The role of business in Collective Impact

October 27, 2015
Author: Allen Grossman & Ann Lombard

Business leaders acknowledge that excellent public education in the United States is critical to social equity, as well as economic growth and shared prosperity. More than half of business leaders surveyed recently by the US Competitiveness Project at Harvard Business School believe that education-related issues are both a cause of and a remedy to limited economic mobility in the United States; almost 40 percent see changes in education as a way to address increasing poverty. They recognize that young people impacted by poverty must receive a high-quality education to realize their potential.

Poverty’s negative impact on student performance is well-established. As illustrated below, there is a strong relationship between a school’s average standardized test scores and the percentage of students in that school eligible to receive free or reduced-price lunch, a measure of poverty. (Students living in four-person households earning between $31,525 and $44,863 are eligible for reduced-price lunch; those earning $31,525 or below are eligible for free lunch.)

The support a student receives outside the classroom often materially impacts their performance inside the classroom. While middle-income and affluent parents have the resources to provide their children with a range of needed services, such as math tutoring and psychological counseling, lower-income families usually don’t. And while more than 87,000 nonprofits, as well as many local government programs, aim to support youngsters impacted by poverty, they often operate in isolation, lack shared goals, and have little ability to measure effectiveness. Program quality often varies considerably, and service redundancies exist alongside service gaps, diluting the overall impact of the programs.

The net result is service delivery chaos.

Many well-intentioned businesses inadvertently help perpetuate this chaotic situation. US businesses contribute $3-4 billion per year to support public education, either through nonprofits or directly to schools. Despite these generous contributions and countless volunteer hours to improve educational outcomes, particularly for children living in poverty, too often business support is not based on outcome data or coordinated with nonprofits, local government, and others delivering services in the community. As a result, mediocre programs continue to exist even when superior programs are available, and multiple competing programs meet some student needs but leave other needs unaddressed. Business support also typically focuses on one point of the learning continuum, such as third-grade reading or job internships. When these programs are not part of an integrated system of supports, over time the gains achieved may erode or disappear altogether.

Businesses could greatly enhance their effectiveness by working to improve all aspects of the educational ecosystem in partnership with community leaders, families, nonprofits, school districts, and government. The broad, cross-sector coordination at the heart of the collective impact approach provides an innovative process and structure for creating deep and unprecedented partnerships.

To better understand the role business can play in supporting collective impact efforts, we interviewed more than 60 collective impact practitioners, business leaders, and others involved in collaborative education initiatives, and conducted the first national survey of both initiative leaders and the business leaders who serve on their leadership councils.

Many of these collective-impact initiatives are relatively new, but a number are making progress toward their goals. For example, one large district in the Salt Lake region—where a collective-impact initiative has been contributing to growing academic gains for children impacted by poverty since 2011—has seen increases in kindergarten readiness, third-grade reading proficiency, and high-school graduation rates.

They have experienced particularly dramatic increases in graduation rates for English language learners (those whose second language is English), despite poverty rates in the district approaching 60 percent.