Misaligned Needs in the Pursuit of Shared Value: A Multi-Stakeholder Study of the Shift from Corporate Social Responsibility to Corporate Social Entrepreneurship in an Emerging Economy

Abstract

Corporate social responsibility (CSR) has long been highlighted by business and society as essential. However, it has been suggested that over time, the relationship between the corporate donor and their CSR recipients has become fragmented. CSR investments that are predominantly business-driven have led to missed opportunities in fostering a potentially brand loyal market, developing future employees and entrepreneurs and facilitating innovation and growth within the broader economy. In order to address these short comings, it has been argued that a shift from CSR to corporate social entrepreneurship (CSE) may yield a broader set of benefits—for the company, its recipients and society at large. The aim of CSE is to create accelerated and disruptive change in pursuit of new social and economic opportunities. Literature, however, is limited as to the role stakeholders play in this process, especially in contexts where needs and values are not aligned. The current study, drawing on CSE theory, was undertaken to provide a mutually sustainable model of engagement between stakeholders. It also aims to address Porter and Kramer’s (2006) suggestion that there does not appear to be a strategically aligned process available for the benefits of both corporate donors and their recipients.

A combination of phenomenology and Grounded Theory was used as methodological frameworks for this research. Staff from Dell Computers South Africa and two of their donor-funded recipients were used as part of the sample group.

Eight categories emerged from the data analysis, and a conceptual model, based on the traditional Business Model Canvas, was developed. This model acts as a visual tool for corporates and recipients when engaging in CSE practices as well as a conceptual framework to inform future research and advance theory in the field of CSE.

Keywords

Corporate social responsibility corporate social entrepreneurship strategic alignment shared value

Introduction

Corporate social responsibility (CSR) covers a broad range of activities (Agrawal & Sahasranamam, 2016; Carroll & Shabana, 2010; Dawkins & Ngunjiri, 2008; Hinson & Ndhlovu, 2011; Michelini & Fiorentino, 2012; Zhang & Zhang, 2016) but would appear to lack integration into corporate business strategy, and alignment with the recipients’ objectives (Austin, 2000a, 2000b; Green & Peloza, 2011; Rangan, Chase, & Karim, 2015).

Recipients and the communities in which they operate are often in service to the social investment strategy of a donor and they feel compelled to accept the requirements and restrictions placed on them in order to receive the investment (Baur & Schmitz, 2012; Blowfield & Frynas, 2005; Blundin, 2012; Kanter, 1999; Prieto-carrón, Lund-thomsen, Chan, Muro, & Bhushan, 2006). This results in projects being initiated and funded by donors which are not necessarily aligned to community need, and subsequently risk being abandoned or falling into disuse (Kanter, 1999; Nelson, 2010; Rangan et al., 2015; Samuel, 2018).

In South Africa, the definition and practice of CSR has been influenced by the legacy of Apartheid and should be considered in the context of post-democratic political, social and economic changes. The South African government’s Broad-Based Black Economic Empowerment (B-BBEE)¹

B-BBEE is one of the primary instruments in the South African government’s attempt to redress the legacy of apartheid. It is aimed at empowering Black South Africans to fully participate in all spheres of society in order to address economic inequalities. The B-BBEE framework attempts to address the economic needs of a section of society that has been adversely affected by past government policies. The framework includes a Generic Scorecard which is used to evaluate the extent to which businesses have complied with the elements included in the Scorecard. The Scorecard includes the elements of skills development, preferred procurement, enterprise development and socioeconomic development.

strategy, of which CSR forms a part of, has a structured scorecard to measure various forms of social investment and rate companies—local and international. CSR in South Africa is further influenced by the King Report on Corporate Governance for South Africa (Esser & Dekker, 2008; Hamann, Khagram, & Rohan, 2008). A fundamental aspect of the report argues for CSR to have an inclusive approach which recognises that stakeholders, including the community in which the company operates, need to be considered when developing a CSR strategy (The Institute of Directors in Southern Africa, 2009), even though current research (Hamann, 2003; Hamann et al., 2008; Reddy & Hamann, 2018) would suggest that this interaction may be superficial and poorly aligned. Despite CSR being highlighted as a business imperative in South Africa, the strategic dissonance between corporate donors and recipients is evident by the many funded yet failed projects (Kanter, 1999; Samuel, 2018; Samuel & Mqomboti, 2017).

Impractical grants and CSR projects which are overly donor-centric can lead to missed opportunities in fostering a brand loyal market, increasing the talent pool of educated and skilled future employees and entrepreneurs and facilitating innovation and growth within the broader economy (Austin, Leonard, Reficco, & Wei-Skillern, 2013; Zhang & Zhang, 2016). To address these challenges and misalignment, donors need to accelerate their existing CSR models in order to ‘generate a more profound social impact’ (Zhang & Zhang, 2016, p. 51) and leverage off of ‘a dynamic, flexible, multifaceted vehicle’ that delivers ‘positive social impact, organisational development and new core business opportunities’ (Hadad & Cantaragiu, 2017, p. 256) in pursuit of social purpose and profit. It has been suggested that these objectives may be achieved through the pursuit of corporate social entrepreneurship (CSE) (Hadad & Cantaragiu, 2017; Hemingway, 2013).

