Why Not Invest Your CSI Spend With UKNZ?
Why Not Invest Your CSI Spend With UKNZ?



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Why Not Invest Your CSI Spend With UKNZ?

2017-09-06

The University of KwaZulu-Natal (UKZN) has an established track record of assisting companies and corporates to implement their corporate social investment plans in a measurable and sustainable manner. UKZN is a registered Non-Profit Organisation (NPO) and has Public Benefit Organisation (PBO) status from the South African Revenue Services. In addition, UKZN has recently been rated among the top three research led institutions in the country. Furthermore, the university trains thousands of students in scarce skills disciplines each year, with many of these students being unable to pay for their tuition, accommodation or books.

Your company can donate to the UKZN Bursary Fund via the UKZN Foundation Trust. The UKZN Foundation is able to issue certificates in respect of all contributions received for its Bursary Fund. These will be deductible as a donation in terms of Section 18A of the Income Tax Act. All contributions made to the UKZN Bursary Fund will also qualify for BEE points in terms of the new BBBEE codes of good practice.

Identifying Gaps
Corporate Social Investment (CSI), remains a relatively new concept globally yet it is fast gaining momentum across the world as well as here at home in South Africa. Many organisations have realised that beyond making profits, they are responsible to their various stakeholders and have an obligation towards the improvement of their environment, local communities and ethical practices. This involves implementing well-structured plans of their corporate social initiatives. It is envisaged that these companies would identify gaps within communities before they implement any social initiatives. Planned initiatives generally tend to appropriately promote social harmony, social justice, access and upliftment within a target community.

Four Primary Drivers
It has been estimated that in 2016, R8.6 billion rand was spent on CSI initiatives in South Africa. This is strong evidence that CSI spending in South Africa has seen phenomenal growth within the last decade. Recent research has pinpointed four primary drivers for the incremental flow of resources to the non-profit sector. These reasons are; moral imperative, reputation, the guidelines of the King Code of Corporate Governance IV and the Department of Trade and Industry's (dti's) Broad-based Black Economic Empowerment (BBBEE) codes.

BBBEE Codes
Current trends have propelled business houses to be more proactive and participate in the socioeconomic vicinity. Further-more, the South African government regulation has carved out a unique and explicit role for CSI. As CSI is entrenched in the codes they compel companies to invest 1% of Net Profit after Tax (NPAT) in socio-economic development (SED) initiatives. The recent revision to the BBBEE codes create new opportunities for NGOs and Public Benefit organisations such as public universities to seek support, especially in the skills development space.

The Codes differ from previous legislation in that they include targets for BEE compliance, and progress is measured according to the Scorecard, which has specified targets for each of the five elements. These involve ownership, management and control, employment equity, skills development, preferential procurement, enterprise development and a residual CSI element.

Skills Development      
The third pillar of the revised Codes identifies skills development as a priority area and allows companies to claim as many as 20 points. There is a shift in the revised codes for companies to include non-employees in their skills development plans. A high target of 6% of payroll needs to be spent on training, in order to achieve maximum points for skills spend. Companies may struggle to spend this on their own employees.

NPOs such as UKZN, can offer another avenue for spending on the development of black people who are not employees of the company in the form of bursaries, learnerships, internships or apprenticeship programmes.

Donations
To donate to UKZN visit our website at www.foundation.ukzn.ac.za or email us at foundation@ukzn.ac.za and one of our experienced Development Officers will contact you to discuss how UKZN could support your CSI spend.




Why Not Invest Your CSI Spend With UKNZ?

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