For companies with high social and environmental impacts, success is tightly linked to the sustainability of the regions in which they operate. As they pursue regional sustainability, companies are learning that short-term, transactional relations benefit neither their business nor the communities over the long term.
A New Model for Community Relations
Collaborative community development is a model for companies to create shared value and develop healthy, long-term relationships with their stakeholders. This approach has three main characteristics:
collaborative governance, which requires diverse stakeholders to participate in project definition, development, and management;
involvement of many companies, including competitors, working together; and
long-term focus on a territory, rather than short-term focus on specific stakeholders.
Collaborative community development provides companies with a clear and effective structure for involvement in sustainable development. The results benefit business and community.
Collaborating for Sustainable Growth in Chile
This guide is based on extensive research on two case studies in Chile. One case examines the Chilean city of Antofagasta, which experienced explosive economic growth as a result of a mining boom. But, this success led to pressure on services that the city was unprepared for. Compromised transport, services, and quality of life not only burdened the local community, but challenged companies in their efforts to draw on and retain talented workers, who saw the city as unattractive.
After conventional CSR attempts failed, a large mining company in the area initiated a collaborative community development effort that would systemically address the socio-economic impacts of the mining boom and the living experience for workers. The company built an alliance with local government and 12 other companies from various sectors. The alliance invested in high-quality participatory forums to engage the entire community of Antofagasta.
This initiative, Creo Antofgasta, developed a portfolio of long-term projects to promote the city’s sustainable urban development, focusing on seven areas of action including land use & growth, public space & green space, and economic diversification.
Collaborative Community Development vs. Conventional Approach
The chart below details how collaborative community development differs from traditional corporate community relations efforts.
Traditional Community Relations
Collaborative Community Development
Each company operates its own community relations plan.
Collaborative governance engages diverse stakeholders in project definition, development, and management.
Interaction/Bond with Community
Companies have transactional interactions, resulting in an instrumental, fleeting bond with communities. E.g. "I give you something; you accept me."
Companies establish constructive, massive, and repeated collaborative interaction, creating a lasting bond.
Projects are short term, usually one year long, consistent with each company's annual planning cycle.
Companies commit to a constructive, massive, and repeated collaborative interaction with a long-term focus.
Companies have relationships with individual stakeholders, based on a business risk analysis.
The core relationship is between multiple companies and the territory, which is analyzed as a whole system.
A New Governance Structure
Collaborative governance is implemented with a high-level governing body that functions as a “board” and usually includes representatives from government, the private sector, and the community. A collaborative intermediary organization (CIO) manages the day-to-day activities of the collaborative initiative and project portfolio.
Figure 1. The Collaborative Intermediary Organization's Coordination Role
What's Included in this Guide
This guide draws on extensive research to help you chart your journey with collaborative community development. The guide explains when collaborative community development is appropriate, and provides detailed guidance on how to implement it. Case studies of other companies' experience illustrate the concepts.
Who Should Read this Guide
This approach is particularly relevant for companies that
operate in a community with significant development needs
share a territory with other companies
have significant social and environmental impacts.
Managers seeking to strengthen their communities and increase their firm's social legitimacy will find this guide valuable. Community stakeholders who wish to work with businesses on sustainable development will also find useful tips on how to make their initiatives successful.
About this Research
This research was inspired by the Leadership Council of the Network for Business Sustainability Chile (CBS). NBS Chile is Network for Business Sustainability (NBS) hub for Latin America. The report is an extension of larger empirical research authored by Dr. Verónica Devenin, at the University Adolfo Ibañez (Chile), with guidance from members of the CBS Leadership Council.