In addition to charity by the general run of people, the corporate heads and their business groups are in the forefront in dishing out generous donations in cash and kind. In 1998 a research on corporate giving found that 93 percent of 120 premier business companies were pursuing philanthropic activities. The corporate philanthropy which is considered extrapolation of corporate social responsibility shows consistently an upward trend in quantity, quality and variety. It is inspired by altruism and a sense of socio-religious obligation, and motivated by a desire to extend a helping hand to the government, civil society and non-profit sector in charitable pursuits and social development.
In Pakistan philanthropy differs from corporate giving around the world which is mostly pursued as a marketing strategy to promote companies' image and credibility in highly competitive business environment. It is not so in Pakistan where corporate foundations are merging business and social strategies as they believe that the interests of society and business should have equal weight in their decisions. The business leaders are looking at themselves more as corporate citizens who are not only engaging with social stakeholders but deem themselves as stakeholders alongside government and civil society in addressing social issues. The companies now consider their contributions more as investment in social development than charity.
The financial support by businessmen in our context stems from the premise of spreading prosperity across the whole spectrum of society as it is believed that oases of development would not make an impact if the oceans of social challenges around are not reduced or eliminated. The business holdings are doing it also by providing hundreds and thousands of jobs and taking care of employees' wellbeing and the environment. The businesses are thus emerging as key game changers in social development and crucial partners of the government and non-profit sector through deploying all possible corporate muscle to fill the philanthropic space. This role which is often under-reported is in fact the bedrock of country's resilience in the face of socio-economic challenges and natural calamities.
A latest survey of fifteen years (2000-2014) published by Islamabad-based Pakistan Centre for Philanthropy (PCP) on 'Corporate Philanthropy' revealed that public listed companies (PLCs) constituting only one percent of the entire corporate sector donated around Rs six billion in 2014, the highest in any year rising by 26 percent from Rs 228 million in 2000. The study launched on 7 February 2017 found that 54 percent PLCs active in corporate giving contributed Rs 34.5 billion during one and a half decades. These figures neither take into account in-kind and in-time donations, nor reflect un-reported donations. Another research by PCP for the year 2015 covering public listed and unlisted/private companies showed a contribution of Rs 1.8 billion by small sample of public unlisted and private companies (33 to 35%) inflating the total donations to Rs 7 billion - around 30 times growth since 2000.
According to the Centre, corporate philanthropy in 2014 exceeded government's public sector development program budget for expansion of college education. The donations coming from business foundations were calculated to be more than twice the amount of Rs 2.3 billion allocated by the government to improve human development indicators in the country.
Let's take the example of Nishat Group whose PLCs with impressive track record of social responsibility are among top 25 companies identified by PCP survey on the basis of absolute volume of donation and percentage of profit-before-taxation (PBT) donation. The share of total donations of these top 25 companies spiked to 83% in 2014 from 69% in 2000. In order to study business sector's role in philanthropy, Nishat Group with a vast array of commercial interests from textiles to banking and from retail commerce to power generation is a suitable model that is arguably representative of corporate community. The Group's companies are part of the leading 20 sub-sectors ranked by PCP study including commercial banks, cement, electricity generation, textiles and insurance companies. The Group's chairman Mian Muhammad Mansha is one of business personalities who have taken corporate responsibility way beyond its traditional mandate by integrating it in business philosophy.
The corporate giving and its relationship with the public and nonprofit sector are evolving in Pakistan. This area has yet to find recognition in public policy. "Government's limited financial capacity and feeble policy response to capitalize on available philanthropic response in corporate sector have resulted in sustained deficit in social sector", says the PCP study. It should be any Pakistani's hope that in the backdrop of ingrained edhisim in the nation, the government acknowledges the game changing role of corporate leaders in achieving national development agenda and SDGs set by the United Nations. Launching PCP report early this month, President Mamnoon Hussain laid emphasis on public private collaboration for maximising the dividends of philanthropy. Previously in 2015, Minister of Planning, Development and Reform Mr. Ahsan Iqbal proposed that management leaders in private sector may extend helping hand to the government. There is no lack of desire and enthusiasm in the latter in that direction. It is now for the government to devise mechanisms for sustainable partnership for social development between itself and the entrepreneurs.
(The writer is an Islamabad-based free lance contributor)
Copyright Business Recorder, 2017