This research paper explores the concept of Corporate Social Responsibility (CSR) as practiced at General Motors East Africa Ltd (GM) .It looks at the relatively new concept of Employee Volunteerism with specific reference to the Lifeworks Project that GM employees are involved in. The paper further explores the structure of the program, stakeholders involved and its impact on the target community, finally making recommendations that will encourage more companies to venture into Employee Volunteerism
Chapter one looks into the historical background of CSR and the origins the practice delving into why CSR is important to today??™s corporate world and concludes by defining the scope of this paper.
Chapter two defines what CSR and Employee Volunteerism are and how the two concepts relate to each other. Arguments for and against CSR are also addressed.
Chapter three tackles the role of CSR in development. Chapter four analyses the General Motors East Africa Employee Volunteer Program with emphasis on its Lifeworks project in Mariakani.
Chapter five analyses the findings of the paper and concludes by giving recommendations that seek to promote the concept of Employee Volunteerism.
The purpose of this study is to explain the concept of Employee Volunteerism under the umbrella of Corporate Social Responsibility(CSR).Many companies the world over engage in several CSR activities by way of donations and handouts. This paper introduces Employee Volunteerism (EVP) as an alternative to these handouts.
General Motors East Africa??™s EVP program is used as a suitable case study. The study examines how GM carries out its EVP program with particular emphasis on the company??™s involvement with the Lifeworks project in Mombasa.
The purpose of this study is to highlight the folly of mere handouts as a suitable form of CSR.Companies should seek to emulate GM by encouraging employees to volunteer their skills and time to create sustainable wealth in the communities they work with.
1.2Background of the Study
The history of social and environmental concern about business is as old as trade and business itself. Commercial logging operations for example, together with laws to protect forests, can both be traced back almost 5,000 years. In Ancient Mesopotamia around 1700 BC, King Hammurabi introduced a code in which builders, innkeepers or farmers were put to death if their negligence caused the deaths of others, or major inconvenience to local citizens(Asongu, 2007). In Ancient Rome senators grumbled about the failure of businesses to contribute sufficient taxes to fund their military campaigns, while in 1622 disgruntled shareholders in the Dutch East India Company started issuing pamphlets complaining about management secrecy and ???self enrichment???(Brass Centre,2007).
With industrialization, the impacts of business on society and the environment assumed an entirely new dimension. The ???corporate paternalists??? of the late nineteenth and early twentieth century (Brass Centre, 2007) used some of their wealth to support philanthropic ventures. By the 1920s discussions about the social responsibilities of business had evolved into what we can recognize as the beginnings of the ???modern??? corporate social responsibility (CSR) movement.
Corporate social responsibility could be said to amount to a redefinition of the role of business (Volunteering England, 2008). Increasingly, companies are expected to ??“ and do ??“ account for their social and environmental impact as well as their financial performance, and make a positive contribution to the communities they work in. The market is compelling companies to make changes, as products and brands are judged not only on their quality and pricing but on the reputation of those who produce them. In 2002 a PricewaterhouseCoopers survey of 1,200 business leaders found that 70% of chief executives agree that CSR is vital to the profitability of any company.
CSR is therefore becoming fundamental to the creation of long-term wealth for corporations, as well as being ???the right thing to do??™. Corporate responsibility can also help companies build market share, control risks, attract staff, stimulate innovation, gain access to cash, reduce costs and improve competitiveness.
1.3 Purpose of the study
Early philanthropic efforts focused more on donated money than on volunteer time. However, in the last few years, employee volunteerism has gained momentum as a critical component of corporate citizenship. Employee volunteering describes a new trend in volunteering in which businesses support their employees to undertake volunteering work in the community.
For employee volunteerism to succeed there is need to ensure that companies have access to quality people trained and skilled to effectively deal with societal concerns over and above their professional training.
This project will therefore address the role of General Motors East Africa Ltd.management in training the future elites as responsible leaders equipped with knowhow and skills to address social needs.
1.4 Scope of the Study
The scope of this study will be limited to a large extent on the efforts made by General Motors East Africa Ltd on being a socially responsible company. The study will assess GM??™s Employee Volunteer Program with specific emphasis on its Lifeworks project in Mariakani, the role of GM leaders in the project, the major activities undertaken and resource requirements.
1.5 Definition of Terms
Corporate Social Responsibility (CSR) ??“ CSR is the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve the quality of life in ways that are good for business and good for development (WBCSD, 1999).
Employee Volunteer Program (EVP) – Employee volunteering encompasses any volunteering activity which is supported or encouraged by the business, whether during work hours or in employees??™ own time. (Ramrayka, 2001).