CSE is regarded as the combined efforts of entrepreneurial thinking and action along with social value creation (Agrawal & Sahasranamam, 2016; Michelini & Fiorentino, 2012). As a practice, it argues for collaboration and entrepreneurial behaviours in order for business and society to enjoy mutual benefits (Austin, 2000b; Hemingway, 2005b; Zaefarian, Tasavori, & Ghauri, 2015). However, while CSE can be viewed as an accelerated version of CSR, a practical process towards achieving this remains relatively underdeveloped. Furthermore, a strategically aligned model that benefits both parties, specifically in the initial phases of the grant application and allocation, remains elusive (Porter & Kramer, 2006).

This study examined the CSR process of Dell Computers South Africa (Dell SA) and two of their recipient organisations. Some CSR processes have been successful but not others. It has been hypothesised that unsuccessful CSR projects are a result of a misalignment between the donor and the recipient in the initial stages of the grant-making process, as well as the failure to view the grant process through the lens of shared value creation.

This current study argues that CSE might be a more robust method of achieving alignment between the needs of donors and recipients (Hadad & Cantaragiu, 2017; Hemingway, 2005a). This study aims to understand the relationship between donors and recipients in the grant-requesting and grant-making stage of an existing CSR programme and seeks to understand how strategic alignment and shared values might result in a practical CSE model that is mutually beneficial to both donors and recipients.

Overview of the Literature

Corporate Social Responsibility

CSR has been highlighted as a business imperative worldwide; however, a strategic dissonance between donors and recipients is evident by the many funded and failed projects that address the internal requirements of the corporate donor but have long-term negative impacts on the recipient and the communities they represent (Baur & Schmitz, 2012; Kanter, 1999; Reddy & Hamann, 2018; Samuel, 2018; Samuel & Mqomboti, 2017).

While open to debate and criticism (Dahlsrud, 2008; Friedman, 1970), CSR remains an important aspect of corporate activity (Carroll, 1991; Carroll & Shabana, 2010) and although the definition might have changed over time, the premise still remains that business has ‘responsibilities to the society it operates within’ (Hartman, DesJardins, & Macdonald, 2008, p. 208) and to be held accountable for its actions within society (Chandler & Werther, 2011). The range of activities conducted in the name of CSR are innumerable (Dawkins & Ngunjiri, 2008; Hinson & Ndhlovu, 2011) but just how integrated these are into the business strategy and the company’s area of operation, and degree of collaboration with the recipients remains a question (Austin, 2000a; Schaeffer & Dunn, 2012). Porter and Kramer (2011) suggest that traditional CSR practices have failed to address societal challenges sustainably, with corporate donors placing CSR on the periphery of their agenda. In doing so, they not only fail to address and co-create solutions for improved societal impact, but also miss out on the opportunity to test and create innovative solutions for further business development in new and emerging markets (Agrawal & Sahasranamam, 2016; Cowe, 2004).

The role of a corporate donor within the CSR milieu is contrasted with that of the recipient who represents and addresses the specific needs of a community (Arenas, Lozano, & Albareda, 2009; Martens, 2002). However, over time the objectives, needs and intention of the donor and those of the recipient has become fragmented (Blundin, 2012; Genasci & Pray, 2008). Blundin (2012) and Genasci and Pray (2008) further suggested that should a CSR project take place, the donor holds great power, selecting initiatives that reflect their interests, and those that will show better results, and not necessarily those of the recipient community.

Literature highlights the need for corporate donors to harness their business success and link this with social progress in order to address some of the most pressing challenges outside the traditional business context (Austin et al., 2013). CSE has emerged as a new interpretation of how businesses and society can achieve greater social value (Michelini & Fiorentino, 2012; Porter & Kramer, 2011) and is viewed as a valuable next step towards addressing contemporary challenges faced by business and society.

Corporate Social Entrepreneurship

Prior research suggests that CSE has emerged as a more robust, accelerated and valuable version of CSR (Agrawal & Sahasranamam, 2016; Austin et al., 2013; Hemingway, 2013). CSE should be regarded as an approach that creates opportunities, embraces disruptive change and has the potential to improve relationships between society and business (Elkington, 1997; Michelini & Fiorentino, 2012; Zhang & Zhang, 2016). Furthermore, CSE can be observed as the socially conscious entrepreneurial behaviour of large and established corporations (Zaefarian et al., 2015) that involve the fast-tracking of an organisation’s existing CSR efforts in order to become a driver of innovation and societal change (Agrawal & Sahasranamam, 2016; Austin et al., 2013).

Like all entrepreneurial activity, CSE involves adopting an appropriate mindset, identifying innovative opportunities, expanding on existing corporate values and purposefully creating and fostering an enabling environment for employees who wish to take part in strategically aligned activities with external stakeholders (Agrawal & Sahasranamam, 2016; Zhang & Zhang, 2016). Zaefarian et al. (2015) argued that CSE involves embracing an entrepreneurial orientation that combines risk-taking and proactiveness, with features of social entrepreneurship such as system change and social value generation.

The objectives of CSE is to transform organisations and society by creating an enabling environment, fostering entrepreneurial thought, positively impacting the triple-bottom line and building strategic alliances with all stakeholders (Austin & Reficco, 2009). It is in this entrepreneurial orientation that CSE differs from CSR, resulting in financial and intangible gains as well as social value creation (Austin et al., 2013; Spitzeck, Boechat, & Leão, 2013).

