Stanford Social Innovation Review

I work for a non-profit organization and we have received several contributions from Apple of equipment and software - they don’t have an established, formal program but there are many ways in which they have supported non-profit organizations. Just because (1) they don’t talk about it (2) you haven’t heard about it, and (3) there is no formal program they have for people to apply—it doesn’t mean it doesn’t happen!

»» Posted by: Michael on June 21, 2007 12:10 PM

Perla,

I haven’t looked into Apple’s NFP support, but Apple does participate in local programs to donate computers to schools in my school district. It’s not flashy philanthropy perhaps, but it is a great help for our communities and our children.

Best regards,
Sheryl

»» Posted by: Sheryl Torr-Brown on June 21, 2007 12:12 PM

Dear Ms. Ni,

I agree with the sentiment of your post.  However, you may want to do a little more research on who you chose to call out.  Costco has a strong giving program, particularly here in the Pacific Northwest.  Additionally, their employment practices are far better than most.  They pay well, provide good benefits, and support their employees professional development.

»» Posted by: Aaron Jacobs on June 21, 2007 12:21 PM

I live and work in a community where COSTCO is well regarded for it’s philanthropic support of local non-profits from it’s corproate headquarters in Issaquah, Washington to the involvement of it’s employees from indivdiual stores.  I also know the company is adverse to publicity about it’s contributions.  I wonder where Business Week got it’s information and if it was self reporting then I would guess that Costco declined to comment.  Corporate executives are personally involved in many non-profits from the arts to human services and the enviroment.

»» Posted by: Jane on June 21, 2007 12:22 PM

Apple has an established program to offer discounts to teachers, students, even—I was just told—PTA members.  Small change, and distinct from pure donations, but it’s something.  I’m all for calling them to account for failing to do more, but it might help to confirm what they’re doing now.

»» Posted by: Catherine Crystal Foster on June 21, 2007 12:23 PM

Let’s not forget all of the venture capital firms, many ironically close to Stanford’s campus.  My experience with them shows little or no philanthropy, and they seem to mentor their start-up clients accordingly.

»» Posted by: Cynthia Skinner on June 21, 2007 12:28 PM

A company’s impact on its community has many faces, and I think a blacklist runs the risk of unfairly demonizing companies. You mention Costco as an example of a company that does not give away much money. I read an article on Costco last week that praised the company for its treatment of workers, relative to other major companies in the discount retail business. While I think Milton Friedman takes the argument too far on the separation or corporations from philanthropy, there is some validity to the premise that companies that pay employees well and generate strong returns to their shareholders have more social impact than those who underperform while being generous to their community.

This is too complex for a simple list of philanthropic giving.

I think the more interesting blacklist would be on individuals of great wealth who do not share it with their communities. Corporations are mere pass-through entities, but the buck stops with their investors. A company making lots of money has social impact in many ways even if it does not give away a dime. But the same can not be said of the wealthy individual. The real question is what is Steve Jobs doing with his wealth, rather than what Apple does before it rewards its investors and employees.

»» Posted by: Aperio on June 21, 2007 12:28 PM

Thanks for reminding me—I need to get a grant application in to Lowe’s. If you want to do that too,
check out their foundation information at
http://www.lowes.com/lowes/lkn?action=pg&p=AboutLowes/Community

$15 million in gifts may not be Gates territory, but it’s not nothing!

»» Posted by: Susan Burns on June 21, 2007 12:30 PM

>>Who else belongs on a list of “Least Philanthropic Companies in America”? Can you guys all chime in, and add your nominations?<<

Love the question and the idea, but have no real idea how to go about finding this out.

»» Posted by: Mark Grimes on June 21, 2007 12:32 PM

I agree there is a big difference between giving money away and conducting business in a responsible manner.  Notice that while Chevron and Clorox are on the list of big givers, while some of the most socially responsible companies--like Timberland, which has revolutionized the NGO/corporate relationship through its partnership with CityCorps--isn’t. 

Sure it’s great when big companies give to United Way and other worthy causes.  But how are they treating their workers, do they integrate environmentalism into their supply chain and do they have a greater social purpose other than simple profit maximization?  Those are the companies I admire.

