Strategic communications practitioner Marcus Loh has always been intrigued by the Economics of Mutuality. “It takes a different view from the free market economics standpoint in which businesses are focused solely on maximizing shareholder profits,” says Loh who is a senior director for Asia Pacific at WE Communications. What attracted him to the concept was the idea of balancing the short-term needs of stakeholders for the long-term financial sustainability of a company.
Developed by Mars, Incorporated and Oxford University’s Saïd Business School, Economics of Mutuality is said to occur when companies adopt a responsible and holistic approach to doing business that — apart from generating profits — brings positive impact to a broader group of stakeholders. Such acts are loosely defined as corporate giving or corporate social responsibility (CSR). Market watchers argue that engaging in such initiatives is beneficial to companies, even if it may not be in sync with the typical business model which focuses solely on profits.
“Today, 77% of leaders think brands have a moral obligation to engage with a societal issue when it impacts their business, according to findings of a 2019 survey by WE Communications and Quartz Insights. Yet doing well and being good have long been perceived to be a tough path to navigate,” adds Loh, who is also president of the Institute of Public Relations of Singapore (IPRS).
Still, as intrigued as he was by this concept, Loh was confronted with a challenge: how to quantify and measure such impact to ascertain if it truly brings a desired outcome. “When we talk about impact — especially social impact — there are varying degrees to it. The complexity involved in affecting social change means that unintended consequences may arise from one’s sheer desire to resolve immediate challenges in the community,” says Loh as he explains that how impact is measured is not so straightforward.
A curiosity to understand the different methods of creating and eventually measuring impact pushed Loh to enrol for the National Volunteer & Philanthropy Centre’s (NVPC) five-month long Company of Good Fellowship programme in 2019. Here, Loh was introduced to what he found to be a highly useful impact measurement framework that focuses on the ‘output, outcome and impact’ of an initiative to ascertain if the beneficiary group receives it positively, negatively or moderately.
Each of the three concepts focus on a critical aspect of an initiative. For instance, ‘output’ looks at the number of beneficiaries who have benefitted from a project. ‘Outcome’ touches on its mid-term results while ‘impact’ provides perspective on how it benefits a beneficiary in the longer term, such as in their standard of living.
Collectively, these are critical components to what makes a successful CSR project. Having clearly defined objectives for each pillar allows for the creation of an impactful initiative that can affect a desirable change for the beneficiary group the company is reaching out to.
Loh has been putting this knowledge to good use when advising his clients and IPRS team on solutions that can strengthen the effectiveness of their initiatives, particularly during this unprecedented health and economic crisis. One such move was to deepen IPRS’ engagement with the members of its student chapters in nine tertiary institutions. As part of this, the institute has been offering students access to professional courses and networking opportunities to equip them with necessary skills needed by communications practitioners.
The offerings were inspired during Singapore’s “circuit breaker” period which saw unemployment levels reach a rise while job vacancies tumbled. Loh and his team at IPRS see the move as an investment that will generate long-term benefits through more capable communications professionals.
Design for impact
While companies are often enthusiastic to do good, the outcome of their programmes may not be as rosy all the time. A poll of 142 managers conducted by the Harvard Business Review between 2011 and 2015 showed that it was “not the norm” for projects to bring about shared value for the beneficiaries — even though that was the top priority listed under the project objectives.
Mabel Wong, senior director of sustainability consulting for Asia Pacific at ELEVATE, attributes this to a multitude of reasons such as a mismatch between the needs of a beneficiary as perceived by the company and what their needs really are. This often arises from a lack of stakeholder engagement, especially during the planning stages, says Wong, who is also a trainer at the Company of Good Fellowship programme. Such inconsistencies could be a result of companies not having reviewed past projects with a similar focus, to learn from best practices and identify areas for improvement, she adds.
Companies are often focused on "the doing" such as getting the programme started and looking into the programme activities, observes Wong. "Time needs to be set upfront to think about what success looks like and what it takes for a program to be effective to achieve the objectives the program set out to do," she adds.
To avoid such situations, Wong encourages companies to take the time to map out the positive impact they hope to have on their beneficiaries, through their programmes. Using the example of a project aimed at improving the financial literacy of students from marginalised families, Wong identifies the necessary theory of change steps as students gaining knowledge on financial prudence, acquiring skills to apply this immediately and retaining what they have been taught for a long enough period so there is a positive impact on their financial well-being. Identifying such parameters then helps to ascertain what is needed for effective programmes.
These tips have been useful to Kathleen Chin, who leads EY’s CSR initiatives in Singapore. “There are many perceptions around CSR, one might think that it’s mostly about fundraising and securing donations,” she mulls. However, echoing Wong’s sentiments, Chin believes that running initiatives with a clearly-defined end goal and working towards that hand in hand with the beneficiary group is critical for CSR projects to have a win-win outcome.
Chin is now looking forward to gaining deeper insights on effective impact giving, as a participant in Company of Good’s fourth intake of the Fellowship programme which is slated to begin in May 2021. “A role in CSR was never something I imagined myself to be doing,” says the former business consultant who has only been working on CSR projects for the past year. “Company of Good’s online series — comprising webinars and virtual workshops — have helped me get a better understanding of CSR projects, and how to plan them. So, I am excited to join the programme and go deeper into this area. The best part is we can meet like-minded individuals and receive mentorship from industry experts too”.
Given Chin’s enthusiasm, becoming a Company of Good Fellow may just give her a platform to come up with better, more impactful initiatives — just as Loh has been doing since his graduation from the Company of Good Fellowship programme
Company of Good Fellowship is a talent development programme that grooms high-potential business professionals to catalyse change to benefit both business and society. The Fellowship seeks to develop a community of leaders who will strengthen the ecosystem for doing good in Singapore. Applications for its next intake are now open. Find out more at bit.ly/FellowshipTE