Although CSE as a concept and practice is still relatively new to academic research and as such has not fully emerged with a unifying definition or body of knowledge, research surrounding the concept highlights two dominant themes namely strategic alignment and shared values (Agrawal & Sahasranamam, 2016; Calton, Werhane, Hartman, & Bevan, 2013; Rahdari, Sepasi, & Moradi, 2016; Spitzeck et al., 2013). Although shared value and strategic alignment are also considered tenets of CSR, literature suggests that these qualities have been somewhat lost in current CSR practices, hence the need to explore how CSE can be framed and adopted as a mechanism for accelerating corporate donor’s ‘organizational transformation into [a] more powerful generator of societal betterment’ (Austin & Reficco, 2009, p. 3).

Strategic Alignment and Shared Value

The pursuit of strategic alignment can be viewed as the way in which a company uses its resources and skills in order to promote the merging of societal and economic goals and is often viewed as the starting point for and CSE venture (Jamali, 2007; Jamali, Yianni, & Abdallah, 2011; Leonard, Austin, & Quinn, 2004; Zhang & Zhang, 2016). According to Austin (2000b), the process of strategic alignment begins with two parties answering a series of questions that include discovering if there is ‘partnership purpose and fit’. CSE provides a structure for corporate donors and their respective recipients to form strategic alliances, thereby creating new benefits for business and society alike (Agrawal & Sahasranamam, 2016; Austin et al., 2013; Browne & Nuttall, 2013; Vallejo-Fiallos, 2019; Zhang & Zhang, 2016; Zhao, Park, & Zhou, 2014).

The success of strategic alignment lies in the ability of each party to understand the interests, challenges and objectives of the other (Poret, 2014). However, Seitanidi (2010) argued that current partnerships between corporate donors and recipients provide limited opportunities to discuss differences of opinion with the hope of fundamental changes emerging from these debates.

Research suggests that strategic alignment, between the donor and recipient, is a framework on which these two parties might address social and economic challenges, develop specific measurements and forge a way towards mutual benefit (Carroll & Brown, 2018; Chandler & Werther, 2011; Taylor, 2015). Jamali et al. (2011) asserted that the appropriate use of strategic alignment should result in CSE initiatives that have mutually beneficial economic and societal outcomes.

Porter and Kramer (2011) further discussed the notion of shared value and its role as a driver for innovation and growth from a business and social perspective. While Beschorner and Hajduk (2017) suggested that Porter and Kramer’s (2011) notion of shared value fails to fully understand the expectations and challenges faced by society, the current research argues that strategic alignment should be viewed as a more robust and engaging model to understand the challenges faced as a result of the disconnect between donors and recipients. There is a mutual dependence between donors and society (Michelini & Fiorentino, 2012); this implies that both donor decisions and recipient policies should follow the principle of shared value with choices that benefit both entities (Austin et al., 2013) with donors focused on integrating recipient perspectives into their overarching business strategy (Anbarasan & Sushil, 2018; Michelini & Fiorentino, 2012).

The notion of shared value in a developing economy context, such as South Africa, becomes critical where the link between donors and recipients is intensified due to the need to balance viable business opportunities with considerable societal challenges (Crane, Palazzo, Spence, & Matten, 2014; Jamali, 2007; Nyuur, Ofori, & Debrah, 2014).

The literature has indicated that partnerships, which are strategically aligned from the start, allow for partners to address social issues in a more creative manner, develop innovative solutions and, as a result, strengthen the partnership between the two (Jamali et al., 2011). Although there is no denying the need for donors and recipients to work together in the pursuit of mutually beneficial outcomes, the way in which both parties go about this, especially in lights of CSE, needs to be explored further.

Methodology

The current study drew on phenomenology with influences from Charmaz’s (2006) constructivist approach to Grounded Theory. While some researchers are aware of the antagonism towards mixed methodologies and ‘method slurring’ (Baker, Wuest, & Stern, 1992), there are others who advocate the use of two, specifically phenomenology and grounded theory in triangulation (Annells, 2006; Hussein, 2009; Padgett, 2017). Furthermore, phenomenology compels one to recognise that everyday experiences lead to assumptions thus putting one at risk of missing the real puzzles and contradictions (Buckingham et al., 2011).

The current study took into consideration that the research methodologies being used were qualitative in nature and recognised a need to ensure reliability and validity when conducting the research. The current research addressed this by utilising Onwuegbuzie and Leech’s (2007) Qualitative Legitimation Model in order to identify the threats to internal and external credibility at each of the stages of the research process. One of the key internal threats identified in the Qualitative Legitimation Model in the current study includes researcher bias due to the involvement of one of the researchers within the field of study and the subject company (Dell Computers). Validity was further enhanced by remaining faithful to the Grounded Theory approach by moving between the field, the data and the literature.

Research Sites

This study used a purposive sampling strategy among senior management and key stakeholders at varying levels within Dell SA, and two recipient organisations who received CSR support from Dell SA, namely the Student Health and Welfare Centres Organisation (SHAWCO) and Christel House South Africa (CHSA). Consistent with Charmaz’s (2006) approach of Grounded Theory, there was no need to conduct more interviews once the theory had been built.

Dell SA has been involved in CSR programmes in South Africa since 2003, beginning with ad-hoc projects and moving to more substantial programmes aligned with Dell’s global investment requirements. Annually, Dell SA exceeds the required investment threshold in CSR.²

This threshold is set as part of Dell SA’s equivalency calculation related to B-BBEE legislation whereby a measured entity is required to invest 1 per cent NPAT into initiatives that typically strive to promote access to the economy for recipients.

