Tshikululu: Serious Social Investing workshop LEARNING FROM 40 - PDF document

� �� Tshikululu: Serious Social Investing workshop LEARNING FROM 40 YEARS OF CSI By Godfrey Gomwe Good afternoon ladies and gentleman. Thank you for the privilege to address you. This afternoon I would like to:- 1. Give you a flavour of the Anglo American strategy and how it relates to CSI. 2. Paint a picture, specifically, of the history of the Chairman’s fund. 3. Outline some examples of the Chairman’s Fund work and, in the process, highlight the reasons for success. 4. Finally, a view of the future and the next 40 years, before closing. Background and Strategy of Anglo American Anglo American is one of the world’s largest diversified mining groups and our ambition is to be the leading global mining company. We believe that our primary purpose is to provide our shareholders with sustainable returns above those of our direct competitors. This has been best achieved over the long term by earning unparalleled trust and commitment from our employees and partners, who include governments, communities, customers and suppliers with whom we work. The words ‘leading global mining company’ implies that we have to be, and remain, the investment, partner and employer of choice. In line with this philosophy of investment and partnership is Anglo American’s corporate social investment, or CSI. The Group has a long and distinguished CSI history, dating back over 40 years, and has put in place CSI initiatives long before any other mining company deemed it necessary, appropriate or fashionable. The initiatives put in place by Anglo American predate any enforced current day legislation. Today, Anglo American is still South Africa’s largest supporter of CSI, working closely with the government and other stakeholders to create a better future for all. Central to this CSI framework has been the Anglo American Chairman’s Fund, which has emerged as the first professionally managed CSI fund in South Africa. Over the years, the fund has undergone the sort of organisational and structural change that could be expected of a dedicated initiative to social change, in a company founded during the Great War. �

� �� The ideas that propel the current Fund are mere refinements on a long held philosophy at Anglo American. This philosophy takes the long view of development much the same view that we take within our operations by recognising potential and talent in the actions of select individuals and community champions, listening to these, and then partnering to the greatest positive effect. Its ethos is best summed up through the words of Anglo American founder Sir Ernest Oppenheimer, who in 1954 said that the purpose of the company is to make profits for its shareholders, but to do so in a way that makes a real and lasting contribution to the countries and communities in which it operates. Anglo American’s thinking behind undertaking and supporting social responsibility projects is, therefore, not to obtain goodwill or credit or publicity but to produce an actual beneficial social result. Nothing is more important in the administration of this fund, than an adequate measure of humility or recognition and not only does it not necessarily know best, but that many people may know better than it did, and that those closest to the problem, and those actually working in the field were the most likely to have the best vision. History of the Chairman’s Fund There has always been a Chairman’s Fund in Anglo American since the Corporation was founded in 1917. It seems unlikely however, that the Fund has actually existed under this name for that long, although contributions to charitable endeavours have been noted throughout the company’s history. We are aware of the existence of a “Chairman’s Fund” from at least the late 1950s, although it may have worked under a different title in the early Sixties. From Margie Keeton’s unpublished De Beers in South Africa – a socio-political history, 1888 – 2006 , one derives much important information to note. In 1967, the social investment activities of De Beers were merged with those of Anglo American under an entity called the Group Chairman’s Fund, administered by a committee of senior executives from Anglo American and De Beers. By 1971, total contributions of the Fund had grown to R1.4 million. Also revealed in the book is that in 1974, contributions were increased by 60% to enable the Fund to initiate more substantial projects in fields such as education and social services. In coming to this decision, it was the view of corporate leadership that in expanding its operations �

� �� the Fund should concentrate on the development needs of Black communities in urban and rural areas, with special emphasis on education and improved standards of living. In the Anglo American 1973 Chairman’s Statement , Harry Oppenheimer, son of Ernest Oppenheimer, provided background to the Chairman’s Fund. He noted that the policy of the Anglo American group has always been to support, on a substantial scale, charitable causes both in the narrow sense and in the broader fields of education, culture and social services. Therefore, it was both logical and sensible that further parts Anglo American’s profits should be invested in endeavouring to conserve and improve the social environment in which the company would operate in the future. Further, noting the social change in South Africa, Harry Oppenheimer expressed the view that the time was ripe “to do more in this field, and to do it in a new way” . The ‘new way’ was to bring impressive results. Buoyed by the dramatic rise in the gold price and a favourable tax regime for donations, contributions from the Group’s gold mines to the newly-named Anglo American and De Beers Chairman’s Fund soared during the late 1970s, putting in place the funding for it to contemplate very large capital projects. Many of these changed the face of South Africa, creating important new facilities for individual development at a critical time. During these years the company recognised the important strategic opportunity that was created, whereby the economic imperative for skilled labour and settled communities was exposing the internal contradictions in apartheid. This created the conditions in which new educational projects challenging the parameters of racial segregation and inequality could take root. Sadly, not all the innovative projects initiated by the Fund have survived testing times of social upheaval and political change. However, for a time, they were powerful beacons of hope, highlighting some of the next steps on the uncertain path to a shared future. Some examples …. How? The Fund’s most notable monument is the Mangosothu Technikon, the first facility to provide advanced technical training for Black students in the country’s industrial heartland. It is now part of the fabric of higher education, and few remember its origins as a privately-funded venture, supported by the Anglo American and De Beers Chairman’s Fund with finance. �

� �� Other firsts included the Teacher Training College in Soweto, and several schools that pioneered models of multiracial or accelerated education, far ahead of their time. These included Uthongathi School in KwaZulu-Natal, the Schools of the Resurrection in Johannesburg (R50 million in current money) and All Saints College in the Eastern Cape. The Fund also supported the construction of the first major home for disabled Black children in South Africa. This ‘new way’ also entailed dedicated management and purposefu l social investment, undertaken with care and sensitivity to the individual realities of each project. Over the years, what singled the Anglo American and De Beers Chairman’s Fund out from others in the field was its thoughtful approach and its deep understanding of the developmental realities in a changing South Africa. The Chairman’s Fund has evolved over a very considered philosophy of social investment, as well as a willingness to embrace risk and innovation, and bank on the energy and passion of the champions behind selected projects, singled out after careful review. The Fund has also earned a reputation as a helpful donor, willing to listen to and learn from the organisations with which it worked. Critically, it is also important to note that the Fund is no slavish follower of fashion which dictates what kind of NGO will find favour at a given time. Rather, its policies of diversity of donation and its support of breakthrough initiatives to self sustainability have enabled it to serve as a catalyst for a wide range of innovative and far-reaching interventions in social upliftment. The times they are Changing The current Chairman’s Fund, administered by Tshikululu, was born in 1998 owing to the restructuring of the Anglo American group of companies and the subsequent formation of the Anglo American Chairman’s Fund, the De Beers Fund and the AngloGold Fund. Subsequently, the decision was taken for the former Chairman’s Fund team to form a Section 21 company to continue to manage and guide the three new funds, pooling together the vast experience and expertise that has been built up since 1974. So Tshikululu Social Investments was born independent of Anglo American, with a formidable arsenal of vastly talented, multi skilled individuals who became the centre of the Fund’s success for the next decade. �