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To: David Oskandy
From: Max Drickey
cc: Laurent Masson
Date: April 15, 2015
Re: Envisioning a Corporate Citizenship Program for Avanade
While corporate social responsibility programs (CSRs) have existed for many years, an increasing
number of companies have implemented these programs in the last decade. These organizations
recognize that CSR programs improve their: (i) reputation, (ii) competitive advantage, (iii) ability to retain
and attract current and prospective employees, clients, customers or users, and (iv) relationships with
suppliers, governments, and communities. Importantly, CSR programs foster cooperation and team spirit
within an organization’s workforce, reinforce the messaging behind an organization’s code of conduct,
and empower a company’s employees to take an ownership stake in the wellbeing of their community
and their company.
To date, industry leaders, including technology giants like Intel and Microsoft, have established some of
the world’s most recognizable CSR programs. But companies in all industries and of all sizes have
created successful and impactful CSR programs. Accordingly, smaller professional service providers like
Avanade can make substantive contributions to their communities through targeted initiatives that
leverage core strengths and values of the organization. By evaluating the CSR programs of some of
Avanade’s competitors as well as the programs of other organizations that are similar in size and
earnings to Avanade, Avanade can “cherry pick” from these CSR programs to construct its own
customized CSR program that reflects its culture and values.
This memo should be reviewed in tandem with the Corporate Citizenship Comparison excel spreadsheet
previously provided.
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Methodology
Creating a Matrix of Characteristics for Sample CSR Programs
To gain an understanding of how Avanade might construct its own CSR program, I researched
comparable programs of other organizations to learn about the various types of arrangements that a CSR
program could take. Given the enormous variety of CSR initiatives seen in the marketplace, I employed
the following criteria to refine my research efforts, and to compare them against Avanade’s resources,
strengths and priorities:
Size – The number of employees and net revenue of organizations were considered. Although
company size does not necessarily dictate the scope or size of an organization’s CSR program,
an organization’s revenue and workforce serves as a useful standard by which to assess the
applicability of particular types of CSR initiatives to Avanade’s unique conditions and corporate
environment.
Industry – Only organizations that focused on the creation of information technology products or
services or the creation or management of information assets were considered. These
companies typically share a pool of marketable skills.
Eminence – Only CSR programs that have been recognized by the Ethisphere Institute, a non-
profit organization that annually identifies the world’s most ethical companies, or by CSR program
subject matter experts1,2 as being impressive were considered.
Maturity – Only programs that have been operated successfully for more than 10 years with the
support and sponsorship of the parent organizations were considered.
Source Material
To learn more about CSR programs, I examined the content and materials provided by the sources
described below:
The Conference Board – An organization that provides reports and surveys detailing the types
of CSR programs available to companies at various sizes and capacities, and outlines the
preliminary steps necessary to start those programs.
The Organization for Economic Co-operation and Development – An organization that
provides reports that identify more unconventional ways of expanding a company’s CSR
initiatives at an international level.
1
Benjamin Weinberg is theprobonopartnerat Dentons, managing thelaw firm’s substantialpro bonoprogram.
Prior to his employmentat Dentons, he servedas thechief of the Illinois AttorneyGeneral’sPublicInterest Division,
overseeing major litigation in the publicintereston such issuesascivilrights, disabilityrights, and publicutilities.
2
Deb Krause servesastheSteeringCommittee Chair of Mercer’sGlobalCommunity Caresfoundation. She was
previouslyemployed at UnitedHealthGroup astheDirectorof theOffice of SocialResponsibility.
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Boston College Center for Corporate Citizenship – An organization that provides data on the
benefits of CSR programs to businesses and provides information about the current state of CSR
initiatives.
Points of Light – An organization that provides information on economy-wide challenges to
improve CSR initiatives, and supplies basic resources useful to establishing a CSR program
within an organization.
Subject matter experts – Experienced individuals who have created or managed several CSR
programs within multiple organizations and industries shared experience and know-how. These
SMEs identified “best in class” CSR programs and other information and resources for research
and comparative purposes.
Websites of existing CSR programs – Websites of the established CSR initiatives of
companies that describe these programs enabled me to understand the various CSR
programmatic approaches. Some website provide knowledge-sharing content to assist
organizations create new CSR programs (e.g., Salesforce Foundation).
Types of CSR Programs:
At the most basic level, CSR programs differ from company to company in the way that they support and
interface with non-profit organizations:
Financial contributions – The CSR program facilitates the donation of financial resources to
non-profit organizations directly or promotes employee donations via a matched contribution
program.
Volunteering – The CSR program coordinates with non-profit or needy organizations to establish
days of service (e.g., P.A.D.S. Lunch Program, cleaning parks or public spaces). Simple
volunteerism is rewarding, team-building, and reflects favorably on the company in many cultures,
positing a down-to-earth “just folks” public image of the company without a huge commitment of
company resources beyond manpower.
Skills-based volunteering – The CSR program coordinates with non-profit or needy
organizations to provide pro bono services (e.g., managed services to public schools, the
development of software to help women’s shelters). Skills-based volunteerism suggests a
company with a deep commitment to the community and can provide more value to the recipient
party than simple volunteerism since a more complex set of services can be donated.
Partnered programs – The CSR program coordinates with existing business partners to provide
joint donations or skills-based volunteering to non-profit and needy organizations through jointly
sponsored social responsibility initiatives (e.g., provision of Microsoft software and technology
implementations to non-profits). When both organizations share similar corporate cultures and
goals, partnered social responsibility initiatives can produce positive and far-reaching results
through shared efforts.
