June 19-20, 2013 Dr . Yılmaz Argüden, Chairman , ARGE Consulting , Chairman , Rothschild, Türkiye

1. CORPORATE SOCIAL RESPONSIBILITY IN THE MIDDLE EAST The role of business consulting in promoting CSR in Türkiye and in the region June 19-20, 2013 Dr. Yılmaz Argüden, Chairman, ARGE Consulting, Chairman, Rothschild, Türkiye

2. What is Corporate Social Responsibility? • Human Rights • Employee Rights • Equal Opportunity • Training and development opportunity • Transparency & Accountability • Economic development • Anti - corruption • Value creationg and paying taxes • Eco - Efficiency • Development of new technologies for clean environment • Minimizing environmental footprint

3. Sustainability and Good Governance in four perspectives Economic Society Environmental Individual Corporate NGO Public

4. NGOs • A nonprofit organization is formed for the purpose of serving a public or mutual benefit other than the pursuit or accumulation of profits for owners or investors. • "The nonprofit sector is a collection of entities that are organizations; private as opposed to governmental; non-profit distributing; self-governing; voluntary; and for public benefit" • The nonprofit sector is often referred to as the third sector, independent sector, voluntary sector, philanthropic sector, social sector, tax-exempt sector, or the charitable sector. • NGOs main target is to insure both sustainability and socially impact, which is done through creating a sustainable mission-based, socially responsible enterprise that never compromises its value motive. • Over the last decade there has been a dramatic growth in the number of NGOs involved in various contexts in both developed and developing countries. • The total amount of public funds being spent through NGOs has grown dramatically.

5. The nonprofit sector exists to serve critical functions • Service Provision: Nonprofit organizations provide programs and services to the community. • Value Guardian: Nonprofit organizations provide a mechanism for promoting individual initiatives for the public good. Nonprofit organizations provide a means by which members of a community can take action in an attempt to change the community they live in. • Problem Identification and Advocacy : Nonprofit organizations provide a means for drawing public attention to societal issues. Nonprofit organizations make it "possible to identify significant social and political concerns, to give voice to under-represented people and points of view, and to integrate these perspectives into social and political life" • Social Capital: Nonprofit organizations develop a sense of community among the citizens by providing a means to engage in social welfare.

6. The nonprofit environment is changing….. • Community needs are growing in size and diversity. • More nonprofits are competing for government and philanthropic funds. • Traditional forms of funding are becoming less reliable. • New for-profit businesses are competing with nonprofits to serve community needs. • Funders and donors are demanding more accountability. • In the face of this new reality, an increasing number of forward-looking nonprofits are focusing on revenue generationand effectiveness that can come from adopting "for profit" business approaches. • Increasingly, they are reinventing themselves as social entrepreneurs, combining "the passion of a social mission with an image of business-like discipline, innovation, and determination."

7. Nonprofit organizations face particular challenges….. • Building a sustainable business is never easy, however, and nonprofit organizations face particular challenges: • NGOs are led by people who, though dedicated and entrepreneurial, usually have little training in launching and managing a competitive venture. They must find ways to combine business success with social impact while overcoming internal concerns that a commercial operation will distract the organization from its core mission or compromise its values. (VOLUNTEER MANAGEMENT) • NGOs are knowledge-intensive bodies. Almost everything they do, from identifying innovative nonprofit organizations to evaluating grants and publishing policy-shaping reports, depends on the use of human and intellectual capital. But many philanthropies, fearing that a dollar spent internally is a dollar wasted, have neither the organization nor the systems to manage their knowledge properly. What they fail to understand is that knowledge is a cornerstone of effective philanthropy. (KNOWLEDGE MANAGEMENT) • For a limited pool of donations is prompting nonprofit organizations to support their missions by generating revenues in the marketplace. (FUND RAISING) • They must also raise the seed money required to turn an idea into reality. The difficulty of surmounting such obstacles means that many projects never get past the idea stage and those that are undertaken have to be delivered with effectveness. (PROJECT MANAGEMENT)

8. Management practices of the private sector may help nonprofit organizations overcome the challenges ahead…... • VOLUNTEER MANAGEMENT • KNOWLEDGE MANAGEMENT • FUND RAISING • PROJECT MANAGEMENT • ORGANIZATION DEVELOPMENT

9. Solutions for Success in NGOs and companies are converging…… “Nonprofits have to recognize that they are businesses, not just causes.  There is a way to combine the very best of the not-for-profit, philanthropic world with the very best of the for-profit, enterprising world. This hybrid is the wave of the future for both profit and nonprofit companies.”

10. NGOs and Companies have much to learn from each other….. COMPANY NGO Efficient Use of Resources

11. Benefits of NGO and Company Collaboration COMPANY NGO • Capacity Building • Management skills development • Efficient use of human resources • Efficient use of resources • Effective partner in solutions • Corporate Social Responsibility success • Increase in employee motivation • NGOs stand to gain by being efficient and productive, engaging the commercial environment in their outreach and influencing companies to be socially responsible, and • Companies stand to gain by being seen as socially responsible, actively participating in social development and nation building, enlightened self-interest - poverty eradication benefits the corporate sector in the long run, and also raising employee morale.

