Stanford Social Innovation Review

WHO PONTIFICATED THAT “GIVING IS THE RIGHT THING TO DO”???
I INVEST IN A COMPANY FOR PROFIT ON INVESTMENT, NOT BECAUSE I BELIEVE IN THEIR
SOCIAL PHILOSOPHY.

»» Posted by: DAHLMANN on July 6, 2006 01:33 PM

I am very glad that SSIR is taking a close look at CSR.  There are so many disparate reasons that corporations do philanthropy, some more “socially responsible” than others.  I have come to appreciate the approach that many banks are taking, providing community development funding with the strategic goal of building new markets for their products by helping turn around marginal communities.  But when alcohol companies provide “philanthropic” programs such as under-writing the former “Tanqueray AIDS Ride” or local “Cinco de Mayo” celebrations, it may have the same strategic goal of building markets but it has provides negative social impacts.

As a consumer, I pay some attention to how companies spread the philanthropic wealth, but as a nonprofit professional and a member of boards, I pay more attention to the message corporate funding sends to the community being served and the potential that such funding has to compromise our ability to hold corporations accountable when they are bad “corporate citizens.”

»» Posted by: John Magisano on July 6, 2006 02:00 PM

It’s hard to know how to interpret these data.  The NCL survey results speak to a post you did earlier on Wal-Mart’s giving (http://postcards.typepad.com/white_telephone/2006/04/who_pays_for_wa.html).  Because the NCL survey is a random survey, the respondents would most likely self-identify as “consumers.” But then we also need to consider that corporations have many “audiences” for their philanthropy—not just consumers ... Anyway, the two surveys make for an interesting juxtaposition which I guess was your point.

»» Posted by: erasmus on July 6, 2006 05:07 PM

The notion that corporations actually conduct philanthropy is a bit ludicrous.  If it only serves to enhance an image--whoever the audience is--it’s not philanthropy, it’s PR.  Any company or corporation that wants to “give something back” can start by providing no-cost health insurance and living wages to its least-paid employees, and making sure all their sub-contractors (such as their janitorial service) do, as well.  Any effort to right the wrongs of society, whether in this country or any other, that does not begin at the bottom—that is, with a work force that is paid adequately to buy food, shelter and medical attention in the same area they in which they work, and with an educational system that is not the shame of the developed world, is not sincere.  The U.S. has a lower literacy rate than Cuba, and is #19 in infant mortality in the developed world.  The majority of bankruptcies in this country are due to medical bills.  (As much as conservatives would like to blame all this on lazy citizens, that argument just doesn’t hold up.  Either that, or there really IS something in the water here.  There’s no good reason the U.S., with a much thinner safety net than most other western countries, should foster laziness at a disproportionate rate.)

When authors such as Kramer and Kania (Changing the Game, Sp 06) begin their article with these two sentences:  “Companies today understand that corporate social responsibility (CSR) forms an inextricable part of their reputations and brand identities,” and “They spend ever-increasing amounts of corporate resources on improving the social, human, and environmental conditions under which they operate” I have to question them.

If, in the case of companies’ reputations and brand identities K. and K. refer to advertising efforts that spuriously connect brands to au currant social concerns, I can agree with them.  However, if they mean a true responsibility to our society as a whole and the well-being of all its members, I certainly question corporate efforts to do this.  As for the notion that “companies today” spend significant amounts of time, money or effort on improving the social, human or environmental conditions under which they operate, separate from their immediate corporate interests, I beg K. and K. to substantiate. 

Coming, as I have, from the public and community media world, I can say I have seen evidence of neither of these assertions.  In fact, the fortunes of public media across the country have fallen precipitously in the last decade or more, as companies have done away with their philanthropy departments and budgets in favor of using advertising dollars to “support” public media and all other social concerns.  (While individual donors’ levels of giving have remained almost constant).  In other words, corporations are not investing in social infrastructure or conditions through philanthropy, they are simply advertising—lining their ad dollars up in the most effective way they can figure, and if that happens to include public media or other social efforts that is incidental to the bottom line.  Once the 9/11 attack happened, companies disappeared almost entirely from the “support” of public media, as they were given what amounted to a “bye” by our president with his greatly attested concern for the economic health of our largest corporations in the wake of that attack.  Nevermind that many of those largest corporations posted record earnings not many quarters later, and continue to post record earnings, while their support for public media has never recovered.