Sustainable development- is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” – Brundtland Commission, 1987
2.0 CHAPTER TWO
2.1 Corporate Social Responsibility
The concept of corporate social responsibility (CSR) is not new. Steiner & Steiner (2006) argue that the concept of CSR was first introduced in 1954 when Howard R. Bowen published his book Social Responsibilities of the Businessman. In his book, Bowen argues that managers have an ethical duty to consider the broader social impacts of their decisions, and that those corporations failing to uphold the broad social contract should stop being seen as legitimate. He also argues that it is in the enlightened self-interest of business to improve society in order to avert the formation of negative public opinions and unwanted regulations (Steiner & Steiner, 2006:121). This latter argument is supported by the fact that early forms of corporate social responsibility (such as corporate philanthropy and the establishment of employee welfare programs) is one of the things that kept Americans from becoming hostile towards large corporations in the early 20th century (Micklethwait & Wooldridge, 2005).
While there is currently no universally accepted definition of CSR (Van Marrewijk, 2003; Carroll, 1999; Blowfield & Frynas, 2005; UNCTAD, 1999), the term is generally used to refer to business??™s greater responsibility to society and the environment. For example, members of the business community define CSR as “the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large??? (WBCSD, 1999), whereas the UK government describes CSR as ???how business takes account of its economic, social and environmental impacts in the way it operates ??“ maximizing the benefits and minimizing the downsides??? (UK Department of Trade and Industry, 2004:3).
Further, prominent author on the topic, Archie B. Carroll, defines CSR as ???the conduct of a business so that it is economically profitable, law abiding, ethical and socially supportive??? (Carroll, 1999: 286).
One of the primary reasons why there is currently no universally accepted definition of CSR is that it is an evolving concept, which over the years has been used to describe an increasingly wider range of corporate activity (Zadek, 2001; Gutierrez & Jones, 2005; Hamann, 2003). CSR, which used to be equated with corporate philanthropy, now includes everything from charitable contributions and social investment to the direct integration of vulnerable populations into a corporation??™s regular business practice (Gutierrez & Jones, 2005).
Another problem with the definition of CSR is the use of a range of other terms as equivalent to CSR. Corporate social responsibility, corporate citizenship, corporate philanthropy, corporate responsibility corporate giving and global citizenship are often used interchangeably.
Therefore, given the number of existing definitions of CSR and the wide range of activities that CSR has been used to describe, Blowfield & Frynas (2005:503) suggest that it is perhaps more useful to think of it as an umbrella term used to describe a variety of beliefs and practices which hold that:
1) Companies have a responsibility for their impact on society and the natural environment, sometimes beyond legal compliance and the liability of individuals;
2) Companies have a responsibility for the behavior of others with whom they do business (e.g. within supply chains);
3) Companies need to manage their relationship with the wider society, whether for reasons of commercial viability or to add value to society, or both.
Corporate social responsibility has received a large amount of research attention over the last decade (Pomering and Dolnicar, 2006). Some scholars argue that the whole issue of CSR is irrelevant to business (Freeman and Liedtka, 1991) while a vast array of writers think that CSR is of strategic importance to business. According to Friedman and Liedtka (1991), the concept of CSR has its roots in the writings of Andrew Carnegie and others in his time. Carnegie articulated two principles he believed were necessary for capitalism to work. First, the charity principle required more fortunate members of society to assist its less fortunate members. Second, the stewardship principle required businesses and wealthy individuals to see themselves as the stewards or caretakers of their property (Asongu, 2007). Carnegie??™s view was that the rich hold their money in trust for the rest of society. However, it is also a function of business to multiply society??™s wealth by increasing its own through prudent investment of the resources that it is caretaking (Freeman and Liedtka, 1991).
In arguing against CSR, Milton Friedman (1962) states that corporations should only pursue their economic self interest. Any attempt to promote corporate social responsibility, however defined, amounts to moral wrong. According to Friedman, the sole purpose of corporations is to guide supply and demand. Friedman further maintains that corporate executives cannot be expected to exercise social responsibility because doing so would require that they compromise shareholder earnings, make decisions that they are not qualified to make, interfere with government responsibilities, and impose costs on their stockholders, customers and employees. This view has also been supported by Rowe (2005) who maintains that corporations do not have a genuine intention of being socially responsible and their CSR programs are basically designed to prevent government from implementing compulsory regulation of business with regards to their contribution to society.
There are however arguments in favor of CSR. A report of the CSR Monitor (2001) indicates that significant numbers of investors take a company??™s social performance into consideration when making investment decisions. The report further shows that social responsibility makes a greater contribution to corporate reputation today than brand image.
Those who believe that CSR programs can contribute to development generally point out the benefits of such programs both to developing countries and to corporations. While the primary objective of CSR is ostensibly to benefit society, one of the ways CSR advocates often convince corporations to engage in more socially responsible practices is by making a ???business case??™ for CSR, arguing that CSR can be mutually beneficial to society and a company??™s financial bottom line.