There have been instances where projects initiated by Dell SA, following the requirements made by Dell Global and using local input, have been successful, while similar programmes, following the same processes and procedures, have fallen short on required metrics resulting in the programme being discontinued.

One of the Dell SA’s recipients is CHSA, a private school based in Cape Town which aims to improve the lives of children living in severely disadvantaged communities. The school’s holistic model focuses on health, education, social awareness and personal upliftment.

A second Dell SA recipient is SHAWCO, one of South Africa’s largest student-led organisations (SHAWCO is part of the University of Cape Town) providing health and welfare projects as well as educational programmes to impoverished communities in Cape Town. The education arm is focused on providing learners with support through a structured afterschool curriculum as well as services such as arts, ICT skills, sports, entrepreneurship, life skills and career advice.

Both CHSA and SHAWCO are driven by a board of community members, families and local stakeholders who help form and drive the strategy of their respective programmes.

Data Collection

Data collected and used for the current research included primary data via semi-structured in-depth interviews, and secondary data in the form of reports, documents and internal communication briefs from the respective donor’s and recipients’ organisations.

Following the interviews, the data were analysed and a series of codes were developed using elements of the Grounded Theory process. After the creation of the initial codes (parent codes), further analysis was conducted to collapse and merge repetitive codes. These were marked as subcodes or child codes. From the parent codes, a series of categories were then developed. This was conducted by writing the subcodes and sectioning them into groups of similarity. At this stage, the groups were reviewed in relation to the memos and data and refitted accordingly. Some of the codes were appropriate in terms of fit for a category, while others needed refining and further collapsing in order to give a richer context. Constant reviewing of the codes against the memos and the data was conducted throughout the process.

Limitations

Possible limitations, in relation to the current research, include researcher bias due to one of the researchers being actively involved in the CSR arena from both a donor and recipient perspective. Further limitations, from a geographical perspective, include the study only taking place within South Africa and more specifically within Gauteng and the Western Cape provinces. From an organisational perspective, there is the risk of sampling bias with regards to the study being limited to one donor (Dell SA) and two recipients (SHAWCO and CHSA). However, despite the limitations identified in this study, the research is expected to provide insight and guidance to both donors and recipients in their adoption of CSE processes and to advance this nascent field.

Results and Findings

This research was undertaken to understand the relationship between donors and recipients in the grant-requesting and grant-making stage of an existing CSR practice. It seeks to understand how strategic alignment might result in a practical CSE model and process that is mutually beneficial to both donors and recipients. The research examined Dell SA and two of their recipients and sought to develop a conceptual and practical model to support future CSE initiatives.

Analysis of the data resulted in the development of eight key categories that were of greatest mutual importance to the recipients and the donor with regards to the CSR grant process. These eight categories are based on the data analysis and findings in relation to the current research.

Goal and Vision Alignment

The results indicated that for both the donor and the recipient, creating alignment while remaining true to their respective visions and mission was a challenging process. As was developing a relationship and being clear and precise in the objectives of the programme for both the donor and recipient. Finding a way to develop trust and buy-in with the recipients and the community they serve was critical as was investing in programmes that reflected the donor’s overall business strategy.

You need to inform communities regularly about any plans that you have. You need to consult on a regular basis … At the end of the day for me it is about the people out there. You want to have a balance between the needs of the community, the organisational needs and expectations, and the donor needs and expectations. (SHAWCO Respondent 3)

The strategy should be aligned with the company’s business strategy and values as well as with the development priorities and strategies of the targeted community and country. (Dell Respondent 2)

Strategic Intent

From a grant-requesting and grant-making perspective, it was evident that strategy played an important role. Likewise, was the understanding that strategies change and failure to adapt to change could lead to the collapse of projects or a reduction in funding. A focal point for both the donor and recipients was centred on unfocused or ‘ad-hoc’ grants—often the result of spontaneous non-strategic decisions. The data also indicated the need for donors to develop an open and clearly communicated grant-making strategy. Donor and recipients specifically made reference to existing CSR practices having ‘trends’ which constantly change in terms of focus and strategy of donor and how this can negatively impact a community and also result in innovation.

As long as it is all communicated … you can’t blame somebody if their [donor] focus changes. But they do need to give warning and work it out with us … (SHAWCO Respondent)

[I]f invested strategically [funds] could make visible impact in the fight against poverty, unemployment etc. … Companies need to differentiate between charity and sustainable giving. (Dell Respondent 2)

Communication

The research findings indicated that communication was necessary for the implementation of the donor and recipient’s respective strategies and as such the success of a programme should be viewed as the responsibility of both the donor and recipient. The recipients observed that more communication was required in order for them to achieve their respective strategies.

I think it would really eliminate so many problems of both funders and charities are facing, more talks or communications where you get your funders and the various charities to actually sit and communicate so that they both understand what the needs are. (CHSA Respondent 5)

Responses also indicated that the donor places too much focus on communicating the process but not enough on joint communication between the two parties.

[H]aving more conversations is a much better way of going about giving a grant … You need to have that conversation to find a match because a piece of paper quite often doesn’t do that … I think that engagement is so important. (CHSA Respondent 3)

Value Creation

The donor and recipients were both vocal about the practice of creating value and building a partnership where both parties and the external community benefited; they felt that failing to do so would lead to the failure of the project and ultimately waste donor funds.