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Structure and Operation of CSR Programs:
CSR programs vary structurally, both in how they align to the business strategy of the company, and in
how they are managed. An organization may find that a CSR program that reflects its corporate
structure, operation, and culture will be easiest to develop and deploy.
There is no “one size fits all” approach to creating a successful CSR program -- successful programs are
tailored to the organization and strengths of the company. While some programs are structurally or
operationally better suited for larger or smaller companies, and some programs are best aligned with
particular industries, the form of an organization’s CSR program ultimately depends on an organization’s
corporate culture and structure. Listed below are alternative structural and operational models for CSR
programs:
Structural Models:
a) Corporate giving – Financial donations or in-kind goods and services are planned as an
expense during the company’s annual budgeting process and funded with pre-tax income.
Because money flows directly from the company to third party organizations, corporate giving
can resemble normal business transactions that serve the company’s business interest.
Thus, while corporate giving proves the easiest, most direct way to serve communities, some
cultures may interpret the practice as disingenuous.
b) Global corporate foundation – Social investments are channeled through a private charity
foundation, established by the company and managed as an autonomous organization.
Because the company does not receive any direct business benefit from the foundation’s
activities, company-specific foundations are often viewed as more authentic signs of
corporate social responsibility.
c) In-country corporate foundation – Domestic foundations serve ostensibly the same function
as an international foundation, but convey a strong sense of corporate responsibility at the
domestic level. Establishing separate foundations in multiple regions can prove time
intensive, however.
d) Some combination of the above
Operational Models:
a) Centralized – The CSR program strategy and budget are decided and managed at company
headquarters. Centralization predicates operational simplicity, but runs the risk of
disempowering employees from getting involved in the program in a meaningful way.
b) Decentralized – Each company location is responsible for defining its own strategy and
managing its own budget. Empowering offices to control scaled CSR initiatives yields more
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efficient programs that address the interests of employees and their community. However,
the decentralized approach can be difficult to standardize across the company.
c) Strong regional management – Each region is allocated a budget and expected to pursue
initiatives defined by management at the local level. This “middle-ground” between
centralized and decentralized approaches allows for a unified direction for social
responsibility initiatives while providing reasonable autonomy for individual offices in their
approach to CSR.
Supplementary CSR Initiatives:
Organizations can demonstrate their commitment to corporate social responsibility in ways that do not require a
formal CSR program. These CSR “best practices” are not intended to replace comprehensive CSR programs,
but rather, can be used to augment established CSR programs.
Ethics Policy – Updating a company’s ethics policy to ensure that it reflects an express commitment to
community service as an integral part of its ethical foundation.
Multi-stakeholder initiatives – Collaborating with social partners (e.g., worker and employer
organizations, NGOs, other companies) to address specific CSR issues like good business practices
(e.g., anti-bribery) or sustainability practices (e.g., waste reduction).
Certification and labeling – Submitting to auditing by accredited third parties and remediating areas of
noncompliance in exchange for positive and marketable certifications.
Sectorial initiatives– Supporting sector or industry-wide initiatives that seek business solutions to
socioeconomic challenges (e.g., retail stores creating infrastructure to support and assist manufacturers
in Asia to upgrade facilitates to comply with better building codes). These may involve management of
the company’s supply chain and cooperation with its downstream suppliers.
International Framework Agreements– Negotiating with national trade unions and global union
federations to create agreements that pledge that company standards are applied consistently on the
global scale within the company and within the company’s partners.
Initial Stepsto CSR Program Development
In reviewing written resources and conferring with subject matter experts, I learned that a successful CSR
program requires the support of the program at the highest level. Without executive backing and involvement,
good corporate CSR intentions can wither on the vine. Subject matter experts advocate identifying and building
upon the personal philanthropic interests of Board members and company executives as an effective strategy to
commence a CSR program build. By starting with a small and targeted CSR initiative that has executive
support, a company can use the success of this initial effort to evolve and grow into a larger CSR program.
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Perhaps the biggest danger for any small company, including Avanade, is the well-intentioned desire to meet
overambitious goals in unrealistic timeframes. Once a company has outlined a proposed business plan that
addresses the desired structure, operation and goals of its CSR program, the company should pilot the program
in a single office to understand strengths and weaknesses of the program and to make any necessary fixes
before the program is deployed on a larger scale. The SMEs with whom I spoke suggested that, to assist in
assuring the best-case outcome of the initial phases of a company-wide CSR program, the best performing,
best managed office should be the site of the trial program.
After successful deployment of the initial phases of a company-wide CSR program, a company can establish
goals and objectives for its CSR program growth. One such goal is the “1/1/1 Model.” Established by
Salesforce.com founder Marc Benioff and adopted by numerous technology companies, including Google, the
1/1/1 Model calls for the annual donation of 1% of company equity, 1% of company profit and 1% of employee
hours to charitable causes.
Ultimately, there is no single approach to creating a successful CSR program – CSR programs take all forms
and sizes depending on the industry, size, goals, and resources of the organization. My research suggests that
Avanade should identify a limited number of goals that enjoys executive sponsorship and has synergies with its
corporate culture, start small, and pilot a program in one or two of its offices. Replicating the successful parts
and remediating the gaps in the pilot program, Avanade can continue to build and grow a sustainable CSR
program. Avanade’s brand, its workforce, and the community all stand to benefit greatly from the successful
creation and deployment of a CSR program.