Companies may also implement CSR programs in an effort to gain the community??™s approval and support for their activities. This is crucial because, although companies may have the legal right to operate, they may not have society??™s approval (Whellams, 2007). This can be costly for a company, particularly if their operations are interrupted by, for example, mass protest or negative media attention. For this reason, companies often invest in community development projects or support local causes in order to acquire or maintain a social license to operate.
CSR proponents further argue that CSR can help companies manage risk and improve their reputation and public image by strengthening the ties between companies and the communities in which they operate (Hopkins, 2004; Sayer, 2005). According to Goddard (2005), ???Corporate activity that benefits the community can increase levels of social participation and generate positive attitudes towards the public and private sectors.
Writers such as Frynas (2005) and Vogel (2005) argue that CSR gives companies a competitive advantage, particularly when vying for contracts. For example, Frynas (2005) observes that in a number of oil producing countries, socially responsible oil companies have been favored by governments when awarding oil and gas concessions.
Finally, CSR proponents contend that CSR can help companies attract and retain top talent (Willard, 2002; Frynas, 2005; Hopkins, 2004). The Millenium Poll on Corporate Social Responsibility found that 20-39% of opinion leaders would be inclined to reward/punish their own company for its degree of social responsibility. Willard (2002) suggests that one way top talent could reward or punish their own company would be to stay in or leave their job. Due to the high costs associated with employee recruitment, Willard argues that socially responsible companies could save money because they would experience less staff turnover. Also, Frynas (2005) notes that CSR could potentially make staff feel more positive about the company they work for, particularly expatriates working for companies in developing countries who witness widespread poverty despite the presence of large wealth generating oil and gas operations.
CSR has become increasingly important because of (UNIDO, 2002, p.1):
I. Globalization and the growth in competition;
II. Increased size and influence of companies;
III. Retrenchment or repositioning of government and its roles;
IV. War for talent;
V. Companies competing for expertise;
VI. Growth of global civil society activism and
VII. Increased importance of intangible assets.
2.2 Employee Volunteerism Programs (EVP)
One form of engagement by an organization in CSR activities is through employee volunteerism. Employee volunteering (Ramrayka, 2001) describes a new trend in volunteering in which businesses support their employees to undertake volunteering work in the community. Employee volunteering encompasses any volunteering activity which is supported or encouraged by the business, whether during work hours or in employees??™ own time. It can be related to the employee??™s professional skills or unrelated to these skills. Employee volunteering can take many forms including one-off team events, longer-term team assignments, individual-role volunteering and one-to-one mentoring.
As stated by Cihlar (2004, Page 1), ???a corporate volunteer program is a planned managed effort that seeks to motivate and enable employees to engage in effective volunteerism under the official sponsorship and leadership of the company.??? Simplified, an EVP consist of ???formal and informal policies and practices that employers use to encourage and help employees to perform community service activities.???
Many employers create EVPs to address community needs and employee interest in helping their communities through their workplace (Tschirhart and St. Clair, 2005).
The importance of employee volunteering has been acknowledged internationally, particularly in literature relating to corporate social responsibility (Imagine, 2003). There is evidence to suggest that employee volunteering benefits the business, employees and the community organization. Research shows that ???one of the most effective methods of enhancing a corporation??™s public image is through the contributions of time and talent from employees??? (Peterson, 2004). Companies reap many benefits from employee volunteer efforts including: improved relations with the surrounding community, enhanced public image, enhanced corporate image (socially responsible corporate image), a positive impact on employee morale and stronger employee commitment, improved internal communication, improved sense of team spirit, a healthier economic and social environment and increased ability to attract and retain high-quality employees.
A business can also benefit from an employee volunteer program because it encourages relationships. Strong relationships among employees, between departments, and between employees and their families are valuable to everyone. When these relationships are nurtured, employees are usually more satisfied with their work life. If employees feel connected to their employer, one or more of these relationships are promoted. Employees can be more satisfied when they see that the corporation they work for is connected to the community they live in.
Over the years a wide range of benefits have been linked to EVPs. For employers, various sources have cited such things as heightened employee engagement with the sponsoring company, innovation provided by professional development, an improved public image, improved relationships with the communities in which they operate, increased ability to attract and retain high-quality employees, a healthier economic and social environment and improved morale and sense of team spirit among employees.
Finally, a number of employee skills central to Human Resource Development have been associated with employee volunteering programs and include:
I. Organizational and time management skills,
II. People skills (caring, negotiating and listening),
III. Accountability and assessment reporting,
IV. Planning skills,
V. Leadership Development,
VI. Budgeting skills,
VII. Survival skills ??“stress management, prioritization,
In this three-way partnership employers are certainly not the only group to benefit, from EVPs although they are the ones most often cited in literature specific to EVPs. For the employee who volunteers his or her time, many benefits that have been typically cited as a reason to volunteer in general are, of course, applicable here. These benefits include such things as building self-confidence, meeting new people and making friends, a feeling of satisfaction or self worth for making a difference and even health benefits produced by stress relief or social interaction among older adults.
