Pontificia Universidad Católica de Chile
The Corporation for Children’s Credit (CCM) was a nonprofit created in 1990 to protect under-age girls at risk of abandonment, poverty, abuse and dysfunctional family backgrounds. This initiative, promoted by an executive at BCI, a leading financial institution in Chile, had grown and become an example of protection programs for youths at risk.
Since inception, CCM had operated under BCI’s mentoring. The initiative had been launched by BCI executives and its comptroller, who all donated their own money to fund CCM operations. In 1994, BCI’s president, Luis Enrique Yarur, decided to use bank funds to support CCM. While no legal ties bound BCI to CCM, a de-facto collaboration agreement joined both organizations. BCI provided donations to pay for CCM’s high operating costs and welcomed CCM employees at its Santiago facilities.
CCM had appointed a professional to manage its operations and had built a board with former and current BCI officials. CCM’s board members met once a month to supervise its operations. The BCI-CCM alliance had expanded outside the bank’s ranks to include its customers, who made monthly donations that were deduced from their accounts.
Eventually, CCM expanded from its original site in Santiago to a town in Southern Chile and was now faced with a requirement to open a new home in a Northern city. This expansion placed an additional financial burden on CCM, and, in 2002, Pedro Balla, CCM’s Board Chairman, was considering whether the organization should further its expansion, finding new funding sources, which ultimately meant venturing outside the bank to look for new donors. Balla feared that this would jeopardize CCM’s existing and special relationship with BCI.
The case provides enough information for class participants to explore this partnership’s evolution, its actors’ needs and benefits, and the challenges posed by CCM’s expansion.
This case may be used in programs dealing with social entrepreneurship and corporate social responsibility or other graduate courses that delve into cross-sector collaborations among business companies and nonprofits.