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15. The Power of Corporate-Nonprofit Alliances

Weeden, Curt Berrett-Koehler Publishers ePub

Amultitude of impressive corporate-nonprofit initiatives dot the private-sector landscape:

Aetna and U.S. Healthcare are spending $7 million to educate women about heart disease and stroke.

Microsoft and the American Association of Retired Persons (AARP) are collaborating to run Lifetime Connection seminars to educate older adults about personal computers.

Pfizer has a $5 million program involving several nonprofit institutions that is aimed at improving children’s health.

MCI donates a percentage of phone payments made by business owner customers to the Nature Conservancy or the Audubon Society.

These are examples of effective corporate-nonprofit partnerships that were born and raised without the helping hand of the ten-step corporate social investing model. And that leads to the obvious question: Is social investing really necessary if businesses are already forging strategic relationships with nonprofit organizations? The answer is yes for a number of reasons.

Many corporations deliberately keep their social responsibility activities in a dim light or in the closet because they aren’t sure how different stakeholders will view such commitments. In contrast, corporate social investing should encourage businesses to be more open about what they are doing with nonprofit organizations. Because the ten-step model makes it clear that a company is using its nonprofit investments to enhance the value of the corporation as well as to benefit society, businesses should be less inclined to want to hide such sensible, business-enhancing expenditures.

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8. Step 6. The Annual Social Involvement Report

Weeden, Curt Berrett-Koehler Publishers ePub

If you’ve put on a few too many pounds or if you think you look anorexic, the thought of slipping into a bathing suit and heading for the beach might not thrill you.

Such is the state of mind of most businesses in America after giving their corporate responsibility profiles a once-over. Do you really want to expose yourself when you presume that anyone who glances your way is going to be turned off?

There are a lot of good reasons why businesses aren’t pulling back the covers on their corporate philanthropy, community relations, and social responsibility activities. The primary concern is that showing off too much may be absolutely abhorrent to anyone who thinks money spent on external affairs is pure unadulterated business fat. Now along comes the next step in the social investing management model:

Step 6. Produce a written corporate social involvement report that includes a review of social investments at least once a year.

A nervous ripple works it way through the private sector. “Don’t take me there!” corporate captains implore. Business leaders usually learn (often the hard way) that the written word can turn on you like a mad dog. Particularly in light of the mixed views people have about corporate social responsibility, reducing a company’s corporate responsibility activities to print seems to be a ticket to the dark side. That kind of report might win a few kudos for the company, but it also could be a hand grenade for some angry, don’t-give-away-my-dividend shareholder.

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11. Step 8. When Social Investing Should Be Postponed

Weeden, Curt Berrett-Koehler Publishers ePub

If Step 7 puts a knot in a CEO’s stomach, Step 8 should help untie it. This is corporate social investing’s emergency brake:

Step 8. Postpone some or all corporate social investing if projected business conditions warrant such action.

What a company budgets for social investing this year is largely a shadow of the corporation’s past; it’s the by-product of profits generated over the previous three years. When a corporation runs up a string of successes, everything is rosy. In the afterglow of its financial achievements, a company calculates how much it should be spending for social investing in the year ahead and plugs that amount into its budget.

But what happens if a company’s sales and earnings are projected to flatten out during the next twelve months, or worse, what happens if the crystal ball says the company is headed for an even more serious tailspin? This is when senior management puts its foot on the eighth step in the social investment management model.

In the best of times, corporate social investing comes with a huge upside for nonprofit organizations—more money, more corporate involvement in nonprofit activities, more partnerships that lead to added federal and private funding, and so on. However, like most things in life, higher rewards usually mean greater risk.

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6. Step 4. Making a Declaration for Corporate Social Investing

Weeden, Curt Berrett-Koehler Publishers ePub

There are those who think Robert Haas is Mosewith a profit motive. The chairman of the world’s largest apparel maker has a reputation for leaving his San Francisco office and ascending into the Sierras to conjure up big ideas for Levi Strauss & Company. One never knows what Haas will bring down from the mountain. Maybe a new business development strategy. Or possibly something still dripping of transcendental meditation, like a notion to improve the “psychic ownership” of his company.

Haas isn’t just another California oddity who by some quirk of fate has been plopped onto the throne of one of America’s big businesses. The man has had remarkable success turning Levi Strauss into the archetypal values-driven company. The firm’s Aspirations Statement, written in 1987, is a model for employee empowerment and effective organizational leadership. The statement covers a lot of territory as it highlights everything from diversity to the need for striking a balance between personal and professional obligations. It is the company’s manifesto for enriching the business and the people who work for it.

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1. The Confused State of Corporate Philanthropy

Weeden, Curt Berrett-Koehler Publishers ePub

Each year, companies spend billions on something called external relations, and they frequently do so without enforcing the same kind of tough management standards that they usually apply to other aspects of their businesses. Stakeholders are often left scratching their heads about the true value of a hodgepodge of “soft” functions that encompass community and public affairs, corporate social responsibility, and—most of all—corporate philanthropy.

Of all the activities that have been stuck into this curious corporate corner, perhaps nothing is more mystifying than the way businesses relate (or don’t relate) to nonprofit organizations and government institutions. If the public is left with a schizophrenic impression about what’s going on between the private sector and these outside audiences, it’s understandable. Consider the following two prevalent if contradictory impressions.

The evidence is indisputable that when it comes to supporting nonprofit organizations, corporations are getting parsimonious with both their fiscal and their human resources. Companies are donating less of their pretax earnings to nonprofits than they did only a few years ago. What’s more, it’s getting harder to squeeze employee volunteers out of significantly downsized corporations.

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