In the last five to ten years, mining companies have adopted a more strategic approach to social investment, says Tshikululu Social Investments CEO Tracey Henry.

She adds that many mining companies no longer view corporate social investment as a soft function and incorporate social investment strategies into their overall business strategies, which is encouraging.

South Africa has a long history of mining companies that have invested in communities in the broader context of development issues, she says, adding that, when the mining industry boomed in the 1800s, companies like De Beers and Anglo American did do their part for social development, even before legislation was passed.

“The major players in the mining sector – whether they are mining companies, government or unions – have a vested interest in creating a competitive sector. In the case of the mining sector, this goes beyond financial performance, paying taxes and creating employment. The mining sector and unions have demonstrated a commitment to contribute to societal transformation, which includes interventions in education, health, sustainable livelihoods and youth development,” she states.

A research paper produced by Tshikululu in 2012, titled ‘The Labour Union Investment Landscape’, highlighted that, since 2008, the National Union of Mineworkers – as one of the unions researched – contributed close to R250-million towards educational, skills and community development interventions.

Based on the research, Henry states that this is by far the largest investment made by any union the past few years towards societal transformation. Other unions have also contributed in meaningful ways.

According to another study that Tshikululu conducted this year on the value of social investments for companies, most JSE-listed companies stated that, despite pressure from government and regulators to invest in social initiatives, they would have invested regardless of legislation currently requiring them to do so.

Henry believes that business leaders recognise the benefits of social investments and that by creating a more stable environment it benefits South Africa.

For example, education is of national interest and is viewed by many as the apex of development. The mining sector recognises the significance of investing in education, particularly in terms of the future pipeline of employees, scarce skills in areas such as engineering, but also support for current employees.

Henry states, however, that the education backlog is significant and that only 45% of learners that enrolled for Grade 1 in 2001 having completed Grade 12 is a point in case. The quality of passes, as well as the number of Grade 12 learners achieving a maths pass of 50% and above, is declining.

“The mining sector needs to continue to invest in education, as well as broader development issues that build the social fabric of society, such as food security, job creation and [the elimination of] gender-based violence. Some might argue that it is the role of government, but the reality is that we all need to play a role. When we convert money into social value, we will yield dividends,” she says.

Tshikululu acts as a bridge between what corporations are trying to achieve from a social- investment point of view and what nonprofit organisations are similarly doing, which creates a partnership that provides opportunities for both parties. A key role that Tshikululu plays in this regard is monitoring and evaluation, focusing on outcomes and impacts as opposed to inputs.

Henry says partnerships are important, as no corporate in South Africa can be successful on its own or expect a sustainable financial dividend without investing in social dividends.

She adds that partnerships should be based on clearly articulated needs and a willingness to work together. The National Development Plan, for example, provides an important platform for the mining sector and government to collaborate and address specific needs identified by the National Planning Commission in its Diagnostic Report.

Government alone will not succeed in realising this vision and it depends on business and civil society to move from a plan to implementation.

Further, there needs to be an incentive or mutual benefit for partnerships to be successful. Partners should work towards a win-win situation and be content with compromising and gaining during the process. However, if one partner wields excess power over the other, the partnership will break down.

“Partners also need to agree on clearly defined outcomes, which must be subjected to rigorous, ongoing review and evaluation. Many partnerships fail because there isn’t a mutual understanding of what success will look like. Also, risks are not identified upfront and the red lights only flicker once failure is inevitable. To mitigate risks, partnerships should be independently monitored and continuously evaluated to ensure that projects stay on course and, when things do go wrong, corrective measures can be agreed upon and implemented,” she advises.

It is important for companies to demonstrate through their actions that they are trustworthy, dependable and credible partners.