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An understanding of corporate social investment within the context of the Sappi Forest Products Division in South Africa

by May, J.P.

Abstract (Summary)
This research which makes reference to Sappi South Africa is grounded in a South African context, within the forestry industry. The aims of the study are to-

1. Provide a description of corporate social investment (in a Sappi/ South African context) from a theoretical, corporate and legislative perspective which will describe current Sappi CSI activity, its implementation, measurement and the driving force behind them. 2. To articulate a sound understanding without judgement of the current status of corporate social investment based upon the application of (1) above. 3. To position Sappi’s CSI approach on a macro government/ corporate power scale which will facilitate rich understanding concerning the long term sustainability of Sappi’s CSI approach on the corporation, the forestry industry and the South African economy. 4. To distill a consensual interpretation that is more informed and sophisticated than previous constructions within Sappi Forest Products Division.

The qualitative research is descriptive. A single case-study method has been adopted. Corporate Social Responsibility (CSR), as a late twentieth-century American movement, is a modern manifestation of an ancient debate amongst philosophers and theologians in many lands and cultures about the morality of commerce itself (Hood, 1996). Friedman (1962) quoted in Anshen (1980:10) argues that business should not and must not deviate from its profit orientation and that it should be concerned only with its economic performance. Friedman supported the notion ‘the business of business is business’ and adds, as quoted in Smith (1990:60), that to suggest corporations should have a social responsibility is to fail to understand the way in which the market is and must be played and asks, ‘if business does have a social responsibility other than making profits for shareholders, how are they to know what it is? Frederick et al, (1998:36) argue that Corporate Social Responsibility balances power with responsibility, responds to public needs and expectations and can contribute to correcting societal imbalances implicit in most economies.

Smith (1990:89) suggests that the social control of business is achieved by either virtue of moral obligation, market forces and legislation, or, manipulation, inducement and force. Beesley and Evans (1978) quoted in Smith (1990:54) note ‘there is recognition of the growth of corporate power and the consequent perception of relative shift from government to companies as the source of social improvement and the means to promote specific items of social welfare.’ On this basis it may therefore be concluded that societal responsibilities should be shared between government and business, and in this way power balanced and a healthy pluralistic state developed.

The vision of Sappi’s Corporate Social Investment program is to be instrumental in empowering and creating opportunities for both personnel and their dependent communities in order to address their self-defined needs. Sappi’s CSI activity is concentrated on education and community development, environmental preservation and conservation, social welfare and arts and culture. CSI practices are driven by morality, enlightened self-interest and by the South African Government. If the corporation had only started trading in 2005 would the CSI vision be driven by the same ‘gears’, or would the moral obligation and enlightened self-interest become less apparent? It is recommended that the Sappi CSI initiative must embrace CSI and uplift it to the next level by implementing the change management process, outsourcing at least the rural CSI initiative and expanding into a more brand orientated CSI strategy. Sappi also needs to make strategic CSI alliances with other organizations.

Bibliographical Information:

Advisor:

School:Rhodes University

School Location:South Africa

Source Type:Master's Thesis

Keywords:investec business school

ISBN:

Date of Publication:01/01/2006

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