Lauren

»» Posted by: Lauren Mack on June 21, 2007 12:32 PM

First things first.
Let’s make certain we know what philanthropic support a company provides.
And before that, let’s have some idea of what we count and value as philanthropic support. 
There needs to be some context here.  I’m not impressed by the community support of a company that does not offer a living wage and health benefits to its employees and their families.

»» Posted by: Kevin Cain on June 21, 2007 12:34 PM

...and I vividly remember reading this article about Costco in the NYT back in 2005.  Turned me into Costco shopper.
“How Costco Became the Anti-Wal-Mart”
http://www.nytimes.com/2005/07/17/business/yourmoney/17costco.html?ei=5090&en=8b3103305fea6d68&ex=1279252800&partner=rssuserland&emc=rss&pagewanted=print

»» Posted by: Catherine Crystal Foster on June 21, 2007 12:38 PM

Perla, I’m absolutely with you on this!  It’s important to note who is contributing to the community and in what ways.

To expand, I think it’s important not only to gauge the participation wrt philanthropic efforts but also to give credit to creating healthy work environments.  While I don’t know for certain, my understanding is Apple is a relatively fair place to work.  In its own way, that does give back to the community.  The flip side of course is the more traditional firm that is brutal to its employees, keeping a burn-and-churn environment, but that has a very happy and magnanimous philanthropic face to the world. 

I can talk with you offline about this but I’m very interested in understanding the firm/community boundary, and how money and other forms of wealth (i.e. health, education, etc.) is transferred.

»» Posted by: Jessica Margolin on June 21, 2007 12:41 PM

This thread reminds me of the things that were said some years ago about Microsoft and Bill Gates not giving. It was before I arrived in the Northwest, however it is my understanding that the company and its owner were giving quietly in the region even at that time. And if there was a perceived deficit in their giving I think we would all agree that it has been made up. In our area Costco is always there - mostly to provide product - but there nevertheless. Although it is not the norm for a donor to seek anonymity, particularly a large company, I think we should be careful of our assumptions if they choose to stay mum.  A blacklist serves no purpose.

»» Posted by: Rebecca Wilson on June 21, 2007 12:44 PM

Very good article and I think you are making a contribution to society.
There is one way that companies can readily donate to non-profits and at the same time benefit their financial statements.  It can be a Win, Win situation.
Inventory donated to United Way and other charities can be sold and the cash derived goes to the charity.  United Way Silicon Valley has this program and it should be adopted by every non-profit.  Billions of dollars of inventory go to waste when there is a vehicle to handle such donations.  Mark Walker at UWSV knows the program.
I also can describe the program,
Best,
gene

»» Posted by: gene hellar on June 21, 2007 12:52 PM

Perla,

Costco does wonderful work up here in the Northwest for United Ways throughout the region, allowing access to their workplaces, encouraging philanthropic engagement, etc.  Their management is very supportive to human service efforts.  In fact, a few years ago, founder Jeff Brotman and his wife were recognized in King County as Philanthropists of the Year.

»» Posted by: Dr. Ethan R. Allen, President, United Way of Pierc on June 21, 2007 01:05 PM

A corporation’s social contribution should not be ranked on its philanthropy.  Corporations use giving as cheap marketing for pet causes of their officers.  If a corporation gives a few million dollars but causes billions in environmental damage they have a negative effect.  But if a corporation provides many jobs, great services to customers at the cheapest possible prices, and dividends to shareholders that in turn contributions, society is much more greatly served.  In the end a corporation’s responsibility is to increase shareholders wealth, without doing harm to others.  The benefits of this wealth creation endeavorer will always dwarf the benefits of their tiny philanthropy.

»» Posted by: Andy on June 21, 2007 01:06 PM

Curtis Weeden, once VP for Giving at a major company with a great reputation for its “philanthropy”, wrote that corporate philanthropy is an oxymoron. It is a form of social marketing, which is fine, but for us to be continually fooled iby these numbers suggests we are not digging deeply enough in thto the substance of the matter. A look at the numbers. Freeport McMoran seems to be the highest at.9%. At the same time they have had problems with communities in virtually every place they have worked, with pollution, hiring of guards, defacement of land, air and land pollution. ExxonMobil on the other hand records a .0%. Their position on climate change hardly falls under a philanthropic cover, despite the huge amount they give. A decade or more ago when I was president of the Noyes Foundation Intel received high ratings for its philanthropy at the same time that it was refusing to talk to the communities where they worked, particularly in Albuquerque, about water usage and air pollution. They did a turn-around only after they faced a shareowner proxy resolution that the Foundation filed on behalf fo the community organization that was leading the fight for a change in their policies. Do we choose to balance science fellowships that are good publicity and help to train future employees, against the health and welfare of people, often poor people and people of color? Let us get real as to how we assess these matters.

