The concept of “strategic philanthropy” has gained increased acceptance since the days when people felt that giving from the heart was somehow less “pure” if a more robust decision-making process were applied. But with companies facing a myriad of choices, making a decision about which charitable causes to support comes down to an investment of company time and resources—and therefore ought to be subjected to criteria similar to other business decisions. Conversely, an NGO should use the same robust criteria when selecting their own partners.
When you partner with a not-for-profit organization it is important to remember that you are entering into a relationship. Applying a few standards will help determine the success of the partnership over the long term.
There are a few strategic questions you need to ask before you enter into any partnership with an NGO.
1) Does the NGO support the long-term vision and strategy of the company? There are some NGOs whose mission may be at odds with parts of your business model. They may seek to partner with you in an effort to promote changes to your business. If you’re open to evolving your business, this may be a good relationship. But if you’re partnering with them in an attempt to appease or blunt criticism, this may be akin to the Trojans bringing the wooden horse into their city.
2) Is it compatible with the day-to-day reality of the way your business operates? Partnerships on paper may make logical sense, but they have to work on a regular basis. Your operations and operators must be able to work with the charity in a way that is compatible at the grassroots level.
3) Will it engage and inspire employees at all levels? A philanthropic relationship that involves your core products and services can be a great reminder to your workforce of the value their work has every day to people in the community and around the world. So often we get caught up in production schedules that we forget that what we do and make has a positive impact on peoples’ lives. Any relationship that simply involves writing a check and reporting in the annual report will not engage employees or promote morale as much as them being allowed to use their skills and to meet the people who will benefit from their involvement.
4) Will it provide tangible, measurable credible results? This comes down to ROI. What is the impact of the program? Nothing makes employees more proud than being able to see with their own eyes the positive benefit that they have helped create. Knowing that your company helped build a school, fixed up houses, cleaned a park or streambed, etc., and seeing that every day is a source of pride. At the same time, stakeholders demand that commitments are measured and reported rather than simply stated without validation. If you’re reducing emissions or pollutants, knowing how much you have saved is important.
5) Will your stakeholders recognize it as a strategic and appropriate use of your resources, products, skills and otherwise believe that what you're doing is important, effective and appropriate? Employees, shareholders, suppliers and the community will understand and respect a strategic program more than being told that the support is based on one individual’s (or even a group’s) emotional decision. That is the difference between charity (heart-based giving) and strategic philanthropy. And your stakeholders expect you to be strategic.
Beyond the strategic questions, there are also come tactical considerations.
6) Does the NGO have a successful track record working with corporations? Some groups have worked successfully with the for-profit sector for years. Others have, at their core, a fear of (or at least a distrust) of business in general. Neither is good or bad, but I have always found that partners that understand, respect and have experience working with the for-profit sector are more open to partnership models that meet both organizations’ needs.
7) What is the NGOs true mission? Is it compatible with your business model? There are some organizations that may have a more radical agenda than it appears on the surface. Their image may be much less stringent or demanding than they are in reality. Entering a partnership based simply on the organization’s reputation may ultimately lead to stressful situations. And, of course, once you have entered a partnership with an organization, there is a danger not only in the uncomfortable relationship, but also being the business that was dropped by a beloved organization. That can damage your reputation and brand. Do your homework and due diligence and treat this as any other partnership relationship. Always check their mission and the people on their leadership team. It also behooves you to look at their annual report to determine where they get their funding.
8) What is the reputation of the NGO? Is it considered worthy or credible? Some organizations have very positive images in the mind of the public. Others may have been tarnished over the years or be recent actions. If your partner suddenly is in the news for fiscal mismanagement or the conduct of its executives, being associated with them may cause people to question your acumen. Or you may be able to work with a worthy cause that has had some recent short-term issues and demonstrate to the community that you believe in their new management. And depending on the size of your organization and the one you’re partnering with, this may require a closer look. Interbrand does studies that provide insight into NGOs’ image and reputation.
Strategic partnerships between business and philanthropy can be incredibly effective and add value to employee morale, the value a company brings to the communities in which it operates and can help further the good work of not-for-profit organizations. Proper alignment is essential to make these partnerships strategic and effective.
John Friedman is co-founder of the Sustainable Business Network of Washington (SBNOW). He is a communications and sustainability professional with more than 20 years' experience, including developing successful multinational partnerships between corporations and not-for-profit organizations. He can be reached at JohnF@sbnow.org.