Bringing Purpose to Community Investment: Overcoming Hurdles to Purpose-Alignment
By Dr. Emily Heath
We just returned from a trip to North America where the Head of Community at a major financial institution was sharing their frustration at the disjuncture between their corporate purpose and community investment. While the company had a freshly-minted purpose statement that was both directive and compelling, she was being asked to continue investing in a legacy community investment portfolio that, though worthy, was not in any way aligned to the purpose or strategy of the business.
In the context of our recent Karrikins Brief, Purpose-Aligned Leadership: From Purpose-Driven to Driving Purpose, a question has been coming up a lot: “how should purpose play out in community investment (CI) and CSR?”
This question will resonate with many of our clients and partners as much as it does with us – after all, we have for many years worked to maximise the business value and social impact of community investment.
Our view is that CSR broadly, and community investment specifically, should be a living, breathing manifestation of the purpose of your business. There are a few reasons for this:
- Unlike other parts of the business that tend to come under intense, reporting-cycle based pressure to produce immediate results, CI often can take a longer view and be at least a little insulated from these pressures
- CI is normally the place with the most obvious connection to social good, so it tends to be easier to manifest purpose in a way that is emotionally compelling
- Purpose is the answer to the question: “Over and above making money, why does our organisation exist?” The answer to this question is typically an aspiration about the impact the company wants to have on the world, and CI is directly about the same thing. So, the CI department is often filled with people with the passion, expertise, and savvy to bring purpose to life in a truly meaningful way.
But despite the natural fit between CI and purpose, in many companies we’ve spoken to CI is not particularly aligned to the purpose of the company.
We see three common causes of this problem.
Leaders Lack Strategic Agreement
We frequently encounter organizations with a lack of agreement (and often alignment), at a strategic level, about the value that CI is trying to create. For instance, we recently facilitated a conversation between senior executives at a large property firm and the CEO, CFO, Head of Customer and Head of HR (who shared responsibility for community investment) had never even articulated, let alone agreed, on precisely what they were hoping to achieve through their CI, or how CI would support their enterprise strategy. With such a lack of clarity, alignment will be nearly impossible
Purpose-Alignment is Confused with Simply ‘Doing Good’
We have noticed both business and CI leaders who hold the impression that if CI is already ‘doing good’ and ‘making a difference’, that alone is enough. In fact, in some places, there appears to be a genuine confusion that purpose-alignment and ‘doing good’ are the same thing. The result of this is that many companies create an independent CI agenda, complete with its own ‘mini-purpose’ that is not the same as the purpose of the business. This agenda often amounts to investment in specific social issues, charities or causes that do not further the company’s purpose or drive its strategy.
This is not to say that such CI portfolios lack any form of strategy (for instance, they could entail a highly strategic approach to solving a social problem), but rather that their strategies are not aligned to the business strategy.
Purpose is Being Outsourced
Finally, it is still common to find organisations who effectively outsource the job of CI alignment to third-party community organisations. That is, they largely build their CI portfolios by selecting charity partners whose activities are broadly thematically aligned to the company’s purpose in the hope that that will ‘count’ as purpose alignment. In a well-intentioned attempt to manifest their company’s purpose they give their partners cash, rather than creating co-designed, co-owned or curated activities that directly drive strategy and manifest purpose.
The shame in all these cases is that companies lose a valuable asset that can help drive purpose, and CI sacrifices its chance to elevate its strategic criticality to the business.
How Can Leaders Bring Purpose to Life Through Community Investment?
The path to purpose alignment can be a challenging one, but also represents an exciting opportunity. Leaders in CI and CSR who bring purpose to life through their community investments have the chance to make a genuine and powerful difference in the community, while also delivering real returns for their companies.
Take a moment and reflect on your own community investment strategy and portfolio.
- Are they aligned to your company’s purpose in a meaningful way?
- Do they represent a commitment to purpose-alignment that goes beyond cash grants and donations, to co-design of carefully designed programs that bring your purpose to live through your community investments?
This is part of our Karrikins Brief series on Purpose-Alingment. Tap into the power of aligning operations, strategy, and culture to a compelling and directive purpose.