Commitment and buy in from communities are key to the success of any [CSR] project. It is vital to ensure that this is addressed at the onset. For [CSR] to achieve its potential, it must focus on key areas of interaction between the organisation and its environment and address value creation activities at the center of the strategic agenda. (Dell Respondent 3)

The research also indicated that a new CSR model would need to be implemented in the future for programmes to create shared value and impact. The quotation below drives home the notion of integration with the recipient and donor, as well as building ownership when creating value.

As we look to expand … I think it is quite likely that we may look to partner closely with corporations and move from the existing donations model. (CHSA Respondent 1)

Relevance and ROI

The findings indicated that the recipients recognised the need to make grant requests that were of relevance for them and the community they serve as well as the donor. However, a note of contention was raised by one respondent who felt that donors could at times impose their own needs on recipients where specific assistance was not required or was not of relevance.

[H]e point still though is that our focus is always on the community and on the students. So even though it was important for [the donor] to do this for their staff it is more important that we actually look at those kids and say what they need. (SHAWCO Respondent 1)

Both parties agreed that when donor investments were made which played to the strength of the donor and aided the recipient appropriately this resulted in mutual ROI.

We invest because we want to impact underserved communities, increase our brand value, attract, engage & retain employees and strengthen local relationships. (Dell Respondent 3)

Harsh Realities

For recipients it was evident that the task of applying for grants and relying on donors can be an incredibly daunting and off-putting process that takes time and, while aware that donor dependency and changes in donor funding strategy could be a harsh reality for all parties, the severity of that reality was more abundant in the responses from the recipients. Two specific areas were highlighted as harsh realities for the recipients. The first involved the recipients’ relationship with the donor and the fear associated with anticipating donor decisions.

With one of our donors … we go through quite a scary situation every year because this one individual is … literally the sole decision maker … unless he comes back and makes the decision, we either get quite a sizeable amount of money, or I fear, zero and that is a very scary situation. (CHSA Respondent 1)

The second area involved the experiences of the recipients living and dealing with contrasting realities in comparison with the donors; these challenges were not necessarily always taken into account from the donors’ perspective. The recipients felt that donors were not always aware of what happens in the community where the recipients operate daily. Instances of crime, theft and often a need for logistical support were all highlighted as commonplace realities for the recipients but were not necessarily something that the donor might have considered when approving the grant.

When there is gang conflict … then there is a sudden drop in people that come in from the immediate community because of safety reasons. Then we must focus a bit more on the learners and some of the adults that do come. So that is a challenge for us as well as the vandalism … so on the one hand we think we are moving forward and then you take a few steps back. (SHAWCO Respondent 3)

Sustainability and Impact

The donor and recipient respondents had similar views on what sustainability meant with regards to building a relationship which might evolve into a long-term sustainable partnership.

The way we look at it in terms of sustainability … we prefer sort of annuity income schemes rather than once off annual donations because of the obvious predictability and the risk mitigation aspect. However, in the future I believe, and I hope [that we] will have a real partnership [with donors]. (CHSA Respondent 1)

Sustainable would be [that] we put in an ecosystem in place so that the initial investment grows and adds value … for me that is an important thing, that peace of mind, that comfort, I have got a partner here that will work with me for five years. (Dell Respondent 4)

However, the donor and recipient respondents had varying views on the length of time a project should be supported in order to become sustainable.

When I think about sustainability I don’t think necessarily about self-sustainability, I think we are going to need corporate funders in the foreseeable future. (SHAWCO Respondent 2)

One of the recipients discussed the notion of forcing sustainability and impact for the sake of an investment that was not necessarily required and could potentially lead to negative consequences. This was echoed by one of the donor respondents who voiced concern for recipients requesting grants that could not be supported over time.

I think people see having [a] school computer lab as a plus for a school, that they are more advanced than the neighbouring schools that don’t have the technology … It’s difficult to just leave a project, giving them the equipment and then not being able to be hands on [over] or have someone to go out and make sure it’s working. (Dell Respondent 1)

Monitoring and Evaluation

Respondent recipients noted that the requirements donors placed on them with regards to monitoring and evaluation were often onerous. They observed that there was a general lack of understanding around mutual expectations. While the recipients felt that it was important to present quantitative data, they also stressed the need to communicate the success of a programme via qualitative information that articulated the long-term impact a grant might have on a community.

We have a programme where parents are brought in and they are taught basic business skills … At the end of the day they feel proud—I can work on the computer and do my own CV and make an application. It ties in with pride. Something [to which] you won’t really attach an amount … but it fulfils them as well that they are able now to do things that previously they didn’t even think at a certain age they would be able to do. (CHSA Respondent 3)

From a donor’s perspective there was an understanding that while recipients would be able to provide non-tangible value, which could not necessarily be easily measured, there was also the need for reporting on specific donor requirements.

[T]he fact that in some communities, people may never have had the opportunity to interact with a computer, having that interaction helps make sense … there is no tangible measurement but certainly the subliminal measurement would be exactly that. (Dell Respondent 4)

To gauge importance and ensure that it [CSR] is strategic the following areas are considered when granting and reporting; Total number of students directly enrolled/participating in the programme, total number of students served by your organisation, total number of individuals who are impacted … total number of teachers/educators trained and/or participating in delivery of your programme, the number of hours that teachers/educators have participated in technology training for programme. (Dell Respondent 3)

The above two quotes exemplified the rigid need from a quantitative perspective and also the understanding that qualitative results, specifically in the instance of human impact stories, were of equal importance for the donor.

