Putting people at the centre of everything we do

The social investment landscape has become more complex, with a greater emphasis on impact measurement, management and reporting.

The strategic allocation of social investments plays a vital role in contributing towards a more equitable, prosperous and harmonious society. As a leading South African social investment fund manager and adviser, Tshikululu Social Investments has over the last 25 years influenced the evolving social investment landscape to ensure that the investment of funds in communities results in positive outcomes.

“What has changed significantly since our inception in 1998 has been the professionalism of the sector and the skills and expertise required to ensure the effective management of social investment funds. This has been mostly driven by the increased complexity and stringent governance frameworks, as well as factors such as the licence to operate requirements and, more recently, ESG and a greater focus on embedding sustainability principles across the business environment,” says CEO Tracey Henry, who has been at the helm of Tshikululu since 2008. She adds that in addition to these considerations, impact measurement and management has become top of mind to ensure that a sustainability lens is applied to all investments.

Despite all these changes in the social investment sector, there are some fundamentals that have not changed, particular from a Tshikululu perspective. “We always put people at the centre of everything we do. Investments are ultimately about improving lives and positive social impact,” she says.

Henry adds that being thoughtful in their decision making and always backing champions has been fundamental to their journey and success, along with never compromising on governance issues and implementing due diligence reviews upfront and managing risks. “Funders can have great ideas but without a solid framework to govern decision making, good intentions can lead to wasteful expenditure,” she says.

Sustainability comes before absolutely everything

Within the context of social impact, the work done by Tshikululu and other players within the social investment space, is all about sustainability, which is core to social impact and needs to be informed by development principles, a clear vision of intended outcomes and continuous monitoring, evaluation and impact reporting.

“There are so many considerations when it comes to sustainability but, for me, the simplest way to think about it is the impact that a programme or initiative is going to have long term in terms of people and communities, our environment and the economy,” Henry says.

Deciding on where to invest, for what period and the funding principles that inform decision making varies across funders. There is no one-size-fits all and understanding the local context and broader sustainability goals is important. While many investors now focus on long term investments, investing in projects in the short term is still important. There are interventions that we are always going to have to support in the short term because that is what is necessary to save lives, to put food on the table and to care for people. The rapid response as a result of the Covid-19 pandemic is a case in point. “But when it comes to education, environment, job creation and livelihoods, we need to think longer term in how and where we invest to create thriving communities. Therein lies the complexity of social investment,” she says.

Henry says that social investors adopt various strategies and developmental approaches and that they don’t all have to be the same. For example, a small funder working with an early childhood development centre in rural KwaZulu-Natal may not be changing the education landscape in South Africa, but can have a significant impact in a specific context to improve numeracy and literacy. A national initiative where you have multiple funders working alongside the Department of Basic Education, as an example, might have a long-term impact on improving learning outcomes and this, too is important.

Different funders having different approaches to impact ranging from grant based to systemic social impact interventions, but all can play a fundamental role in supporting thriving communities.

“Nothing actually matters if there isn’t sustainability and if the focus is not on sustainable and measurable impact,” Henry says, adding more transparency is needed to assess what is happening on the ground. “The focus should always be about impact and how this is defined and the voice of communities in shaping what success looks like is important.”

Partnerships and collaboration

Building partnerships focused on leveraging social investment through financial and other resources to scale impact is one of the investment principles we encourage. In reality, this is hard to achieve. “The only time I can think of where we all really pulled together at scale, irrespective of what sector we play in, was during the Covid-19 pandemic. Corporates, civil society and other social investors contributed in significant ways without consideration for brand. This was a time of many unknowns and we all had a common purpose,” Henry says.

While Covid-19 might not be a priority anymore, we are facing other “pandemics” in South Africa where partnerships can scale the impact of social investments. For example, our youth unemployment rate, our education system and the ongoing scourge of gender-based violence and femicide could all benefit from a similar collaborative response. “Our country is facing numerous crises and we need to pull together,” she says.

Impact at grassroots level

Although there is greater transparency on reporting social impact to key stakeholders, the question that must be asked is what is actually happening at an impact level within the community. How do the initiatives being profiled translate to the child in the classroom, the girl child who is facing challenges at home and the youngster who has dreams about his/ her career?

Beyond the glossy pages, just how authentic is the reporting at an impact level?

“That is where our responsibility comes in, to really ensure that what we are doing is making a positive difference and gives a voice to communities at a grassroots level, to make sure what is reported and discussed at the boardroom table is real and is making a positive impact to our triple burden of poverty, inequality and unemployment, for future generations,” Henry says.