»» Posted by: Steve Viederman on June 21, 2007 01:35 PM

One of the reasons we have a need for nonprofits is because the way we do business diminishes the quality of life in our communities.  When a worker is paid the least possible wage and left to scamble for daily needs, and such practices are seen as responsible business, then we have families weakened and vulberable, one crisis away from trouble. 

So to me, a company like Costco is preventing the scurges that put so many nonprofits into business.  If their practices were universal, I expect at least half of our social service agencies would go out of business, and our communities would be stronger and happier for it.

»» Posted by: Melissa on June 21, 2007 01:36 PM

Lowes is the exclusive provider and sponsor of Habitat for Humanity.

»» Posted by: Richard Wong on June 21, 2007 01:43 PM

PLEASE - do some homework before slamming some of America’s world class corporations. GEEZ!

A quick look at the FACTS will show that Costco’s support to local community based organizations in the U.S., Canada etc. is an example of corporate America at its best.  In total, the Costco U.S. employees’ personally donated over +$8M dollars to local community services - in addition, the Costco Foundation matched those employee contribuitions by contributing .50 per dollar (+$4m) totalling +$12M in 2006. This giving does NOT include Costco’s generous help during times of disaster nor does it include other support to many many other nonprofits etc....

These corporations, the people that created them and the people that work in them have the same “STUFF” that Alexis de Tocqueville wrote about in the 1830’s when he said “the voluntary association and voluntary effort for the common good appears to be uniquely American.”

I could go on - but I hope you get the idea.

»» Posted by: Chuck G on June 21, 2007 02:21 PM

I know an entry in the Opinion Blog is, naturally, opinion and extemporaneous dialogue, but it doesn’t seem like you inquired with Apple or Costco to see what kind of philanthropic initiatives they have (or may not have). Might serve you well to fire off a few e-mails before posting something like this; even if you don’t get replies, you can at least say you tried to contact.

»» Posted by: J. Lenowitz on June 21, 2007 02:31 PM

I DON’T LIKE TO HEAR THE PHRASE “GIVE SOMETHING BACK”.  THE PERSON USING IT SEEMS TO BE SUGGESTING
THAT THE COMPANY ILLEGALLY, OR IN SOME WRONG WAY, GOT THEIR MONEY.
I STRONGLY BELIEVE THAT THOSE WHO CAME UP WITH GREAT IDEAS THAT MADE LOTS OF MONEY SHOULD BE
ABLE TO KEEP IT.  ALSO INVESTORS ARE DUE THEIR REWARD.
THE PARASITES AND SPONGES WHO LIVE ON THE “DONATIONS” ARE BEHIND THE “GIVE ME SOME” PHILOSOPHY.

»» Posted by: DR. PAUL W. HORN, PH.D. on June 21, 2007 02:44 PM

WHAT ERRORS WERE ENCOUNTERED???

»» Posted by: DR. PAUL W. HORN, PH.D. on June 21, 2007 02:45 PM

Clearly, there are many different expectations regarding what is appropriate philanthropic behavior for corporations.  I stated my views above.

However, one thing I think should be readily apparent is that the donation of a company’s EMPLOYEES is different than the donation of the company.  That the company has a matching program that it administers is obviously part of corporate philanthropic activity, but employee giving has absolutely nothing to do with corporate philanthropy.

»» Posted by: Jessica Margolin on June 21, 2007 03:41 PM

On the other side of the equation, Target, and it’s parent company, have ALWAYS given away 5% of it’s pre-tax profit to charity.  THAT’s a standard that other corporations could attempt to emulate, to be sure.  If all corporations in America met that standard, it could literally change the nature of many social ills in our nation, and perhaps the world.

»» Posted by: David Bubis on June 21, 2007 03:52 PM

You may want to do more research on corporate social responsibility and do a more in depth look at this subject.  There are so many aspects to it that it does great injustice to start finger-pointing. Were these companies even contacted.  I am surprised to see something coming from SSIR with so little rigor.