Discussion

Acknowledging the success with which the Business Model Canvas (Osterwalder & Pigneur, 2010) has become associated and the fact that many of the themes that arose from this research resonate deeply with entrepreneurial characteristics, it was decided to base the findings on a similar-style canvas. In relation to the research, this canvas has been termed the Corporate Social Alignment Canvas (CSAC) and outlines the areas of importance and focus when attempting to create strategic alignment between donors and recipients in the granting process. We suggest that the CSAC can be viewed as both a conceptual framework and a planning and reflective tool to create alignment between donors and recipients in pursuit of shared value within CSE programmes.

The canvas (see Appendix A) charts the process of addressing each of the eight categories amid a strategically aligned procedure. Furthermore, it addresses Porter and Kramer’s (2006) need for a strategically aligned process whereby donors and recipients benefit, as well as the need for a practice which puts a halt to continuous cycles of inequality and fragmented donor-driven practices (Baur & Schmitz, 2012).

The CSAC works on a similar premise to the Business Model Canvas with the intention of launching and facilitating dialogue between donors and recipients with regards to shifting existing CRS practices towards that of CSE.

Goal and Vision Alignment

Having a clear vision and goals is important for the recipients and donor, however ensuring these are shared and accepted between both parties is a key priority in ensuring that the CSE process is sustainable (Austin et al., 2013; Carroll & Shabana, 2010; Hemingway, 2013). The data echoed the literature that while some donors provide ad-hoc and unfocused donations (Hemingway, 2013; Porter & Kramer, 2006), others were becoming more focused on wanting to develop a way to work with the recipient and find solutions that might meet both their needs (Genasci & Pray, 2008; Zaefarian et al., 2015).

In addition, it became apparent that in the past recipients might have requested funding and accepted grants from numerous sources which did not necessarily share their vision. This is no longer necessarily the case; the challenge now is how to define and communicate specific recipient programmes and identify suitably matched donors (Austin, 2000a; Porter & Kramer, 2011).

The canvas addresses this by questioning the mission, vision and goals of all parties with respect to CSE programmes and how the programme outcomes might result in a grant which benefits all. While there is a disproportionate focus on the goals and vision of the donor and not enough on the recipient (Prieto-carrón et al., 2006), the current study indicates that there is a desire from both parties to create alignment. Only by engaging with stakeholders, and sharing common ideas and goals can donors and recipients make a sustainable and mutually beneficial impact (Browne & Nuttall, 2013).

Strategic Intent

Strategic intent reflects on the role between the recipient and the donor in terms of their existing CSE strategies, how these strategies interconnect, what contingency plans are in place should strategies change, or funding is reduced and how fixed both entities are with regards to their strategies. Importance is placed on the potential pitfalls of the donor and recipient should their strategies not be aligned.

Recipient strategic intent focuses on identifying existing needs and engaging with existing and potential donors who might be able to invest in projects that provide benefit for both (Jonker & Nijhof, 2006) while donor strategic intent concentrates on aligning core business services, practices and products with recipient programmes (Jamali et al., 2011; McElhaney, 2009) and ensuring relevance to their constituency and strategy (Blowfield & Frynas, 2005; Blundin, 2012; Kanter, 1999). Following a strategically aligned process enables both short and long-term goals to be achieved (Gajda, 2004), and while historically this has worked between similar types of organisations (Austin, 2000a) the research findings suggest that strategic alignment needs to be a cross-sector process. Strategic intent should be viewed as what needs to be achieved, while communication refers to the specific channel or medium used to convey these messages and the manner in which these messages are shared.

Communication

Blundin (2012) and Genasci and Pray (2008) discussed the idea of donors and recipients becoming fragmented in their communication with one another. While this was not specifically the case in the current study, it was felt by both parties from previous CSR engagements. A breakdown or loss of communication leads to a failure to collaborate and can result in failed projects which can affect the broader community beyond the donor and recipient (Austin, 2000a; Zhang & Zhang, 2016). Previous calls to redefine how donors and recipients influence and communicate with one another, in order to achieve a common vision and set of goals, support this element of the model (Anbarasan & Sushil, 2018; Austin et al., 2013). Clear communication channels are required in the CSE process with responsibility coming from both sides; the result of doing so could lead to better aligned strategies and fewer failed projects (Samuel, 2018; Zaefarian et al., 2015).

Value Creation

Value creation addresses stakeholder buy-in and the integration of the donor, recipient and wider community needs. This also questions how donors can provide grants which empower recipients and the community they serve to take greater programme ownership.

The current study emphasised that the term ‘stakeholder’ needs to be broadly inclusive of the local community, especially when deciding which donor-funded programmes and projects should be implemented. Being able to align all stakeholders around a common value creation objective sets the foundation for the success of a CSE programme (Agrawal & Sahasranamam, 2016; Austin et al., 2013; Michelini & Fiorentino, 2012; Zhang & Zhang, 2016). Mutual respect was flagged as important—especially for recipients who often experience donors as lacking an inclusive spirit and providing funding that does not align to recipient and community capacity (Browne & Nuttall, 2013; Hine & Preuss, 2009; Kanter, 1999). Browne and Nuttall (2013) suggested that donor grants need to go beyond high profile but low impact initiatives and polished annual reports. The challenge lies in creating mutual value through focused programmes which represent the needs of the community, the recipient and the donors, all of whom feel they have a part to play in the success of the programme.

