Paul Klein, who heads business and civil sector consulting group Impakt, encourages any corporations who are giving away their hard-earned dollars to charity to stop.
Klein, admittedly, doesn’t go as far as Milton Friedman famously did, saying that the only responsibility of a business was to make a profit, or as Jamie Whyte implied even more stingingly in the Wall Street Journal, “Corporate philanthropy is theft.” However, Klein spares no punches when it comes to charities. He recommends they “can address the loss of 5% of their revenue by reducing costs, improving efficiency.” (Those who argue that charities should spend more on overheads will wince at that uppercut.) The five-percent figure quoted is the corporate contribution to nonprofit income.
The Giving USA statistics from which the number is drawn also show that corporations’ giving to charities declined during 2013. Yet there has been a steady flow of reports and articles pointing out that companies who do good in the world do well. A 2013 Cone Communications/Echo Global CSR Study says companies are “expected to be an active participant—if not a driving force—in solving the most pressing social and environmental issues.” Cause marketing—such as Toms’ “One for One,” (Product) Red, and Patagonia’s “Common Threads”—has been highly successful. Millennials, we are told, choose to join and stay with companies on the basis of their volunteer programs and social commitment.
However, it might just be a matter of semantics. Aren’t all the above types of doing good by companies forms of corporate philanthropy? Or are they corporate citizenship? Or corporate social responsibility? Impakt on their website extends this lexicon with yet another label: corporate shared value.
Might it be possible to take a contrary view that has corporate philanthropy is alive, well, and kicking—and adopting many different guises? I have always argued that the best thing for corporate fundraisers to do is to decode then rearrange the letters in the corporate alphabet soup. As well as CSR other acronyms in the soup are CP (Corporate Philanthropy or Partnership), CSI (Corporate Social Investment), CSV (Corporate Shared Value) and more. The solution is to rearrange it as a spectrum. At one end of the spectrum is the hard edged advertising and marketing related type of corporate partnership at the other softer gentler fuzzier community, social and political objectives.
Your job as a fundraiser is to understand what opportunities your organisation can offer and where it fits in the spectrum. Once you know that, you are a better position to identify whom or what department to target. If you have opportunities that are going to drive sales, or enhance corporations product brands then you're at the hard edged and and you need to be talking to sales and marketing executives. If your organisation offers opportunities for corporate volunteering, then you probably want to be investigating the company's human resources Department. If your organisation has good government connections then you might offer opportunities for companies government or public affairs relationship building. If you are doing good in a particular community, especially one that is linked geographically to companies activities then you will probably be wanting to talk to corporate affairs.
Of course, one of the advantages your nonprofit may have is that you may have benefits at several different places on the spectrum to offer a company. Take for example a health charity that stages a public event, such as a marathon, that offers branding and product placement opportunities for a business partner. As well your nonprofit may have strong links with government health or welfare departments. Such links offer opportunities for business partners to be seen supporting a government backed initiative and may offer networking opportunities to develop relationships with officials. A major arts festival by which I was once employed offered both these opportunities. We worked alongside brand and product managers to achieve outcomes at the hard end of the spectrum and with corporate affairs directors and the CEO's office to facilitate networks and contacts at the other more subtle end.
The secrets to developing successful corporate partnerships is to understand your corporate partner. If you can get inside the company's skin, that is see and hear through the corporate executive's eyes and ears then you have a good chance of pitching an opportunity.
Note: Some paragraphs of this blog were first published as a NonProfit Quarterly Newswire on 21 July 2014
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