CSR in rural development

Manila Times.net
MANAGING FOR SOCIETY
BY DR. ANDREA L. SANTIAGO

Perhaps unknown to some, the World Energy Council held last month the 21st World Energy Congress with its conference theme as “Responding NOW to Global Challenges: Energy in Transition for a Living Planet.” It was a well-attended conference with a great majority composed of energy leaders from government and industry. My personal interest in the event was the session on Eradicating Energy Poverty where my co-author and I presented our paper, “A new systems paradigm for the rural electrification program, Philippines.”

A United Nations Development Programme report disclosed that there are over 2 billion people worldwide who live without electricity and subsist below the poverty line. In the Philippines, rural electrification was a priority and as such, in 2009 the country had achieved 100 percent electrification of over 41,000 ba-rangays. Despite the accomplishment, poverty remains endemic especially at the rural level where half of Filipinos reside. Why does poverty persist despite electrification? It is simply because past efforts of policymakers had failed to tie electrification with livelihood.

Acknowledging the deficiency, the Asian Development Bank and the World Bank had begun to rethink their strategies. They now focus their energies to creating livelihood projects, instead of just providing electrification. However, from a systems viewpoint, this link is still inadequate to ensure sustainability and mobilize resources in the magnitude required to make an impact on poverty in rural areas. What is essential is that four elements, not new concepts by themselves, work together for sustainability. This is where industry plays a vital role and the appeal for greater social responsiveness takes its root.

Non-government organizations (NGOs) operating in localities and local government units (LGUs) can design livelihood programs that take into account the realities of the rural poor. For instance, mechanization can help productivity and improve the quality of food produced in a given locality.

Skills training is the next obvious element and this training should include basic equipment maintenance skills. It makes no sense to provide irrigation pumps or mechanized fish drying machines that farmers and fishermen will no longer use because they have broken down. It is strange but true. Further, the beneficiaries should identify a trainable project champion who can sustain the enthusiasm and commitment. The idea is to remove the responsibility of the project away from NGOs and LGUs so the beneficiaries take responsibility for their livelihood. Guidance however comes from companies willing to take rural development projects as part of their corporate social responsibility (CSR) agenda.

A key element to the success of rural projects is the introduction of sound management and the establishment of secure markets. In effect, companies can collaborate with the rural poor by including them in the value chain. Two examples of such endeavors are that of Figaro Coffee and Binalot. 
Essentially, CSR efforts move out from the notions of corporate donations to business partnership. This has the effect of providing dignity to the beneficiaries who can now steer away from the entitlement attitude that society should take care of them.

But rural electrification is still at the core of this paradigm shift. Instead of electrifying households, governments should focus on electrifying enterprises. Taken together, this should help address rural poverty.

Dr. Santiago is an Associate Professor at the Business Management Department of De La Salle University where she teaches Corporate Social Responsiveness, Leadership in Organization, Family Business Management, and Human Resource Management. E-mail: ma.andrea.santiago@dlsu.edu.ph