Some great sources (from some great minds):

Porter and Kramer, “Strategy and Society”, Harvard Business Review, Harvard Business School, December 2006
Anonymous, “10 Questions With… David Henderson”, Journal of Financial Planning, Aug 2005, 18, 8; ABI/INFORM Global, pg. 10
David, Ian, “Special Report: The biggest contract – Business and society”, The Economist, London, May 28, 2005, Vol.375, Iss.8428, pg.87
Atkins, Betsy, “Is Corporate Social Responsibility Responsible?”, Directorship, Nov 2006, Research Library, pg.33
Lantos, Geoffrey P., “The boundaries of strategic corporate social responsibility”, The Journal of Consumer Marketing, 2001, 18, 7, Research Library, pg. 595
Hertz, Noreena, ”Doing the right thing is good for business.”, New Statesman, Sep 4, 2006, 135, 4808, Research Library, pg. 20
Long, Mark, “Nigerian Senate Seeks Damages from Shell Unit”, The Wall Street Journal, Eastern Edition, New York, NY Aug 26, 2004, pg. A2
Balmond, Sarah, ” News In Depth, Retailers woo consumers with ethical marketing”, Design Week, London, Feb 9, 2006, Pg. 7

»» Posted by: Derek S. Darling on June 21, 2007 05:32 PM

Perla,
I agree that we should draw attention to the corporations that are lacking in owning up to some social responsibility, but I echo others in saying that we need to be careful and do comprehensive research before we label anyone with the “non-giver” status. To do otherwise smacks of entitlement, which is the silent killer of nonprofit organizations. The fact is, whether donors are individuals, foundations, or corporations and however their giving is informed, the money belongs to them and it’s perfectly within their rights to decide how to spend or invest it. Wise corporations invest in their communities. Again, however, it’s up to the company to decide what constitutes its community. In-kind contributions, volunteer service (e.g., Timberland gives employees release time to volunteer...), or extremely localized support are all valid ways to handle giving back. It would be a mistake to confuse our frustration as fundraisers (we can’t get what we want from the ones we think should give it) with a lack of social responsibility on the part of the donor. Look at all the corporations who have signed on to help fight global warming by altering their own practices to cut carbon emissions. My organization and yours might not benefit directly from their largess, but the world certainly does. Of course, in a perfect world all corporations would give 5 or even 10% of their profits to the public good. In a perfect world, we wouldn’t fight wars for oil or let genocide go unchecked in countries that don’t contribute to our national bottom line, either. Good behavior--in whatever guise it takes--needs to be rewarded and encouraged to stimulate more companies to contribute. In the meantime, our job in the nonprofit sector is to plug away at our jobs, trying to gain their support in ways that are mutually meaningful and beneficial.
n.b. to Dr. Horn: you’re entitled to your opinion, but please don’t SHOUT.

»» Posted by: Janice Deputy on June 21, 2007 06:16 PM

Perla,

I must join the many respondents concerned about the depth of inquiry which prompted the negative picture you’ve drawn of these companies’ philanthropic commitments. What you’ve printed here is truly unfortunate from many angles. None the least of which is, this blog attempts to avail itself of the fine reputation of a great institution. Stanford has not been well served by such reckless and senseless “finger pointing.”

For any who may have been innocently mislead by such carelessness, I trust they understand that there are many corporate citizens who make contributions in the communities where they do business, not for market share but, out of a sense of community. The lack of contrived headlines or 20 second broadcast spots should not be interpreted as “….nowhere to be seen on the philanthropic landscape”.

Those who have been the recipients of Costco’s philanthropy would encourage others who read this blog to: check with the several United Way organizations in each community where there is a Costco; contact any of the Children’s Miracle Network hospitals; review the list of donors to the National and local Communities in School organizations; research the list of corporate support towards the efforts of the American Red Cross in the recent National and International disaster relief activities; further invite your readers to post what they find relative to the many colleges and university scholarship awards assisted by Costco donations (including the UNCF). And truly, for those who wish to know, the list will go on and on. 

What you’ve printed here bears out that “A little bit of knowledge is a dangerous thing”.
I encourage you to be fair to these companies and your readers and “…..drink deep”.

