iOS app Android app More

Stephan B. Tanda

Stephan B. Tanda

Posted: April 19, 2010 08:13 AM

Are we seeing the end of 'corporate philanthropy'?

What's Your Reaction:

This week's gathering in San Francisco of the 9th Annual Global Philanthropy Forum Conference will bring together the leading voices from the NGO community, international aid organizations, and government and business. The conference is focused on access to health, food and water, and seems an opportune moment to take a step back and consider the state of corporate philanthropy more broadly.

Corporate philanthropy is not new - think Carnegie and Rockefeller - but it has become more important in recent years led by "mega" corporate philanthropists like Bill Gates and Warren Buffett. I will argue, however, that the nature of corporate philanthropy is undergoing a real transformation, to the point that for many companies, including the one I serve, the term has become slightly redundant. This transformation is being driven by two key trends.

Firstly, the immediate beneficiaries of corporate philanthropy are looking for more from their corporate partners than simply financial and product support. While such "off the shelf" support will continue to play a role, increasingly partners are looking for solutions that have been developed to meet their specific needs. They want access to knowledge and expertise that will help them formulate and implement their programs and develop their broader organizational strategies.

Secondly, companies are now realizing that there is more to be gained from engaging in philanthropic activities than simply enhancing their corporate reputations. Through correct partner selection and careful management, relationships can be used to drive innovation, enhance expertise, and strengthen and build business relationships.

This is precisely the approach that DSM has taken with its partnership with the World Food Programme (WFP). We have been working with the WFP for three years - the partnership has just been renewed - to help them deal with emergency situations and address the global problem of 'hidden hunger', a condition relating to lack of basic vitamins and minerals in the diet which affects around 2 billion people worldwide.

To address these challenges, DSM and WFP have trialled and tested new products and programmes, developed a more sophisticated understanding of the problem, and have been working hard to build awareness of the problem and available solutions. DSM also worked very closely with WFP during the design of its Nutrition Improvement Approach, which saw it focusing much more on including nutrient-rich food, in addition to food security (providing enough calories). Today, we are working together to address the nutrition needs of Haitians in the aftermath of the earthquake and on a longer-term food recovery program.

The classic objection to this approach is that it could involve the word "profit". Is it right to potentially profit from these types of activities down the road? Our answer to this question is straightforward. We are a business, it is our job to produce a return for our investors but, and this is a very important but, we believe that as a company we can do well by doing good. We also believe that, although our financial stakeholders are very important, we also have a moral obligation to people and planet as well. Balancing the needs of these stakeholders is fundamental to our business strategy.

In practical terms, this means that profit allows us to justify investing in innovations that can make a significant difference to human health and economic development and would not be available otherwise. Our work with the WFP will ultimately enable the development of viable nutrition markets in developing countries. This will create opportunities for us and local businesses and is the only long-term and sustainable solution for addressing the global problem of hidden hunger.

We have not come to the end of corporate philanthropy, far from it, but we are increasingly seeing the emergence of more sophisticated and broader partnership models, of which philanthropy is just one component. These new partnership models are, and will, deliver much more for both responsible businesses and the people and environments they are focused on.