How to Achieve Agile Social Impact Around the World: Global Optimization
As more and more of our clients expand their markets overseas, we see a steady incremental increase in global philanthropy as well. Our observations align with industry research. Take a look at CECP’s Giving in Numbers reports over the past six years.
The 2012 edition reported that companies allocated, on average, 14% to international giving and 47% had formal international volunteer programs. As of the 2018 edition, those numbers stand at 21% and 56% respectively. These aren’t meteoric increases necessarily, rather a slow and steady trend reflecting a broader global footprint for philanthropy. Clients tell us that they understand the benefits of establishing “meaningful connections” and addressing “local needs” wherever they operate beyond U.S. borders.
It’s gets more complicated with multiple countries.
Optimizing investments on a global scale is tricky. Overall, 60% of companies that give domestically also have at least one international program. And the geographic reach? Among the 64 companies headquartered in North America that contributed to the latest Giving in Numbers report, the median number of countries on the receiving end of their generosity was ten. The countries receiving the most societal investment tended to be the larger economies in Europe, along with India and China. But the total number of recipient countries was 189 — as the report notes, that number is just four less than the total of countries in the United Nations. One enterprise-level CyberGrants customer told us the challenges “rise tenfold” with each additional country in the program.
Creating an effective global giving strategy
Many factors influence how companies choose where to give: The local presence of the company in terms of employee count and degree to which those employees are engaged; competitive situation in the market and potential for business advantage; social needs and whether the causes align with the company’s core business and capabilities; and in some cases, the country’s stability and the government’s role in providing social services.
Making decisions based on such a broad range of factors calls for understanding at both the macro and micro levels. That means aligning with corporate goals while allowing for highly variable local conditions. Most often, the broadest tasks of setting budgets for contributions and prioritizing causes reside primarily at headquarters. A survey of ACCP members found that 59% say their budget allocation and management is centralized, 18% say decentralized, and 23% use some combination of the two. But unless the organization has a robust reporting system in place for understanding and directing the dollars, the allocations are often formulaic rather than strategic. Teams typically replicate what has been done in the past, rather than make data-driven decisions that take a fresh look at needs and business priorities.
Maximizing local impact
Typical practice has been to centrally define the societal issues that the company wishes to support and the giving boundaries and leave execution to local volunteer teams. This means that regional or local offices may select the recipients, provided they align with the specified guidelines.
And by freeing the local teams to make more of the decisions, companies can often do a better job of meeting their overall business objectives, which include generating goodwill and building a local reputation. A stronger local focus can benefit the company in other ways, too. CyberGrants clients indicate such positives as attracting local talent, engaging those employees in the company’s purpose, improving customer perceptions, and deepening government relations.
Optimize globally, execute locally.
We work with global programs every day, and here’s what we are observing as best practices in organizations that do this stuff very well. They broadly invest in goodwill across their strategic geographies and give their local teams freedom to allocate 20-30% of the resources to allow for local cultural differences and support region-specific causes. That strikes an excellent balance that delivers on a global strategy while creating the right kind of flexible local impact. In other words: Agile Social Impact.
However, and this is a big however, optimizing worldwide giving programs to be both globally consistent and locally relevant requires a unique technology platform. One with a highly flexible workflow engine that enforces worldwide policies and approvals while enabling locally relevant decision making. One that integrates with other systems for accounting and other essential functions. And one that delivers access to accurate, real-time data at multiple levels for allocating, tracking and measuring impact at the required degree of detail. In combination, these capabilities give local geographies the flexibility to be most efficient and impactful. That very technology platform — integrated for grant making and employee giving — is what CyberGrants provides our clients.
No other technology provider has anywhere close to the level of global experience of CyberGrants. Please contact us for more information on implementing a global giving strategy that will help you optimize globally and execute locally.