»» Posted by: Jimmy Daniel on June 21, 2007 11:18 PM

I would have assumed research and Stanford were synonymous. You’ve proven this to be the contrary. Slamming corporations without doing your homework - shame on you!

“And it’s not just tech companies who don’t do anything for their communities.” Gateway Computers is extremely generous in donating hard/software, not to mention the family foundations which give large monetary sums to a variety of causes.

I can suggest a ‘list’.  “The who not to take time to read list”.

»» Posted by: Nancy McGuire on June 22, 2007 05:45 AM

Wow, great feedback you guys!  This is super to hear that Costco are doing something with your local nonprofits.  The three companies that I named came from a comparison of the BusinessWeeks Survey of Corporate philanthropy http://www.businessweek.com/investing/philanthropy/2005/company.htm compared to their ranking on the Fortune 500 list.  That is not saying that these companies are not giving anything at all ... simply that what they are doing is meager compared to what many think they could be doing given their profits and compared to other companies.  It is useful I think to have comparisons otherwise it is a meaningless accolade to those companies that do give a lot a philanthropy. 

I agree too with your comments that a company should not be solely judged by dolllars and that employee involvement with nonprofits is not to be discounted.  And certainly the way the company conducts its business and treats is employees and environment are part of the comprehensive picture.  A 360 picture of a company taking all these factors into consideration would certainly be the next step to determining a companys overall corporate social responsibility.  This post was simply a first step around the more limited definition of philanthropy.

»» Posted by: Perla Ni on June 22, 2007 10:00 AM

Perla,

I suggest that most commenters are genuinely supportive of a goal to improve overall corporate social responsiblity.  However Corporate Philanthropy per se should be not be a heavily weighted factor in such a 360 degree evaluation.  Rating corporations poorly for not giving as much cash or goods relative to others just stresses the wrong values.  The next step in such intrusion will be criticizing the quality of their giving which is purely a shareholder (not a societal) concern.

It’s all well and good if an enterepreneur who’s own investment is tied up in the business (or a family business as group) want’s to dole funds out using his or her company as a vehicle.  However, when a public company, a VC portfolio firm, etc. does so it is both diverting funds from further development of the business to the detriment of investors and is making a decision how to allocate those dollars in ways that may not align with the true desires of shareholders.

Thus I’m in agreement with Andy who stated:

“… In the end a corporation’s responsibility is to increase shareholders wealth, without doing harm to others.  The benefits of this wealth creation endeavorer will always dwarf the benefits of their tiny philanthropy.”

I suggest that the key motivators (beyond ego gratification) of large corporate philanthropy programs using other people’s money is:
a) to bond employees to a set of values held by the leadership of the company (stengthens corporate culture)
b) a desire to show the company in a favorable light shielding it from criticism from those who would stoop to rating companies based on their philanthropy (least effective motivator in my view)
c) a desire to shield the tax bite on the company and allocate those dollars towards philanthropic programs in a manner the leadership feels make best use of their funds rather than trusting government to do a good job with those dollars (a very big motivator), and
d) an honest belief that they can have a bigger impact with large corporate based giving programs (also a big motivator).

Finally, I’ll submit that it’s this last rationale that is the biggest reason why there seems to be a certain element of commentors that support the concept of a ranking system.  It’s easier and more cost effective to raise money in large gifts from a few big corporate players than to rely on the individual donations of many more individuals.  Anything they think helps increase the dollar flow is thus a good idea.

In my view, it’s always far better to encourage positive behaviour through highlighting good examples and working with those corporate leaders to direct their personal giving practicies in positive ways and use their influence towards encouraging their employees in a philanthropic manner as well through thier good example.  Shaming anyone into action is only a short term motivator and in the end has unsustainable results as reactionary corporate leaders respond to the next public relations threat in another area. 

Finally, if corporate leadership is going to insist on a philanthropic giving program then developing fair vehicles for shareholders to have a direct vote in how the money is spent is always best, perhaps through a menu of choices on an annual proxy statement.  If shareholders vote no on everything since they don’t agree with the corporate selections then don’t spend the portion of the philanthropic budget or dividend that money out to those shareholders so they can allocate it as they see fit.

