Over the past decade, the concept of corporate social responsibility (CSR) has been pummelled and massaged to suit countless agendas. Both campaigners and corporates thumb their noses at a term whose meaning zigzags from ethical supply chains to carbon trading to human rights. But behind evolving definitions of CSR is a crude formula: charities need funds and companies need kudos.
Scrutiny by the NGO sector of corporates such as Shell and Gap has mobilised firms to align charitable and community activities with core business strategy. Companies are being judged on ethical business practices towards staff, customers, suppliers, local communities and host countries rather than the size of their cheques to charity.
‘Corporate social responsibility has moved on from knocking on doors, cold-calling and asking for donations,” says Catherine Sermon from Business in the Community, a charity that helps companies improve their impact on society. ‘There’s been a big mindset shift towards shared goals and common objectives.”
Jason Suckley, head of corporate partnerships at Macmillan Cancer Support, says many charities are failing to get to grips with the programme. ‘There are still charities out there that rely on philanthropic principles … which are being replaced by CSR investment and business wants a return from that investment. The challenge there for charities is to be able to get a real understanding of the objectives of the corporate,” he says.
The traditional, money-spinning mechanisms remain sponsorship, charity-of-the-year partnerships, philanthropic donations and cause-related marketing. One celebrated customer relationship management strategy is that of Marks & Spencer and Breakthrough Breast Cancer. This raised nearly $4million in 2005/06, or 8% of the charity’s total income. The tie-in exploited both parties’ expertise and core female customer base, and led to the launch of a lingerie range designed for women who have had mastectomies.
The debate over the rights and wrongs of CSR has raged for years. Some campaign groups, such as Greenpeace, refuse to accept corporate or government donations for fear of bias. At the other end of the scale, Campaign Against Arms Trade’s annual Clean Investment list reveals the names of scores of United Kingdom charities which hold shares or investments in arms exporters such as BAE Systems.
Others are happy to work with energy companies. World Wildlife Fund (WWF) lists nuclear, oil and gas companies in its non-investment policy. The charity and HSBC bank side-eyed each other for 18 months before committing to work together on a five-year freshwater conservation partnership. In turn, WWF seconded an environmental analyst for three years to advise on HSBC’s sustainable investment policy.
But are ‘corporate citizens” always the swashbuckling saviours? While cash and in-kind donations by the UK’s top 500 corporate donors grew by 15% in real terms in 2004/05, to $2billion, this did not match the hike in company profits, which soared by 31%. Donations as a proportion of pre-tax profits dropped for the third consecutive year to 0,8% in 2004/05, according to the latest figures by the Charities Aid Foundation.
In an increasingly competitive fundraising market, partnerships can be unequal. Charities often underestimate the value their brand can bring to a company or industry fighting criticism.
The trick to successful partnerships, says Liz Markus of Think Consulting Solutions, is to think laterally. ‘Few companies now see pure philanthropy as their responsibility. But what they can deliver beyond funding is huge: a skills base to help with IT, planning and financial management, high street communication channels for access to customers, influence with supply chains and donations of goods and services. Charities just need to be creative.” —