION IN EDUCATION
Question 5: Which specific educational initiatives does your company support?
Education remains the most supported programme focus area through CSI spending. Twelve respondents indicated that they support education through their CSI distribution, and this is in line with national findings of the Trialogue study for 2012.
Education is a broad focus with different sub–focus areas. Respondents were requested to specify their CSI distribution within education. Main sub-sectors that were identified were higher education, maths and science development, early childhood development and school infrastructure.
Conclusion to Question 5
Within education, 78% of respondents supported maths and science development, 57%
supported higher education, 42% early childhood development and only 14% support school infrastructure.
36 Table3: Distribution of respondents in the education sector
Education focus area No. of respondents
Maths and science development 11
Higher education 8
Early childhood development 6
School infrastructure 2
Figure 5: Number of respondents in various education sectors
4.8 ACCESS TO FUNDING
Question 6: How do beneficiaries access funding?
Nine respondents stated that organisations can access funding by submitting applications to company offices. Information to that effect is published on company websites, and at times a Call for Proposals is advertised in the media.
Five respondents stated that they proactively identify projects that are aligned to their CSI policy. Two respondents admitted that they sometimes respond to articles published on mainstream media to identify possible beneficiaries. One respondent stated that they
0 2 4 6 8 10 12
Number of Respondents
No of Respondents
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appointed CSI ambassadors amongst their staff members in order to identify community projects worthy of investment.
Amplats was an exception to the rule, as they stated that they conduct road shows working with Government partners – namely, provincial and local Government – in order to encourage applications for CSI funding.
Most CSI units are understaffed as they have a staff complement of only three people, and as a result they don’t have time to go through many proposals. All respondents stated that their executives have little influence, if any, on their CSI spending and distribution decisions.
Conclusion to question 6:
Of the respondents, 64% stated that applicants accessed their funding by submitting applications to the company office, accessing websites or calling for proposals through popular media outlets. A total of 35% of the respondents proactively identified their own projects for CSI funding purposes. One company conducted road shows. This indicates that applicants do not have an equal chance of accessing funding. There should be a uniform and standardised way for companies to deal with applications in order to ensure that everyone has an equal chance of accessing funding.
4.9 RETHINKING CSI FUNDING: GM FOUNDATION’S CSI APPROACH
Question 7: Are there any new and innovative CSI approaches that have emerged recently?
This section seeks to present findings about innovative CSI approaches that have emerged recently. Only one company responded positively to this question and 13 other companies stated that their CSI programmes revolve around grants, staff volunteering and donations ‘in kind’. The General Motors (GM) South Africa Foundation presents a unique approach to CSI (referred to by GM South Africa Foundation as Corporate Social Action (CSA).
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For nearly 30 years, the approach to CSI has essentially stayed the same: a company evaluates requests for financial support and then provides grants. After all these years, is it not time to reassess CSI? Could there possibly be a more developmental funding route than signing cheques? Has the GM South Africa Foundation produced a better approach?
In 1994, the Delta Motor Corporation decided to search for a way to increase the company's impact on development and established the Delta Foundation, which has recently changed its name to the GM South Africa Foundation. The Foundation has been experimenting with a totally new and highly innovative approach to CSI over the past ten years, one which it calls CSA.
How does CSA differ from CSI? The first phase in the CSA process is to operate as a project management agency rather than a ‘grant-maker’. The projects which the Foundation undertakes focus on poverty alleviation through education and housing, and each is structured as a pilot project to test out a totally new 'out of the box' way of addressing a crucial social problem. Project partners are actively sought to form project management teams and public sector involvement is non-negotiable.
However, CSA sets an even higher goal than replication by other agencies. As the State is the largest development agency, the Foundation feeds all its learning experiences into the South Africa's various policy-making mechanisms. There are, of course, many frustrations, particularly when persuading people to let go of outdated approaches – even if they don't actually work.
An example of ongoing but outdated behaviour is in the field of housing. The matchbox
An example of ongoing but outdated behaviour is in the field of housing. The matchbox