Companies around the world engage in community investment efforts as a way to promote development and benefit local stakeholders in their areas of operation. Done well, community investment can help establish mutually beneficial relationships between a company and its local stakeholders, contribute toward long-term improvements in the quality of life for local communities, and help create an environment conducive to private investment. For IFC, strategic community investment (CI) involves voluntary contributions or actions by companies to help communities in their areas of operation address their development priorities, and take advantage of opportunities created by private investment, in ways that are sustainable and support business objectives. Good practice in this area is evolving. Companies are moving away from philanthropic donations and ad hoc practices to more sophisticated and strategic ways of planning and delivering their community investment programs. There is greater emphasis on the business case—on viewing CI through the lens of risks and opportunities, and on creating “shared value” by aligning business goals and competencies with the development priorities of local stakeholders. Other trends include a focus on building social capital and local ownership through multi-stakeholder processes; factoring sustainability and handover strategies into project design; and measuring and communicating results to optimize the business value derived from CI. While the biggest contribution a company normally makes is in the positive impact of the business itself—through employment, contracts, its supply chain, and payment of taxes— voluntary community investment programs offer an important additional avenue for enhancing positive impacts and socioeconomic benefits. Through CI, companies support capacity building, livelihoods development, skills transfer, and access to social services and infrastructure, often in contexts where the levels of poverty, social risk, and expectation are high, and where business and communities compete for the use of land and natural resources. While this publication focuses on voluntary programs, a strategic approach encourages companies to think creatively and cross-functionally about the many different ways to increase the “share of the pie” that goes to the local population. This means tapping into 4 5 the full spectrum of what the private sector has to offer—from opportunities linked to the core business and supply chain; to business competencies, assets, and know-how; to leverage with key contacts, networks, and partners. In this sense, CI may be viewed as a strategic tool that can be combined with other efforts to generate value for both the business and its neighboring communities. Community investment goes hand-in-hand with a company’s stakeholder engagement efforts. Experience shows that these types of upfront investments in relationship-building with local communities and partners can pay significant dividends during times of conflict or crisis.