The organizations and/or communities to which employees volunteer their time are the third group in the partnership that sustains EVPs. These groups obviously receive support for their missions but EVPs provide a number of invaluable resources that otherwise would not be available by simply recruiting volunteers who are not part of a company sponsored EVP. One benefit in partnering with EVPs for this constituent is access to more and better-organized volunteers than otherwise might be available. In addition, partnerships with EVPs or simply recruiting an individual who works for a company that has an EVP program often times leads to strengthening of philanthropic donations through employer match programs. The diagram below illustrates the three-way partnership.
Realization of individual??™s social responsibility
A human face to community investment project to maximize its impact
License to operate
Grow community = grow profitability
Improved skills = improved profitability
Motivated and proud workforce = stable financial base
Finally, because corporations frequently seek to promote their philanthropic work, these groups can receive significant publicity that, in turn, has the effect of bringing in more volunteers and donations.
The potential impacts discussed above are only several of the many benefits that have been linked to EVPs. A number of research projects documenting these impacts exist (Brudney, Gazely, 2006). They highlight the potential EVPs can have and provide a baseline of research on the topic. However, they generally exist in the form of case studies that seek to document the impact EVPs can have in one or two unique circumstances and are almost universally anecdotal in nature.
Dina Berton (Berton, 2000) writing for Nations Restaurant News discusses a study of Guru??™s restaurant where 70% of the employees participate in an EVP.
This has led, according to the store manager to, ???The overall morale and enthusiasm is better than any place I have ever worked.??? The article goes on to cite a People Report which surveyed 50 full service restaurants and found those with employees active in volunteering averaged a turnover rate of less than 130% compared to a turnover rate of more than 151% for those that did not.
Susan Greco (Greco, 2004) writing for Inc Magazine, attempted to document what impact EVPs had on businesses in her article ???Volunteering: The new employee perk???. Her qualitative report detailing several employee programs found that ???corporate culture- that squishy but vital part of a business life can be defined by corporate giving.??? Similarly, Shari Caudron writing for Industry Week in her article ???Volunteerism and the Bottom Line??™ states, ???a wealth of anecdotal information exists that suggests volunteer programs are good for business. Among the benefits of corporate volunteerism are increased employee morale and employee development, retention and recruitment and maintaining an image as a socially responsible business which is important to socially aware consumers who make product choices based on deeply personal values.???
While the importance of employee volunteerism and its benefits to corporations, employees and local communities has been extensively documented, its place in the Kenyan workplace is yet to be fully appreciated. It is in this regard that we will focus on an EVP carried out by General Motors East Africa Ltd employees.
3.0 CHAPTER THREE
3.1 Corporate Social Responsibility and Its Role in Development
Most models of corporate social responsibility revolve around the controversy as to whether business is a single dimensional entity of profit maximization or a multi-dimensional entity serving greater societal interests. Some scholars argue that CSR-type programs and policies were originally adopted by companies in the mid twentieth century to deflect criticisms of their social or environmental misconduct (Gutierrez & Jones, 2005; Micklethwait & Wooldridge, 2005; Zadek, 2001). Others argue that more and more companies are now viewing CSR as a way to reduce the negative social and environmental impacts of their business, and to maximize the positive impacts of their investments, particularly in developing countries (Blowfield, 2005; Utting, 2005b; Zadek, 2001a).
The interest in (CSR), which recognizes that companies have obligations that extend beyond short-run profit maximization to include notions of social and environmental concern, has increased considerably in recent decades (Palmqvist, 2007). The concept of corporate social responsibility acknowledges the corporate sector??™s obligations towards society beyond short run profit maximization and that the group of stakeholders, whose interests are to be considered in corporate strategies and operations, are extended further than to the shareholders to include societal and environmental values. The World Business Council for Sustainable Development (WBCSD) defines CSR as:???the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve their quality of life.??? This description of CSR reflects the general idea of the concept ??“ to redefine the relationship between business and society and to emphasize the social and environmental responsibilities by corporations acting in the world economy.
The operational phase of the CSR strategies of international companies in a developing context can be divided into two main categories. The first category consists of the social and environmental concerns of a company that are related to its internal structure, such as occupational health and safety, minimum wages, anti-corruption, ensuring compliance with human rights at the workplace and maintaining good relations with employees and supplier (Whitehouse; 2006, Kumar and Balsari; 2004).