»» Posted by: CBerolzheimer on June 22, 2007 02:49 PM

perla, you raise some very valid points and jumping off points for discussion. back in the mid-1990’s apple computer was involved in some philanthropy that benefited small grassroots nonprofits, members of Community Technology Centers’ Network (CTCNet), working to bridge the digital divide. i was working for the adult literacy division of the DC Public Libraries at that time, which received several donated powermacs, laser printer, scanner and digital camera. this equipment did propel our program forward. here is one of the digital storytelling creative products we made using that grant.
http://www.writersforliteracy.org/fannielouhamer2.mov

about 20 to 30 other members of CTCNet also received equipment grants, as i recall. the grant giving took place over a 2 or 3 year period between 1995 and 1997.  interestingly, those equipment donations occurred at a point where apple computer was really hurting financially—close to the point of closing down.

when steve jobs returned to apple he canceled all givings programs. anyone else trying to rescue the company would probably have done the same.

i do wonder why apple has not reinstated any publicly viewable givings program. i do know that as a company, they tend to support digital divide (i.e. outreach to those in need) and environmental causes. my sense is that they could be doing much more.

apple’s “philanthropy” need not even cost them money. apple could be using its own web site and announcements-only email lists far more effectively to support the social sector. i long ago gave up hope of seeing interesting quicktime movies listed in apple’s quicktime news announcements list. that could change in a heartbeat if someone at apple wanted it to change.

phil shapiro

»» Posted by: phil shapiro on June 25, 2007 01:46 AM

You are WAY off base on calling out Costco. There is not a more socially responsible company around. They just dont advertiose it—they use all available funds to keep their member prices low. In addition, they insist on the same behavior from their vendors, who must follow a strict code of conduct to do business with them. They are a ccompany of integrity from the top down.

You should do your homework before making such irresponsible accusations.

JD

»» Posted by: JD Rogers on June 26, 2007 09:15 AM

Great post. Here’s one: what about AOL? They were doing minimal giving until last fall and then they cut the whole corporate giving department. No news coverage on it as a “cost cutting move” that was lost in the midst other staff cuts they did at the time. In my mind multizillion dollar international companies that aren’t agressively participating in local and global philanthropy are lost souls. They can make money for the shareholder AND participate in helping society. There are plenty of examples that support this notion.

»» Posted by: Mark C. on July 8, 2007 08:18 PM

I have been following this exchange of postings in response to Perla Ni’s original message for several weeks and it represents some of the most interesting thoughts, opinions, etc. on this subject that I have come across in quite some time.  The original sentiments expressed are important and relevant, and should not silenced by a handful critics taking issue with the absence of more rigorous research.  As some of the comments here show, corporate philanthropy as it has been practiced in the last 50-60 years is in the midst of a major transformation shaped by a myriad of forces.  Discussion-debate-conjecture couldn’t come at a more opportune time.  I hope that SSIR will devote an article to this subject in a future issue and I will be only to happy to contribute 30+ years of knowledge and experience to such an effort.  Kudos to Ms. Ni for getting this conversation going!

»» Posted by: Byron Reimus on July 23, 2007 01:36 PM

The Apple story appears blatant but since there are numerous agencies trying to dig up the truth of things, this is one issue that needs to be investigated.  It could also apply to our sports icons who make millions per appearance and arrogantly ignore their social responsibility - if they are even aware that they have such a responsibility.  I have never seen anything that ranks sports figures for what they do for the community - it is all about idiotic home runs on steroids!
gh

»» Posted by: gene on August 6, 2007 09:35 AM

Perla,
I am glad you used the phrases such as “To my knowledge” and “as far as I know”.  You really don’t know much about the Jobs and Apple.

They are social enterpreneurs who don’t just hand out their money.  They have a much broader vision on how they can make a difference, and are definitely en route to redefining Philanthropy.  Through their own charitable entities and Apple Inc, they and the company have contributed financially, strategically and sometimes operationally.  Instead of defining greatness in charity by xxx millions, they run their philanthropic work by applying corporate skills and strategies.  From the funding to promotions of the supported groups to identifying focuses, they contribute much more than just writing checks.  They do not flash their work and don’t wear it on their sleeves, but their work in “giving back” is very respectable.

Look deeper and broader and you will have a better understanding.

»» Posted by: Cynthia on September 15, 2007 11:13 PM