I’ve long been an advocate of corporate social responsibility and a believer that the corporation can be an agent for good in the world. Yes the goal of for-profit organizations is to make money and not to give money or time away. But reputation matters. According to BusinessWeek (July 9, 2007) “Reputation is a big reason Johnson & Johnson (JNJ ) trades at a much higher price-earnings ratio than Pfizer (PFE ), Procter & Gamble (PG ) than Unilever (UN ), and Exxon Mobil (XOM ) than Royal Dutch Shell (RDS ).”
At best, corporations are nothing more than groups of people coming together to do or create something of value to others. At worst they are sly groups of smart, privileged insiders scheming to separate lesser mortals from their money by any means possible. (Think Enron traders, gleefully jacking up the price of energy as the lights dimmed in California or any number of players in the sub-prime mortgage market.) But – and perhaps I’m being overly optimistic – the multi-national corporation could be an antidote to nationalism or parochialism. People whose governments can’t get along manage to work side by side to accomplish shared goals.
The challenges for NGOs and other organizations that get CSR funding are many: The money usually comes with strings and outsized egos attached; corporate donors can be fickle, changing priorities to match their new products and services or cutting back on commitments when business is bad; and the real human beings for whose benefit the NGO exists may become secondary to the negotiations between the corporate donor and the NGO leadership. As NGO leaders cozy up to corporate donors, they may help sanitize well-earned bad reputations.
On the other hand, if a community doesn’t have access to clean water or primary health care; if they need resources like fertilizers and better seeds to increase crop production — who cares where the money comes from. I forget where I read this – but it’s obvious: When your neighbor’s house is on fire, you don’t haggle over the value of your hose. Put out the fire.
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