One of the primary tools with which companies develop and implement the above conditions is the code of conduct that is established by the individual companies and which outlines the company??™s priorities and standpoints regarding the above issues (Venkateswaran; 2004). The supplier audit is used as a means to monitor the compliance with the code of conduct among the company??™s suppliers.
Certain environmental commitments that are related to the production process can also be argued to be included in this category, such as a continuous aim to find more energy-efficient manners of production and developing products with a lesser effect on the climate. The second category is most often related to the external society outside the company. It includes voluntary projects of a philanthropic character that relates to community development. The beneficiaries often consist of a specific and confined group. These projects can be directed towards both social and environmental concern, such as to support a local school or engage in tree planting.
As the public??™s expectations of corporations continue to rise in light of the greater role these enterprises are playing in society, some companies are searching for ways to integrate CSR into their long-term business strategies in a way that is beneficial to both business and society.
Although it has been argued that being socially responsible does not always benefit the financial bottom line, there are numerous examples of companies that have managed to remain profitable while adopting more socially and environmentally responsible business practices. For this reason, proponents of CSR believe that in addition to or in the absence of government regulation, CSR may be an effective way for corporations to redress the negative impacts of FDI and to actively contribute to sustainable development.
Within the World Bank, the United Nations, and select government-run development agencies, CSR has come to be viewed as a potential mechanism for bringing about development (Blowfield & Frynas, 2005). According to the UK Department for International Development, ???By following socially responsible practices, the growth generated by the private sector will be more inclusive, equitable and poverty reducing??? (Jenkins, 2005:525).
Likewise, the UK Secretary of State for International Development argues: Foreign investors can contribute to economic growth through capital, technology transfer, access to specialised skills, and through their ability to integrate production across several countries. Those businesses that are committed to socially responsible practices can have an even greater impact. They can reinforce the poverty reduction strategies of the country in which they are operating, contribute to environmental sustainability and promote core labour standards and human rights.
The hypothesis that corporate social responsibility initiatives can make a positive contribution to development is not unfounded. However, the narrow focus of the mainstream CSR agenda, and particularly its failure to address the structural determinants of underdevelopment, has led many scholars to question whether CSR alone can encourage development. The following section will outline the key arguments in the ongoing debate about whether companies??™ CSR initiatives can make a significant contribution to sustainable development.
While CSR apparently benefits some companies, most proponents of CSR are generally more interested in the benefits CSR brings to society and the environment. These benefits, which are outlined below, are also what interest development theorists and practitioners.
In the first place, proponents claim that CSR can help companies maximize the spill-over effects of foreign direct investment. (DFID, 2003; Fox, Ward, & Howard, 2002). For example, Fox et al. (2002) claim that governments can better ensure that foreign investors contribute to development through job creation, knowledge and technology transfer, and the provision of infrastructure by adopting inward investment policies linked to CSR-friendly practices.
Examples of inward investment policies include requirements regarding technology transfer, local economic linkages, local community consultation, or public private partnerships that seek to align corporate investment with public sector investments.
Secondly, they argue that voluntary initiatives like CSR can help decrease governments??™ financial burden related to monitoring and regulatory enforcement. CSR is often seen as type of ???voluntary regulation??™ as it entails companies agreeing of their own accord to surpass what is legally required of them in terms of social and environmental regulations. Blowfield (2004) purports that ???voluntary regulation can be effective in developing countries, not least that it promises to reduce the financial burden of enforcement from cash strapped governments, theoretically freeing up funds for development initiatives??? (p. 63).
Thirdly, CSR proponents contend that CSR can benefit society by introducing higher levels of social and environmental performance than those required by local law. Some argue that where the rule of law is weak, ???CSR can be a useful step on the way to better national legislation in countries that have failed to enforce their laws??? (Blowfield & Frynas, 2005). Also, it is recognized that a country??™s legal charter often lags behind social norms and expectations, and in such cases, voluntary initiatives such as CSR can temporarily fill the gap. Sayer (2005) explains: Voluntary codes are an immediate way of reducing environmental harm and the suffering caused by the negative social impact of business. But
they are also a method of designing and testing the benchmarks, feasible ideas, norms, and standards for more ethical business conduct which will, in future, inform the regulatory frameworks and mechanisms (p.265).
A fourth claim made by proponents of CSR is that because CSR programs are becoming more sophisticated, they are capable of making a greater contribution to development. CSR programs are moving away from strictly philanthropic initiatives (such as building a plaza or donating medical equipment to a local hospital) towards investments in projects focused on long-term sustainability (Frynas, 2005). For example, companies are now working more with local governments and non-government organizations to design community development projects that best serve the long-term interests of community members. This is not to suggest that all forms of philanthropy should be abandoned. In some cases, philanthropic contributions are still an effective way for companies to make a valuable contribution to the community, particularly if companies make contributions to organizations that are implementing well-designed development projects. On the other hand, gifts and handouts given directly to the community are now viewed as a less effective way for companies to contribute to sustainable development, as the benefits of this type of philanthropy are generally not long-lived.