Relevance and ROI

This category relates to investments into recipient programmes and communities; not only should this make sense and add benefit to the recipients but also make business sense for the donor. Discussions regarding actual versus perceived needs of the recipient, and how CSE initiatives that deliver mutual impact can be implemented, need to be addressed in this section of the model.

While the boundaries between the donor and recipient have become increasingly porous (Jamali & Keshishian, 2009; Prieto-carrón et al., 2006), specifically when requesting and making grants which meet the needs of both parties, opponents argue that the donor has disproportionate power which influences the quantum of donations, to whom and for which programmes, even if this is inappropriate for the recipient (Blundin, 2012; Genasci & Pray, 2008). Donors showed a tangible desire to provide grants that would see a long-term ROI in terms of creating brand loyalty, driving internal innovative and delivering enough funds and skills that would result in empowerment and skills development for the recipient and their community. This reinforces the literature which also calls for relevancy in terms of positively impacting a community while driving internal innovation and staff retention (Leonard et al., 2004; Zaefarian et al., 2015). Recipient’s call for relevancy was linked to the provision of equipment and funding that was up to date and sufficient to ensure that the programme continued to its natural conclusion. Their sentiments are echoed by Blundin (2012) and Kanter (1999) who argue that unfocused donor programmes can cause more harm than good.

Harsh Realities

This category addresses issues which few of the donor respondents mentioned in the interviews but which the recipient respondents felt that was crucial with regards to mutual success and longevity. The recipient respondents discussed challenging realties which went far deeper than not asking, for example, for additional skills support in a grant. Their realities involved external challenges which ultimately have a direct and negative impact on their programmes and as a result the grant supplied by the donor. This in turn has a direct impact on ROI for donors and recipients alike. Harsh realities such as gang violence, theft and reduced funding for programmes all have devastating impacts on the programmes these recipients have been trying to establish in partnership with the communities they serve. Harsh realities should be viewed as contextually and geographically specific. Literature highlights the need for donors to take into consideration the context and the community in which the recipients are operating (Tilt, 2016; Wanvik, 2014). This is especially true for a country such as South Africa where crime and gang violence are prevalent, specifically in areas where donor support is required (Hamman & De Cleene, 2005; Reddy & Hamann, 2018). Failing to take these concerns into consideration and plan around them, particularly from an alignment perspective, could lead to a severe failure for the donors in terms of any competitive advantage or ROI they might have had at the start of a CSE journey (Brown, 2017; Chandler & Werther, 2011).

Sustainability and Impact

Sustainability and impact look to what sustainability means for the donor and recipient—these are often understood and enacted differently, and to develop clarity regarding the donor investment that makes the most sense for the recipient and their community, while also addressing the donor’s own objectives.

In some cases, grants are made which provide insufficient value to the recipient and cause more negative impact on their projects and community than necessary (Schaeffer & Dunn, 2012). Sustainability in the CSE context is very often left to the donor to define (Spitzeck et al., 2013; Zhang & Zhang, 2016), and the need for clarity of understanding between the parties will inevitably lead to an improved partnerships and better outcomes (Elkington, 1997; Porter & Kramer, 2006). Partnerships between the donor and recipient also play a key role in terms of impact with strategically aligned partnerships being the fundamental driving force (Jamali et al., 2011; Kanter, 1999; Peloza & Falkenberg, 2009). As stated by the recipient respondents, it is important for them and the donor to gain a deeper understanding of the communities they serve in order to create and deliver programmes which have an impact on, that is, both high in quality and reach.

Monitoring and Evaluation

Monitoring and evaluation occur concurrently with sustainability and impact in that this category needs to be put into action and evaluated continuously throughout the CSE process. It has been argued that CSE efforts need to be evaluated not only in terms of the social good they achieve but also the economic benefit they reap for the donor (Agrawal & Sahasranamam, 2016; Carvalho, 2017; Zaefarian et al., 2015). Furthermore, the dominant role donors play is emphasised, especially in deciding which recipients to invest in and the criteria for evaluating whether they are the right fit or not (Baur & Palazzo, 2011; Hine & Preuss, 2009). However, literature remains silent on how these evaluations might be measured.

Recipients expressed the need for a balance between the needs of the donor and that of the community they serve and, although they achieve the outcomes as required by the donor, these are often interrupted and influenced by external harsh realities. A lack of understanding and sensitivity to situational realities has an influence of how results and outcomes are perceived and understood by donors. This is reaffirmed by literature which states that measuring and reassessing the needs and expectations of both parties allow for progress and in many cases increased innovation and impact (Hemingway, 2010; Jamali et al., 2011; McDonald & Young, 2012).

Implications and Conceptual Framing

It has been argued that strategic alignment is a possible solution to bridging the divide between donors and recipients in the CSR process (Agrawal & Sahasranamam, 2016; Austin & Reficco, 2009). However, research remains relatively silent on a practical solution which demonstrates how this alignment might take place (Porter & Kramer, 2006). While the traditional Business Model Canvas highlights the process of how a company would go about creating, developing and delivering value to a specific target market, the CSAC outlines the journey that donors and recipients would undertake in the grant-requesting and grant-making process. Additionally, it answers the question as to how a strategically aligned and practical model that moves CSR towards CSE might also help donors and recipients in their pursuit of an accelerated and positive social and economic match. Each category within the CSAC is representative of the findings. Furthermore, it places into focus the obstacles and enablers that donors and recipients need to address. This process needs to be carried out independently, and then jointly, so as to develop a cohesive match that is strategically aligned in nature. Frequent interactions and alignment thereof should lead to positive outcomes for both the corporate donor and the recipient. The CSAC supports the research conducted by Tracey, Malnight, and van der Graff (2009) who argue that for business and society to reap mutual benefits, donors need to engage with community-led recipients in a consultative manner.

