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The Often Forgotten Downside to Accepting Corporate Contributions
“Go where the money is, ” said bank robber Willie Sutton. He could well have been advising nonprofits that target corporations flush in cash. Yet through the wrong partnerships nonprofits’ efficacy, reputation and goodwill is often looted while companies – who boost sales, gain new young customers, and burnish tarred legacies – make out like bandits.
The Occupy movement served as a stark reminder of the severe harm caused by Wall Street banks that collaborate closely with nonprofits. Recent campaigns harnessing technology achieved almost immediate policy shifts. This dynamic, complex world presents huge opportunities for nonprofits whose pursuit of visionary outcomes with like-minded partners has unprecedented potential. Yet many charities’ bias towards growth undercuts their impact. Two weeks ago, the Human Rights Campaign appointed Goldman CEO Lloyd Blankfein as their national corporate spokesperson for same-sex marriage, prompting widespread reactions of disgust including Matt Taibbi’s. Soda machines still man school hallways, and environmental organizations embrace companies that wreak ecological devastation. Nonprofits say shrinking government support and glowing goals justify such partnerships. But neither trump the need for community and character to lie at the heart of their mission.
Only a small percent of the nonprofit sector are in social change [or social justice] philanthropy, described in December’s Stanford Social Innovation article as one measured “by its capacity to question the dominant development model, to seek the root causes of inequality, and to engage in a process of self-reflection that also seeks to expand its accountability to the broader public that it seeks to serve." The traditional domain of industrial titans expanded as diverse groups created charitable forces of all stripes. But many nonprofits bloated by oversized assets and investments in new capacity narrowed previously innovative, high impact missions.
Nonprofits partners’ successes exacted a high cost on target communities (making the donations available). Explosive corporate growth resulted in large part from companies’ masking product costs and effects, weakening regulatory protection, and minimizing worker power; leaving Americans with stagnant wages, bigger waistlines, and a high risk of homelessness. The Great Recession slowed progress towards the Millenium Development Goals with 80 million more jobs needed to regain 2007-level employment. The planet hurtles towards an environmental point of no return, due largely to profits taken at the Earth’s expense.
Time for the powerful nonprofit sector – devoted to health, sustainability, and economic opportunity – to dump the Vichy water and rejoin the fight for justice alongside newfound partners. Yet many are closer to settling down for a nap after their Black-Card-funded lunch than answering the call to action.
Why? They ignored the simple fact that something as small as a kind gesture prompts reciprocity. Three pertinent examples: an institution where the name of Philip Morris is etched on a wall in gold is unlikely to put on Christopher Buckley’s brilliant take on lobbying “Thank You for Smoking”. And it is the rare development organization that would partner with Pepsi then highlight harmful health internationally, or take banking money then lobby hard for taxes on financial transactions and hedge fund managers. More likely it would pivot to change constituents, eliminating nutrition programs or anti-bank/anti-soda campaigns.
Advice for how an individual nonprofit can avoid such awkward situations is here. More promising is the nascent trend across sectors to question how best to achieve transformative impacts and visionary goals.
The environmental movement 1Sky, which includes Bill McKibben, issued this letter that gives more credence to community organizations. Mainstream organizations rallied hard to support national climate change legislation that was slashed to ribbons before failing to pass. Yet smaller organizations reached out to minorities, scoring a huge win with the defeat of Proposition 23, keeping California on target to meet aggressive greenhouse gas goals. A recent report argues that the last decade's enormous environment spending achieved little and progress requires more grassroots activism.
Arts organizations are beginning a dialogue about the scarcity of political theater, according to Woolly Mammoth Theatre Managing Director Jeffrey Herrmann. The provocative and often political DC playhouse has tackled AIDS, gentrification and political comedy, among other topics. In fact, the Woolly helped birth “The Agony and Ecstasy of Steve Jobs”. Mike Daisey’s prescient monologue based on his investigation into FoxConn has been followed by the explosion, audit and campaigns involving Apple products. The play virtually sold out in DC last year and returns soon, demonstrating its contemporary relevance and enduring social value.
The downside to supersizing has been known for some time, the pitfalls of bad partnerships even longer. Nonprofits have traditionally been respected for achieving near miracles. It’s time for them to renew their vision, roll up their sleeves, and work on issues critical to their communities. As for any inspired leader, both company and collaboration will come.