12. Critical Success Factors in Corporate Social Responsibility

13. Companies may improve effectiveness of their CSR projects by supporting NGO’s • For Value Creation – Utilize skills and/or systems developed for own management to an area of focus in line with corporate values and mission. • For Impact – Cooperate with NGOs and develop their institutional capabilities for better acceptance and mobilization of larger resources. Projects through NGO’s in countries become widely accepted rather than being individual company actions • For Sustainability – Apply good governance principles to CSR projects and contributions. Different countries have different attitudes and cultures; which makes it difficult for a company to adapt to all, however by contributing to NGO activities companies get the chance to adapt, learn,and help the fundamental issues for the communities.

14. Critical Success Factors in Social Entrepreneurship • Set the mission and vision with a participative approach • Share mission and vision widely • Establishing a guiding coalition • Match between coalition’s guiding principles and “good governance principles” • Constituting a qualified professional team • Intensive communication related parties • Creating, enriching and communicating examples best-fit NGO’s mission • Determine good examples through objective criteria and reward them • Developing contents for training programs and case studies • Openness to alliances and sharing without hesitation • Use of resources mission-focused • Institutional development of the civil society organization

15. ARGE Consulting • ARGE was founded in 1991 to provide advisory services in the areas of business strategy, business excellence methodologies, evaluation and development of investment projects, development of organizational infrastructure, and change management. • ARGE believes in leading by example.  • ARGE demonstrates corporate social responsibility, by encouraging all its consultants to devote a full day of each week for voluntary work in NGOs to improve the quality of life in our community in a local, national, and global sense. • ARGE collaborates with various Civil Society Organizations to promote good governance principles in NGO management.  First Turkish company to sign the Global Compact

16. ARGE recognized as a leader for Corporate Social Responsibility Recognized as a role model for ‘Responsible Entrepreneurship’ by the European Commission • ARGE Consulting has become the only Turkish company which was recognized in the "Responsible Entrepreneurship” report, prepared by the European Commission to recognize best practices by European SMEs. Role Model for Shaping the Future • At the end of 2002, the European Parliament provided the setting for a Europe-wide recognition of the impact of Developing Civil Society. Generation-Europe, a platform for the young leaders to interact with today’s political and economic leaders, has voted to include ARGE’s efforts among the top three of Europe’s best Corporate Social Responsibility projects. Out of 25 competitors, most of which weremulti-billon dollar companies,ARGEwas recognized among the top threefor theirimpact on “Shaping the Future”.

17. ARGE recognized as a leader for Corporate Social Responsibility • ARGE CSR Case Study – the European Clearing House • ARGE’s efforts in corporate social responsibility are also taught as a case study in many universities. The case study, which was prepared by the BosphorusUniversity, is also taught in universities all around the world through the European Case Clearing House. The case study embodies the context, strategy,and methods in the design and implementation of the “Developing Civil Society” project. CSR4U Best Practice: ARGE Consulting • ARGE corporate social responsibility activities has been chosen as best practice by CSR4U – which is an initiative Mainstreaming Corporate Social Responsibility among SME's run by the Irish Exporters Association/Dublin Euro Info Centre, Fingal County Council and the County Enterprise Boards network. The purpose of the initiative is to increase awareness of CSR among SMEs throughout Ireland. Adelegation of CEOS from the CSR4U initiative has visitedARGE in May2007 in Istanbul for a benchmarking study.

18. Partnership with NGO’s TESEV – The Turkish Economic and Social Studies Foundation ARGE has provided project management and leadership support to our partner NGO – TESEV since in a project named ‘Good Governance - Quality of Life’ to demonstrate effectiveness of participatory democracy. Turkish Education Volunteers Foundation ARGE was instrumental founding and development of the this NGO which has reached more than 1,000,000 kids between ages of 6-16 throughout the country, improving their skills during out of school hours. • KALDER – Turkish Quality Association • Chairman of ARGE, started the National Quality Movement in Turkey in 1998 while he served as the Chairman of the Turkish Quality Association (KalDer). • The National Quality Movement  is probably one of the most effective national programs to extend the use of the EFQM model. • Within National Quality Movement, 60.000 people have been trained in country wide.  CVA–Corporate Volunteer Association ARGE designed the award criteria and process, lead the implementation, and had an active role in volunteer’s award jury to promote innovativeness, impact, and sustainability of volunteerism projects and programs of private sector companies.

19. Civil Society Development Methodology of ARGE 

20. MethodologySteps

21. Thank You! Dr. Yılmaz ARGÜDEN ARGE Consulting www.arge.com

22. 7 Principles of Trustworthiness • Put vision before own interests • Avoid potential conflicts of interest • Remaining neutral, only supporting vision • Accountability • Transparency • Openness and honesty • Be an example through living by these principles