The current research argues that adopting the core principles of CSE (Austin et al., 2013; Hemingway, 2005a; Michelini & Fiorentino, 2012; Zhang & Zhang, 2016) as well as discussions and evaluations via the CSAC will lift both parties to greater levels of strategically aligned CSE processes which in turn will have a greater impact on the donor, the recipient and society as a whole. The proposed model equally addresses Hadad and Cantaragiu’s (2017) suggestion that in order for CSE to succeed it will require a vehicle that is flexible and multifaceted.

A further observation, in relation to the research findings and emergent conceptual model, was that the term ‘strategic alignment’ was used and applied in a vague sense by the donor and the recipients. Literature also readily uses the term without going into deep levels of enquiry as to what it practically entails as a process (McElhaney, 2009). While the concept of strategic alignment within the field of CSE has not fully emerged, for the purposes of this study the notion of strategic alignment is linked back to an integrated partnership, higher levels of connectivity and mutually beneficial worthiness of a cause (Jamali et al., 2011). Considering the theory on which the current research is found, it can be argued that strategic alignment is a collection of categories which need to be discussed, reviewed and evaluated by both the donor and recipient separately and then again collectively. The reasoning for this is to gauge whether there is a suitable match between the two parties for CSE projects and to highlight areas of concern which might have either been overlooked or assumed. While Porter and Kramer’s (2011) notion of shared values plays a role in the CSE arena, the findings of the current study suggest that there is greater complexity regarding the grant-requesting and grant-awarding process in the CSE field. The research findings highlight how existing CSR practices are largely transactional whereas CSE and the proposed CSAC focused on continuous engagement in order for both entities to achieve a ‘win–win’ scenario. The conceptual model suggested by this research posits that numerous opportunities lie in the use of a model which focuses on practical steps towards identifying a suitable match between donors and recipients; aside from positively impacting the recipient and their specific community-focused programmes, there is also the potential for new developments to emerge which could have a financial benefit for the donor. This links directly to the literature which identifies the benefits of CSE such as social legitimacy, new market opportunities and innovative collaborations (Agrawal & Sahasranamam, 2016; Austin et al., 2013; Zaefarian et al., 2015).

In order to achieve a strategically aligned match and cohesive fit which leads to mutual sustainability and impact, donors and recipients need to follow a practical step-by-step grant process. This process, as indicated in the resultant theory via the CSAC, should guide them as individual entities and then again as a collective group.

The current model is conceptual and therefore an opportunity exists for future research to be conducted on the validity of the model, the respective categories and the correlation between donors and recipients.

Conclusion

The current research findings address the need for a practical process and model for CSE that takes into consideration shared values and strategic alignment. Furthermore, the research posits that, from a South African perspective, the practice of CSE, using the emergent CSAC, would be a more robust and practical approach to existing CSR practices that have often placed the corporation in the driving seat when it comes to grants. The CSAC takes into consideration the success of the Business Model Canvas and endeavours to act as a visual tool that facilitates understanding, dialogue and the sharing of ideas so that a common ground between donors and recipients can be found.

Identifying and evaluating the expectations of both the donor and recipient, at the start of the CSE process, are important when assessing the potential cooperation and match between the two entities (Calton et al., 2013). The current research addresses Porter and Kramer’s (2006) need for a strategically aligned process whereby both donors and recipients benefit, as well as the need for a practice which puts a halt to potentially continuous cycles of inequality and piece-meal donor-driven practices (Baur & Schmitz, 2012).

While the current study compliments the works of Porter and Kramer (2006, 2011), the research indicates that there are substantially more elements which need to be in place before existing CSR processes can mobilise towards successful CSE activities and processes; hence the development of the CSAC which emphasises the emergent categories from the research findings.

Footnotes

Declaration of Conflicting Interests

The authors declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.

Funding

The authors received no financial support for the research, authorship and/or publication of this article.

ORCID iD

Karen Hidden

Jonathan Tresman Marks

Appendix A: Corporate Social Alignment Canvas

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Misaligned Needs in the Pursuit of Shared Value: A Multi-Stakeholder Study of the Shift from Corporate Social Responsibility to Corporate Social Entrepreneurship in an Emerging Economy

Abstract

Abstract

Keywords

Introduction

Overview of the Literature

Corporate Social Responsibility

Corporate Social Entrepreneurship

Strategic Alignment and Shared Value

Methodology

Research Sites

Data Collection

Limitations

Results and Findings

Categories

Goal and Vision Alignment

Strategic Intent

Communication

Value Creation

Relevance and ROI

Harsh Realities

Sustainability and Impact

Monitoring and Evaluation

Discussion

Goal and Vision Alignment

Strategic Intent

Communication

Value Creation

Relevance and ROI

Harsh Realities

Sustainability and Impact

Monitoring and Evaluation

Implications and Conceptual Framing

Conclusion

Footnotes

Declaration of Conflicting Interests

Funding

ORCID iD

Appendix A: Corporate Social Alignment Canvas

References