Likewise, I would be very interested in evidence from K. and K. that demonstrates the “ever-increasing amounts of corporate resources (spent) on improving the social, human, and environmental conditions under which they operate,” especially any instances of this that are not the direct result of regulation, union organizing or boycotts.  I certainly see no evidence of this as the cost of health care to employees becomes the first place companies cut their operating budgets, as the rate of increase in the minimum wage lags far behind that of management, as environmental regulation continues to be de-natured by the effects of corporate lobbyists on this administration, as wars are fought--at least in part--for the profits of contracting mercenaries, as the vast majority of jobs created at any moment in this country fall into the minimum wage category, as corporations themselves assert, ad nauseum, that it is illegal for them to do anything that might reduce the bottom line, and as the World Trade Organization pushes further and further into negating all purvue of local government (from environmental to health regulations,and from city governments to federal) in the pursuit of “trade.”
One thing K. and K. may be absolutely right about: “One of the primary reasons CSR has not yet significantly improved society is that the nonprofit and business sectors are for the most part still stuck in their old stereotypical roles.” That I can agree with.

Once we recognize that corporations will never help actually make our society a better place for all people, that this must be demanded from them, we will stop trying to guilt-trip it out of them, and simply tax them at an appropriate rate.

»» Posted by: casacolby on July 27, 2006 02:27 PM

IT IS NOT A “GIVEN” THAT COMPANIES SHOULD PROVIDE HEALTH CARE. IF THE WELFARE OF EMPLOYEES
IS AT STAKE, THEN PERHAPS THEY SHOULD ALSO PROVIDE “SAFE” TRANSPORTATION (NEW CARS??), HEALTHY FOODS
( ORGANIC FRUITS & VEG. ETC.) AND EXTRA TIME OFF FOR REST AND REHABILITATION.  THE LIST COULD
GO ON AND ON. PERHAPS A NEW HOUSE W0ULD MAKE THEM HAPPIER AND WORK HARDER???
COMPANIES SHOULD PAY SALARIES/WAGES FOR WORK DONE, AND LET THE EMPLOYEE ASSUME RESPONSIBILITY
FOR MANAGING THEIR LIVES.

»» Posted by: dahlmann on August 15, 2006 12:54 PM

I am going to have to agree with Dahlmann on this one.  I personally think that giving my own money away is indeed the “right thing to do.” However, in terms of a publicly traded company, it is not the company’s money to give away.  The profits need to either be reinvested in the future earnings of the business, or passed on to the owners.  In the end, it should be left up to the individual owners to decide what should be done with the money they own.

If anyone has any arguments against this, I would really enjoy hearing them, as this is something I often think about.  I struggle with wanting to have a good reason as to why companies should give away their earnings, but I just can’t seem to come to it logically on my own.

»» Posted by: Rob Schmidt on September 26, 2006 06:23 AM

I’d like to believe data - personally my own buying decisions are governed by the way a company treat their staff and suppliers - even working practices and impact to the environment. I’ve always seen charity as a PR stunt - just that! Having worked for a search marketing company for many years, we’ve had many global charities approach us to promote their organisations to corporate clients. These charities are primarily run as busininesses and are keen to point out the PR benefits to any corporation that support them. While this may be the type of Robin Hood attitue that work - it sends a very bad meddage to everyone

Nilhan Jayasinghe

»» Posted by: Nilhan Jayasinghe on November 19, 2006 12:19 PM

Thanks to SIR and SSI SU for this valuable writings.
As companies are now shifting from their short term plan to long term plan and long term plan to all term plans. in this context CSR play a vital role in companies specially in Europe America, and westernized part of the world. As the survey revels the story that corporate are now took csr as the matter of their social value creation process and making world green, carbon free world, green accounting, environmental responsibility all this are nothing but all term plan for the organizations.
The effects sometime may be mostly on their favor.
Due to this more and more companies now took part on this project.
Last thing i want to say …………that truly it helps the companies to gain competitive advantage in the global market and consumers mind, as well as employees mind also.
So 70&#xor; 76% it’s the way of starting some day it reached 100% .
But i can truly agree with the view that consumer purchasing decisions effects on this matter.

»» Posted by: TAPOBRATA DEY on March 24, 2007 12:05 AM

A BIG VOTE FOR PERSONAL RESPONSIBILITY.  NOT, AND I REPEAT NOT, CORPORATE OR GOVT. WELFARE.
THE BLEEDING HEARTS ARE USUALLY THE WORST GIVERS.  (THEY JUST WANT OTHERS TO GIVE.)
DAHLMANN

»» Posted by: DR. PAUL W. HORN, PH.D. on July 12, 2007 08:35 AM