Lastly, CSR proponents claim that in some cases, for example where countries are governed by weak or predatory governments, corporations may be more capable of delivering development than governments. Kuper (2004) argues: ??¦if on some occasions corporate leaders are better (morally) motivated than rulers of developed as well as developing states, then we cannot decide by fiat that states are the primary agents of development. In attributing global political responsibilities, we must instead begin with an empirical assessment of the capabilities, opportunities and motivations of diverse and powerful actors. (p.15)
To this end, UNCTAD (1999) remarks: In countries with weak competitive discipline of efficient markets or lacking ???good governance??? reflected in effective governmental institutions to represent the public interest, transnational corporations??™ social responsibility requires that the corporation pay special attention to the interests of underrepresented stakeholders that could be adversely affected by business operations. (p.7)
Although not all proponents of CSR advocate the concept for the same reason, the literature suggests that they at least share the following three assumptions: 1) the private sector has an important role to play in development and poverty reduction; 2) globalization and the rising power of corporations is inevitable; and 3) corporations are capable of reform. These three assumptions form the basis of Sayer??™s (2005) argument that corporations are with us for the long haul, and that we therefore ought to look for ways in which they can be part of the solution to development. ???In the end,??? Sayers writes, ???companies are programmable machines, and we the people, through our moral principles, expectations, demands, and laws, must write the programme??? (p.267).
Organizations today interact with different stakeholders in a deeper and broader level than previously. The organizations provide goods and services for our society. They are also involved in the activities in the local community. The stakeholders are not only concerned about the products and services provided by the organizations but also about the process of the production and labour issues among other issues. Environmental performance, social responsibility, risk management and financial performance are issues that the organizations should address to the stakeholders. The interaction between the organizations and society forces them to take social responsibility into their day to day business activities in order to meet the public expectations. Some pioneer organizations have taken the corporate social responsibility into their business operations and use it as a strategic tool.
3.2 The Role of Employee Volunteerism in CSR
Employee volunteering describes a new trend in volunteering in which businesses support their employees to undertake volunteering work in the community.
Many businesses demonstrate their role as responsible corporate citizens through employee volunteering. Employee volunteering encompasses any volunteering activity which is supported or encouraged by the business, whether during work hours or in employees??™ own time. It can be related to the employee??™s professional skills or unrelated to these skills. Employee volunteering can take many forms including one-off team events, longer-term team assignments, individual-role volunteering and one-to-one mentoring (Graff, 2004).
The term ???employee volunteerism,??? is defined as those community service initiatives planned, organized and executed by employees and endorsed by management that generate specific benefits for the corporation, employees and the community (LBG, 2001).
Employee volunteerism offers a tangible way for businesses to become more personally invested in tackling social problems, to strengthen employee skills and morale, and to cultivate a more positive and productive business environment.
In Kenya, General Motors East Africa Ltd has a developed employee volunteer program as a significant part of their CSR strategy.
The initiative to actively engage the employees in the CSR projects of the company can be seen as another step away from passive philanthropy towards a more profound engagement, aiming at integrating business and society in a most practical manner. As stated by a representative of the company: ???Involvement of people is a much greater investment than involvement in funds only.???
4.0 CHAPTER FOUR
4.1 General Motors East Africa Ltd
General Motors East Africa Limited (GMEA) is a Completely Knocked down (CKD) Kit assembly plant that assembles a full range of Isuzu trucks with about 30% of its products destined to the export market in East and Central Africa. GMEA was established in 1975 as a Joint Venture between General Motors Corporation and the Kenya Government. The operations in GMEA include: Vehicle Assembly, Vehicle Sales & Distribution, After Sales Service and Support Services such as Finance, Information Systems, and Human Resource & Materials Management.
Corporate citizenship is a social responsibility that General Motors takes very seriously as it strives to ensure the sustainability of the world we all share while gaining the respect, admiration and trust of all the peoples of the world. GMs CSR vision is to be respected for excellence in helping to enrich lives and communities through GM business units and GM employee volunteers.
GMEA??™s philanthropic areas of focus include education, health, civic as well as community support. Other areas of focus are the environment, energy and diversity.
4.2 GM??™s Employee Volunteer Program
The GMEA employee volunteer program is managed under the General Motors Volunteer Plus International Program (GMVPI). The GMVPI is part of a portfolio of GM CSR initiatives and is designed to encourage involvement by GM employees??™ in community-based volunteer activities.
The GMVPI program provides grants of US $250 to eligible charities for which a GM employee (or a team of employees) has donated 50 or more hours of volunteer service in a calendar year. Grants are funded by the GM Foundation.
