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R10.9-billion – the spend by South African companies on CSI in 2022

Written by Editor

July 11, 2023

Positive forecasts for increased CSI spending in 2023

By Raine St.Claire

As companies’ net profit after tax (NPAT) recovers from the impact of the pandemic, CSI figures reflect a 6% increase from the R10.3-billion spent in 2021. 

The findings are published in the silver anniversary edition of The Trialogue Business in Society Handbook, which tracks CSI spending over a 25-year period.

Cathy Duff, Director at Trialogue, stated that while the NPAT of listed companies experienced significant growth this year, the comparatively smaller rise in CSI expenditure can be attributed to the time lag between NPAT and CSI spending. 

However, this suggests encouraging projections for increased CSI expenditure in 2023.

Optimism regarding social investments in the coming years is widespread among companies with 60% anticipating a rise in resources and budget allocation for CSI.

Growth observed in non-monetary contributions for social impact

Non-cash contributions by companies, such as products, services, and time experienced a notable increase. 

77% of companies reported making non-cash contributions in 2022, a significant jump from the 29% reported in 2021. 

The proportion of cashless giving as a part of total social investment increased from 13% in 2021 to 15% in 2022.

Diverse causes and geographic regions receive support

The most popular causes remained Education, with 98% of companies allocating an average of 44% of their CSI expenditure to this sector, slightly higher than the 39% from the previous year. 

Social and community development received the second-largest share (13% of expenditure), while food security and agriculture remained a high priority for companies (10% of CSI spend) due to ongoing food insecurity challenges in the country.

Duff commented that the pandemic’s impact continues to influence sector allocations, with more companies now supporting disaster relief, food security, and agriculture compared to the pre-Covid-19 period.

  • Noteworthy:
    While 62% of companies globally made grants with international impact, a considerable portion (68%) of CSI expenditure locally was dedicated to projects with a national scope. 

In contrast, compared to the 7% reported in 2021, none of the companies surveyed in 2022 provided support for international projects.

Gauteng received the highest support, with 31% of companies directing funding to projects in the province, which accounted for an average of 11% of companies’ CSI expenditure. 

KwaZulu-Natal, Mpumalanga, and the Western Cape also received considerable support. 

As social investments become more strategic, Trialogue expects to observe an increase in localised expenditure, where companies heavily invest in areas surrounding their operations, along with national expenditure aiming to have a systemic impact.

Non-profit organisations (NPOs) lead as favoured beneficiaries of CSI funding

Non-profit organisations (NPOs) remained the primary recipients of CSI funding, with 94% of companies allocating an average of 58% of their expenditure to NPOs in 2022. Despite the growing emphasis on NPO resilience, nearly half of the companies (45%) did not provide any form of capacity building to NPOs during the year. Only one-third (34%) of companies offered workshops and training programmes.

Among the preferred types of support for NPOs, flexible funding for internal capacity building ranked highest (39%), followed by pro bono support (20%) and workshops and/or training programs (15%).

Growing popularity of employee volunteer programmes (EVPs)

The popularity of employee volunteer programmes (EVPs) has increased, with 75% of companies reporting their existence in 2022, up from 71% in the previous year. 

The Covid-19 pandemic resulted in the suspension or halt of volunteer programmes for 36% of companies and 16% of NPOs in 2022. 

Additionally, the proportion of companies offering online volunteering programmes rose from 18% in 2021 to 23% in 2022, indicating a potential lasting trend.

Most companies with EVPs supported company-organised volunteering initiatives (93%), fundraising or collection drives (83%), and providing time off for volunteering during work hours (72%). Interestingly, staff volunteering events were the least desired type of initiative among NPOs, with 26% selecting them as their least preferred EVP.

The preferred types of EVPs for NPOs were employee match funding (20%), fundraising or collection drives (16%), give as you earn (13%), and pro bono support (13%).

Mainstream adoption of environmental, social, and governance (ESG) principles

The report highlights the growing mainstream integration of environmental, social, and governance (ESG) issues into overall business strategies. 

In South Africa, 69% of respondents stated that their company’s business strategy very much integrates and responds to ESG issues. 

Globally, 72% of companies reported strong integration. Furthermore, the majority of respondents in South Africa (69%) and globally (80%) anticipate full integration of ESG across all departments within the next five years.

While 76% of global companies increased their public ESG reporting in the past year, only 51% of South African companies did so, and 10% of South African companies do not have formal ESG reporting, compared to 2% globally.

Read more about social responsibility in ESG: The Future of Sustainability:

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