Depending on your viewpoint the term ‘corporate philanthropy’ is an unnecessary distraction from the real business of business or, an oxymoron designed to distract people from the negative impacts of corporate behaviour.
In the first camp are followers of Milton Friedman’s economic philosophies which, crudely simplified, suggest management should ‘aim to be as profitable as possible and the good things (improved standards of living, increased national prosperity) will follow as night follows day’.
In the latter category are people like Canadian law professor Joel Bakan whose book The Corporation: the pathological pursuit of profit and power underpins the film The Corporation that has been playing to packed houses in New Zealand.
Bakan suggests that the modern business corporation is constitutionally incapable of putting public good ahead of primary pursuit of profit. Conferred all the rights of an individual, corporations have, he argues, the personality of psychopath who must act in their own self interest and is pathologically unable to care about anyone or anything else.
Even corporate good guys like BP, which has taken lead in enviro-marketing, won’t publicly commit to not drill in the pristine wilderness of the Arctic, says Bakan. By law, BP’s CEO – however green-minded – can’t rule out something that offers huge potential returns for the company’s shareholders.
Bakan doesn’t dismiss the goodwill of some well-intentioned CEOs. Interface’s Ray Anderson – high profile advocate of corporate social responsibility (CSR) in the United States – is, for example, quoted extensively in the film. But Bakan is cynical about companies that embrace CSR, suggesting their actions are seldom more than self-interested attempts to build brand cachet.
That this cynicism is reflected by fairly sizeable and often vocal cadre of consumers highlights the dangers of dancing precipitately off into the brave new world of benevolence hand-in-hand with some high-profile, preferably heart-tugging charity. Cynical marketing ploys, if exposed, generally earn hard-to-counter consumer backlash.
But people like Richard Steckell, who heads Colorado-based AddVenture Network, reside between these extremes. He offers more hopeful and pragmatic take on corporate philanthropy. Borrowing from management author Charles Handy, he talks about “proper selfishness” or, doing something for yourself that also contributes to the greater good.
Steckell, recently in New Zealand, has been pushing the benefits of cause-related marketing since the 1970s. He’s also authored several books on the subject including Making Money While Making Difference: How to profit with non-profit partner.
CSR is, he says, more than passing fad. “The whole cause-related marketing thing was supposed to have peaked in 1988 – that was on the cover of Advertising Age magazine then – but here we are in 2004 and it keeps getting reinvented. People are hungry for something that is hopeful and life affirming. Maybe that is what it touches in people – evidence that they have the ability to take an action that makes difference at some level.”
It helps explain the response to Target initiative in the United States where customers were invited to join scheme in which one percent of their purchase costs could be donated to school of their choice. Steckell reports that some 4.5 million customers joined up and in the first year $15 million was distributed to 20,000 schools.
Social activism
It is, he says, an example of win-win cause-related marketing that is good for the schools, helped the company brand and gave customers the option to indulge in what Steckell calls “soft social activism” – politically motivated purchase.
There are several reasons why and how companies benefit from partnering with not-for-profit (NFP).
According to local ACNielsen survey almost two thirds of consumers prefer to buy products or services from companies that support worthy causes. Strategic alliances with NFPs can, therefore, both reinforce existing customer loyalty and deliver new customers.
And, according to Steckell, the process of defining and living company values helps build internal cohesion and culture that attracts, retains and motivates top staff.
Vodafone’s ‘world of difference’ (WoD) programme is an example. Now into its third year it has benefited whole range of communities and causes – from rural Balinese villagers to Kiwi children in foster care, muscular dystrophy sufferers and yellow-eyed penguins. Vodafone worldwide has picked up on the programme’s success here and helped earn its internal promoter, Lynley Kirk-Smith, the FCB Marketer of the Year Award at this year’s Marketing Magazine Marketing Awards.
Instead of handing cheques to charities, the programme provides support for motivated individuals to donate their skills and year of their time to cause of their choice. Vodafone introduced the programme to do something that “empowered people to make real difference”, says Kirk-Smith, the company’s general manager for communications and sponsorship.
The fact that it empowers individuals is, she says, aligned with company values. “From global perspective the company has what it calls the four passions, one of which is passion for the world around us and this was our way of interpreting that. Instead of aligning with one charity, we wanted to support people who have already demonstrated their passion and commitment to make difference.”
The invitation applies to Vodafone employees as well and one of the four people chosen for the programme last year was Annette Culpan. Her skills in supply chain management were used to good effect working for the Bali Community Health Trust.
Culpan explains that she and partner John have passion for Southeast Asia where they’ve spent lot of time in the past five years. It was only luck that they were not in the Bali club in which he’d celebrated two previous birthdays when it was targeted by terrorists in 2002.
Both wanted to give back to the community that had given so much to them and the Health Trust was recommended as good conduit to work through.
“I applied for sponsorship after the bombing which was in October and when I got it spent the first two months in New Zealand fundraising. Then I was up there as programme manager for the organisation until February this year,” says Culpan.
She is still doing work for the trust on the marketing side. “You can’t do year like that and then walk away. My heart is still there.”
Lip service
She also feels huge loyalty to the company which supported her passion. “It goes beyond being job because this organisation is one that genuinely cares – it’s not just lip service. The culture is amazing.”
While it doesn’t get yelled from the rooftops, Vodafone is proactive on range of social and environmental fronts, says Culpan. “I work here as project manager on social responsibility issues – checking down the supply chain to ensure suppliers treat their people well and behave in an environmentally responsible way. So it’s good to be in CSR-related space.”
Also singing Vodafone’s praises is Jane Denton who used her year’s sponsorship to establish Back-Up New Zealand – an organisation that provides outdoor activities for people with disabilities, as catalyst both for rehabilitation and personal development.
“It’s what I came back from the UK to do but I was really struggling to set up the Trust while working part-time as an occupational therapist. Then friend saw the Vodafone ad [there was series of ‘fun’ ads drawing attention to the WoD programme] and suggested I go for it. Getting that sponsorship has made huge difference – it meant I could work on building the Trust fulltime.”
Since then about 200 people have gone through Trust courses and it now employs two instructors – though fundraising remains struggle. Denton is now aiming to consolidate the organisation and try to get 18 months’ worth of funds in the bank instead of just run