All GMEA Employees are eligible to join the GMVPI program. The employees can either volunteer as individuals or as teams. The employee volunteers are placed in community projects where they can share their skills & knowledge over a period of time.
The program is run in partnership with VSO Jitolee, an international development agency, who provide advice to GMEA on the best way to implement the employee-volunteering program. They also provide vetting, management, logistical and monitoring support for the program.
In 2008 the employees volunteered a total of 4,888 hours and in 2009 a total of 7,536 hours were realized from employee volunteer activities.
4.3 Lifeworks Partnership ??“ Mariakani Safe-T- Stops
LifeWorks Partnership is a Family Health International program designed to reduce HIV transmission, improve care, and reduce the impact of HIV and AIDS along major transport corridors in East Africa.
Under this program, income generating activities have been set up at long distance truck parking stops (Safe-T-Stops) to benefit economically-vulnerable women and youth who reside in communities surrounding truck stops and transport corridors. GMEA employees train and provide technical expertise to the women groups in areas such as marketing, book keeping, business planning, IT, procurement and human resource management. The beneficiaries of this program so far include a textile industry in Mariakani which is now self sustaining. The result is reduced sickness and death among the vulnerable groups, greater regional purchasing power, stronger business networks, higher worker productivity and a better quality of life for transport corridor communities.
It??™s long been clear that poverty increases vulnerability to HIV. When economic options are limited, individuals ??“ particularly older orphans and vulnerable children, their caregivers, and other low-income women ??“ may not be able to choose safer behaviors and avoid risk.
Along key transport corridors in East and Central Africa, HIV prevalence is often more than twice the national average, and unemployment can be high as 70 percent. The LifeWorks Partnership, managed by Family Health International as part of its ROADS Project, creates jobs for these vulnerable groups by scaling up existing businesses, starting new enterprises, and offering incentives to large and multinational firms to outsource production to communities along transport corridors. To stimulate business growth and ensure the success of start-ups, LifeWorks links with private investment funds to provide start-up funding for these small and medium-size businesses and micro enterprise efforts.
LifeWorks is managed by a regional business council chaired by the managing director of General Motors East Africa Ltd, Mr.William Lay. LifeWorks supports a critical public health goal ??“ preventing HIV transmission and helping people with HIV to stay healthier longer ??“ by building regional economies and promoting job growth. The result is reduced sickness and death of employees, greater regional purchasing power, stronger business networks, higher worker productivity ??“ and a better quality of life for transport corridor communities.
4.3 GM??™s Involvement in the Lifeworks Project
GM employees carried out a mapping exercise revealed the high risk groups along the resting stops of the corridor and validated the need for a night VCT service. Therefore, GMEA teamed up with a number of other development partners to enable this service to be provided in the region. In addition, the Moonlight VCT service would also provide clients with information, condoms and treatment for sexually transmitted infections (STIs).
Mariakani town located at the Kenyan coast is the first long-distance trucks stop after leaving the port of Mombasa. It forms part of the Northern Corridor that goes on to Uganda, Burundi, Rwanda and DR Congo.
Along this corridor when truckers stop to rest at night or wait for services at the weighbridges they normally find that medical support services have closed for the day, making it nearly impossible for the travelers to access medical care.
For the launch, 20 GMEA volunteers committed 57 hours each over the weekend to see to the preparation and set up of these services. On the launch, 88 clients received counseling and 84 went through testing. One male and 3 females tested HIV + and were given appropriate referrals. Local residents were enthusiastic about Moonlight, as evidenced by the large turnout at the launch, the number of people who accessed services, and their comments.
Abdulla Ali, a resident of the area commented,
???This is a great idea and I??™ve come from Mombasa to be tested after hearing about this on the radio.???All this time I have not gone to the local VCT.Tonight however, I want to make the most of the Moonlight services.???
And Dorothy, a nurse at Mariakani Sub-District Hospital, said,
???This is a very wonderful thing. I am impressed.???
Dan, the chairperson of Thureya Youth Group who had joined in the day??™s celebration, enthused, ???It??™s a cool thing. Nothing of this nature has ever happened. Kudos.???
Throughout the night there were video discussions about STI??™s, sessions about condom use and a free medical clinic for common ailments and STI??™s, educative video shows and live music.
One of the GMEA volunteers was overwhelmed by the whole experience and had this to say:
???it is truly remarkable at the outcome of this event, I wish we could do more to serve these and more communities I am truly inspired to support HIV ventures in future.???
Ahmed Omar from Kenya Long Distance Truckers Association concluded at the end of the night,
???It has been a challenge for truckers to get access to VCT services and to this end Moonlight VCT is a good idea.???
