Pact's Corporate Community Engagement Policy

(Pact's initial CCE policy approved 2001, policy revised 2007)

Pact's Mission and CCE Vision
Considerations in Pact's Corporate Community Engagement
Terms of Engagement
Types of CCE Relationships
Decision making process overview
Standard Process Components for CCE Relationships

Pact's Mission and CCE Vision

Pact's mission is to build empowered communities, effective governments and responsible private institutions that give people an opportunity for a better life. We do this by strengthening the capacity of organizations and institutions to be good service providers, represent their stakeholders, network with others for learning and knowledge sharing, and advocate for social, economic and environmental justice. Interdependence, responsible stewardship, inclusion of vulnerable groups, and respect for local ownership and knowledge are core values across all of our programs.

Pact's vision for Corporate Community Engagement (CCE) is to help shape a world in which corporations and communities work together to address the challenges of poverty and social alienation that threaten social and economic stability. This vision recognizes that corporations and communities have mutual interests. Corporations benefit from community respect and support. Communities benefit from an enlightened corporate presence that views the role of business in society to include ethical behavior, responsible operations and positive contribution to society extending beyond mere focus on the bottom line. The CCE vision extends to all levels of Pact, encompassing board, headquarters, country programs and local partners. CCE involves all parties in sharing contacts, resources, insights and recommendations. Its successes and failures have institution-wide implications that require a high degree of coordinated involvement.

Pact acknowledges both a wide spectrum of potential relationships and deep levels of engagement with some companies. Philanthropic relationships for program support will continue to be an avenue for relationship building and cooperation with business to advance Pact's work with communities. Engagement with business through deeper partnerships offers new opportunities for Pact to mobilize its expertise and networks in the service of community development and capacity building. Partnerships may address such issues as governance and transparency, security, HIV/AIDS, or core business operations and their impact on local communities.

Pact's CCE partnership decisions and actions will be guided by three objectives:

• To create new processes and institutions in which business and civil society cooperate for social good and leverage business actions that advance social development;
• To assist communities and business engage effectively to enhance the positive impacts of business on social development, especially in local capacity building and community development; and
• To help communities and business engage effectively to mitigate or eliminate potential adverse impacts of a particular business' presence or operations.

Pact defines "community" broadly to include local communities, and also individuals, smaller municipalities, migrant workers and other populations that may not fit a narrow traditional definition of "communities."

Considerations in Pact's Corporate Community Engagement
Pact is a values-driven organization. Its values and guiding principles were reaffirmed as the foundation for its work in the organization-wide strategic planning and stakeholder engagement process in 2006, which culminated in Pact's Strategy 2010. Pact's CCE policy is consistent with the values, principles, goals and objectives articulated in Strategy 2010, which serve as a daily guide for Pact's operations and practices. Other principles relevant to relationships developed through Pact's corporate community engagement include the following:

• Pact's CCE work will advance Pact's core mission, be aligned with its guiding principles, and meet its standards.
• Pact will recognize that business seeks to be profitable.
• Pact's CCE work will have a clear entry point, intervention and role that align with the goals and objectives outlined in Strategy 2010.
• Pact's primary consideration in engaging with a particular business will be the potential for that relationship to improve development outcomes for particular communities.
• Pact will regularly assess and monitor how its partners carry out their engagement with Pact.
• Pact will always remain community-centered and focused on sustainable community empowerment; serving community interests will supersede partner and company objectives and business purpose in case of any conflict.
• Pact will maintain internal and external dialogue on the appropriate role of CCE in specific fragile states (for example, by maintaining dialogue with donors, host country governments, and relevant organizations focused on human rights, environmental issues, humanitarian relief, and conflict mediation).
• Pact will seek to retain and safeguard its independence of identity, action and voice in all of its CCE relationships to the maximum extent possible.
• Pact will protect itself and community interests through agreements precluding any endorsement and assuming any liability arising from the activities of its corporate partners.
• Pact will consider appropriate ways to align its investment policies with its CCE and other corporate policies in order to adhere to the same standards it expects of its partners and that its investments are at all times consistent with best practices.

Terms of Engagement
Pact will enter into individual written agreements appropriate to the specific relationship to be pursued. The terms of engagement will set forth the parties' commitment to each other; how activities are to be funded and by which organization; specific conditions relating to the duration and nature of the relationship; termination provisions: and protocols outlining the parties' expectations for communications, interaction, disclosure and conduct.

Types of CCE Relationships
Pact envisages a range of CCE relationships. Some will be direct relationships with companies. Pact will also participate in broader coalitions involving several companies and other institutional partners. Pact will continue to seek philanthropic relationships with companies through which Pact programs will gain additional financial, technical, in-kind or human resources. Other relationships will be more intensive? true partnerships in which Pact becomes involved with important aspects of a company's presence or operations and where the potential risks and rewards are greater. There may be occasions when Pact is asked for (or wants to provide) advice, or when a company contracts for specific services that Pact is well positioned to provide, such as stakeholder mapping or engagement activities. Pact will also seek to promote collective action through coalition or alliance-style relationships in which Pact joins with many institutional partners, companies among them, to advance shared objectives.

Pact will enter into a CCE relationship only when it concludes that there is sufficient public interest present that will be fully aligned with Pact's mission and capabilities. Pact recognizes that business will always be motivated by the desire to make profits. When considering potential relationships, Pact will analyze the extent to which the broader public and community interest will be served. Pact will not enter a CCE relationship that serves business purposes primarily.

CCE relationships will not always be pursued directly with business entities. Pact's business engagement strategies will also be pursued through relationships with donors or multilateral agencies, host country governments, human rights or environmental groups, and with local stakeholders. Decisions about such engagements will be evaluated in light of the entry point, intervention, or specific role relevant to Pact's mission, strategy and capabilities.

Decision making process overview
Pact will assess the potential risks, opportunities and alignment of all proposed CCE engagements with Pact's mission and values.

Relationships may be initiated and carried out at both field and headquarters levels. They will involve a range of activities from program support to longer-term strategic engagement. To ensure due attention to the opportunities and risks associated with engagement and to the issues and concerns of the full board and staff (field and headquarters), decisions regarding whether to enter into a partnership will be made collaboratively, with consensus sought at both the field and HQ levels, while ultimate authority for approval will reside with the chief executive and board.

Pact's chief executive, staff, and board will give due consideration to the following criteria as CCE relationships are considered:

• Potential level of risk
  • Potential to adversely affect Pact's reputation or existing relationships
  • Potential for adverse impacts in the community
  • Community experience, perspectives and potential opposition
  • Threats and hazards present in the context or potentially triggered
• Potential level of opportunity
  • Scale and scope of potential benefits compared to costs to be incurred (return on investment of time and effort)
  • Ability to support community-centered development priorities, outcomes and empowerment
  • Ability to leverage action or build collective efforts
• Capacity to achieve desired results
  • Ability to manage relationship effectively
  • Sincerity of the potential partner(s)
  • Ability to fulfill the role and perform the services
  • Ability to secure adequate resources
  • Ability to promote community-centered sustainable development and deliver results

Standard Process Components for CCE Relationships
Pact has specific guidelines and procedures associated with its CCE work.

• Risk and Opportunity Assessment
• Due Diligence
• Organizational Approval and Governance
• Formalizing Relationships in Written Agreements
• Risk Management
• Relationship, Communication and Information Management
• Monitoring and Evaluation
• Annual Policy Review