5 Key Resources for Effective Investment in Communities
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The relationship between companies and communities is complex. Increasingly, companies are starting to recognise that their long-term business success relies on the health and wellbeing of the communities where they operate. As a result, many companies choose to invest in their local communities, both as a way of demonstrating their commitment to sustainability and to manage community-related risk. This blog post highlights five resources to help your company make meaningful and strategic contributions in the communities where you operate.
How do leading companies invest in communities?
Leading companies recognise the importance of investing in communities as a strategic tool that helps them foster positive relationships and support the resilience of communities where they operate. These companies tend to avoid transactional contributions. Instead, they tend to focus on relationships, and they work closely with communities and local organisations to co-create solutions and allocate resources to enable communities to benefit in a self-defined way. And leading companies measure success with metrics that are useful both to the company and to communities.
Leading companies’ investments in communities are not siloed: these organisations often amplify employee efforts to support community health and wellness and they create opportunities for skills-based volunteering and secondments. These organisations also enable participation beyond their company, and try to involve their value chain, sector, and other local organisations and governments in multi-stakeholder initiatives to maximize positive health and wellness outcomes.
How can your organisation invest in local communities?
If you have been thinking about how your company could make more meaningful and strategic investments in local communities, here are some helpful ideas and resources to consider.
Understand the interconnectedness between your organization and communities. Companies are increasingly expected to account for their impact on community resilience. What resilience looks like is different in each community, based on its unique local context. Our guide on Understanding Community Resilience helps your company understand the meaning of community resilience and how communities are starting to understand their own resilience, so that your company can begin to explore its own impacts and how to contribute to local community resilience.
Measure your impacts on people and communities. When companies lack understanding of their impacts and their dependence on people and communities, they may underperform, miss opportunities, or expose themselves to business risk. The Social & Human Capital Protocol provides a framework for companies to understand their impacts on social and human capital as well as their dependence on these. The Protocol can help your company to measure and value social and human capital and generate relevant information for organizational decision-making, including on strategic investments in local communities.
Build lasting relationships. Investing in communities, when done well, is a highly collaborative undertaking that requires frequent and ongoing engagement with communities. This engagement should not be a stand-alone activity, but part of your company’s broader community engagement approach. While designed for the resource sector, the Community Engagement – A Getting Started Toolkit for Exploration and Development Companies is relevant for other sectors too and offers tools that can help your company to engage effectively and build lasting community relationships.
Foster strategic partnerships. Strengthening community resilience is a complex undertaking, because of the many interrelated systems and role-players involved. As such, establishing cross-sectoral partnerships with local actors can help your company to identify relevant opportunities to make tangible contributions and support effective delivery and monitoring of outcomes. Our guide on Partnering for Community Resilience: South African Case Studies highlights key lessons from the experiences of five companies seeking to contribute to community resilience.
Recognise the complexity and unpredictability of social progress. As a complex, multifaceted undertaking, social change does not usually follow a predictable path. Emergent strategy is an approach that responds to the unpredictability of social and systems change. Strategic Philanthropy for a Complex World helps companies and other funders of social change to understand emergent strategy, when it is more useful than predictive strategy, and how to adopt a more emergent approach to investing in communities.
If you aren’t already familiar with the community investment guidance from B4SI (formerly the London Benchmarking Group) and International Finance Corporation, be sure to visit those as well. Though originally developed some time ago, they still offer a comprehensive approach to strategic investment in communities (IFC) and tracking and measuring impacts (B4SI). Visit these Invest in Communities resources and others if you’re interested in investing in your community, or want to learn more about how to do it well.