29 December 2008 ~ 2 Comments

Tell us YOUR opinion

General NGOs Responsible Giving

If a businessman rakes in a hefty profit while doing good works, is that charity or greed? Do you applaud or hiss?

Share your thoughts.

http://www.nytimes.com/2008/12/25/opinion/25kristof.html?th&emc=th
http://community.nytimes.com/article/comments/2008/12/25/opinion/25kristof.html

  • Karina Kloos

    As someone has already commented, “Does the means justify the ends?… sometimes.”

    There’s nothing wrong with a for-profit company doing social good. In fact, we’re one of them! (PEPY Tours) and Cambodia is teeming with them, as well. I’ve recently arrived from San Francisco, which I consider one of the central forces in this movement with the socially and environmentally active living with the entrepreneurial-inspired and philanthropic folks, the convergence of the social (“nonprofit”) and business (“for profit”) sectors. I felt like everywhere I turned, someone had a new idea for a social venture. Cambodia’s streets are lined with them, too. That’s awesome. Usually.

    I worked with a small “for-profit business” that consulted with “nonprofit organizations”, called “For Impact”. The name really says it all in that your organization’s defining characteristic shouldn’t be about whether or not you make a profit, it should be defined by your contribution to society. Pallotta makes a valid point in that businesses know how to do business. To some degree, the professionalization of the social sector is helping to improve the effectiveness of nonprofit organizations, thus helping them to make a greater social impact. If that’s what he’s doing with his business, fantastic. And, to his point, if you want someone to run a multi-million dollar budgeted, several thousand employee organization well, you need to hire someone with the skills. I’m not bothered by someone being paid well to do a good job.

    My frustration is that our standards of being paid well are ridiculous. That’s my first gripe. Secondly, and my challenge to him and anyone else in that situation, is what kind of business are you running where excessive profits are so necessary? I was recently at the San Francisco Corporate Philanthropy Summit where the top 70 businesses in San Francisco were awarded for their giving. AT&T was the big winner. Congratulations. They gave over $20m to San Francisco’s social organizations that year. That was less than 1% of their profits. And there was a room full of people awarding them with a trophy for it. I was appalled. Why is it necessary to run a business where profits are exceedingly excessive? Because that’s the capitalist model driven into us from birth.

    To me, that’s the issue. In addition to corporate social giving and social ventures, my hope is that this convergence of sectors and re-birth of social activism (I would argue the wave came in the 60’s, died in the 80’s and is making its way back) will offer lessons to the business world as well; it won’t just be about making nonprofits more like businesses, but about bringing social consciousness and common sense to businesses and society at large: the billion dollar business man will no longer be revered.

  • Daniela Papi

    For me, the question isn’t if you are for profit or not, but are you doing what you claim to do. Is a company marketing itself as an organization which is “doing good” and giving large scale support to the causes it shows on its website and then not following through with significant support? For profit or not, if they are using images on their website which tug at the heart strings (children in orphanages, the world’s poor, etc) and yet are keeping the profits and only passing a small amount on, they are not an organization I want to support. If a group is transparent about where their funding is going, saying “5% of our profits go to XXX cause” or “20% of the funds you raise for this ride go to supporting Aids research” then that is ok in my book. Being transparent so that people know what they are signing up for is the key. Kristof’s reference to the Aids ride is one of those groups which has crossed the line, in my opinion. Not because they are only giving a small amount of their profits to Aids research, that is ok, but because they are MARKETING themselves as a charity ride and the small percentage which goes on to the cause it not transparent on their site.

    The more transparent we can all be, non-profit or not, the less complaints we will get from people who feel like the did not get what they signed up for. Running PEPY Tours, we are faced with this on a regular basis and we are working to make our site and our programs more transparent as well.