4.4 Why GM Got Involved
Mr. William Lay, the MD and CEO of General Motors East Africa Ltd.explained his company??™s involvement by asserting that ???as a vehicle manufacturing company that is closely associated with the target community in terms of trucks and the drivers, we are proud to be part of this noble initiative.??? He added, ???General Motors is not only concerned about the quality and durability of the trucks on the road but also the holistic wellness of the drivers that operate them and the community they interact with.GM is keen, as a responsible company in ensuring the safety and well being of all those who earn their livelihoods from the transport industry. Rather than provide handouts through one off cash donations, Mr.Lay asserts that GM seeks to create long-term benefits by creating employment through the following ways:
* Scaling up existing businesses
* Starting new enterprises
* Offering incentives to large multinational firms to outsource production to communities along transport corridors
In 2006, GMEA signed a Global Development Agreement with USAID and Family Health International to foster job creation as an HIV prevention and care strategy
GM donates the time of its staff to train targeted groups in strategic planning and business skills. For example, GM supports the women groups in Mariakani by providing consultancy in the field of marketing, sales and finance. The women are able to sell their handmade tablemats and napkins in a professional manner and thus earn more proceeds from their sales.Plans are underway to outsource the provision of coveralls and dustcoats used by GM technicians to the women groups as a way of further promoting their business by providing a source market.
The moonlight VCT service provides voluntary counselling and HIV testing at the truck stops where medical services are unavailable at night. LifeWorks support the following critical public health goals:
* Preventing the spread and transmission of the HIV virus.
* Helping people with HIV to stay healthier longer .The result is reduced sickness and death among the vulnerable groups, greater regional purchasing power, stronger business networks, higher worker productivity and a better quality of life for transport corridor communities
5.0 CHAPTER FIVE
Chapter two of this paper outlined a number of arguments made by CSR proponents who support the hypothesis that CSR programs can contribute to development. The paper also discussed the increased potential for CSR initiatives to contribute to sustainable development because companies are moving beyond traditional philanthropic initiatives (such as providing schools with computers) and beginning to invest more in social projects aimed at ensuring the long-term sustainability of communities and the environment. For example in Kenya, data collected from General Motors East Africa shows that the company has supported the employee volunteerism culture. Examples provided of activities employees are involved in include sharing of skills such as book keeping, marketing, supply chain management and human resource with community based organizations. The employees are also involved in team events such as marathons that help in raising funds for various charities. The study therefore illustrates a case in which moving beyond philanthropy increases the potential for a company to contribute to sustainable development through its CSR initiatives.
The information collected during this research supports the argument that certain kinds of philanthropic contributions, such as gifts and handouts, are not the most effective way to contribute to development. Based on the experiences of GM, it seems that straight philanthropy often leads to dependency. For example, dwellers of the Mukuru slum community that surrounds the company??™s factory in Nairobi??™s Industrial Area think that the company should take care of them. This is worrisome because a community??™s dependence on a particular company could threaten its development: community members may become accustomed to receiving handouts and hence fail to develop economic activities and ties that will support the community when the company leaves. Moreover, if a company offers handouts to a community on an ongoing basis, the local government may not feel the need to allocate public resources to the community. When the factory closes, the community could then find itself abandoned by both the company and the local government.
In order to prevent communities from becoming dependent on companies, companies should engage in capacity-building projects that help communities help themselves, instead of engaging in straight philanthropy.
One way in which companies can get involved in capacity building is through employee volunteerism. Employee volunteering has been defined as a new trend in volunteering in which businesses support their employees to undertake volunteering work in the community. Employee volunteering encompasses any volunteering activity which is supported or encouraged by the business, whether during work hours or in employees??™ own time. It can be related to the employee??™s professional skills or unrelated to these skills. Employee volunteering can take many forms including one-off team events, longer-term team assignments, individual-role volunteering and one-to-one mentoring.
5.2 Conclusion and Recommendations
The analysis provided in the previous chapters supports the contention that companies??™ CSR programs can contribute to the sustainable development of the communities in which they operate. However, the analysis provided also suggests that the degree to which CSR initiatives can contribute to sustainable development depends largely on the way the initiatives are designed and how they respond to local circumstances. The importance of employee volunteerism in achieving the required results was also highlighted. This part outlines two main conclusions that can be drawn from my research and related research. These are:
* CSR does play a significant role in sustainable development.
* Employee Volunteerism has a role to play in assisting companies achieve sustainable development through their CSR strategies.
General Motors is setting the right example in the way it is managing its CSR activities. It is clear that the tone is set at the top, with the MD, Mr.William Lay playing an active role in the company??™s EVP activities. Companies like as GM should be lauded by the Government. Incentives such as tax reliefs can be offered to companies whose CSR activities are seen to positively impact the populace and create sustainable wealth.
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[ 1 ]. Comments made by Carolyne Matara, CSR Manager-GM East Africa on 29th November 2008