strategic philanthropy by abe2


									STAWAR: Is mankind our business?
By TERRY STAWAR, Local Columnist

   — Although we enjoy a bargain, Americans hate being thought         million in contributions and Indiana’s Eli Lilly and Company,
of as cheap. After the devastating 2004 Asian tsunami struck, a        which gave more than $25 million.
United Nations official caused a big stink when he referred to the        There maybe a cloud over the corporate giving scene, however.
wealthy nations of the world as “stingy.”                                 Over the past several years many companies have adopted a
   President Bush took this quite personally and Americans             method of charitable giving that resembles government’s use of
everywhere had their noses out of joint. Conservative editorial        foreign aid. Under the rubric “strategic philanthropy”, this
writers across the country defensively pointed out that U.S.           approach stresses accountability and outcomes, but more
governmental aid has steadily increased over the years, as have        pointedly aims at aligning corporate interests with charitable
private American donations.                                            contributions. Corporate strategy guru, Michael Porter claims that
   However, back in 1970 the U.N. General Assembly                     companies have ignored strategic opportunities that can benefit
overwhelmingly adopted .7 percent of gross national product as a       both the organization and society.
reasonable contribution goal for wealthy countries. Since then            I suppose it is only reasonable for a company to donate its
America has never contributed beyond the .4 percent to .5 percent      money in such a way that most benefits, not only recipients, but
level and the percentage actually dropped to about .15 percent in      also shareholders, since that is management’s primary obligation
2004, when the average for all donor countries was .41 percent of      in a for-profit company. But there is also something rather cynical
GNP.                                                                   about it. A recent advertisement for a workshop on how to mount
   As GNP has increased, American giving, simply has not kept          an effective strategic philanthropy campaign states, “In this
pace. If we paid our income taxes in the same way, instead of          program you will learn how to design a strategic philanthropy
being called “stingy,” the IRS would have another word for us —        program that has bottom-line impact on the company…”.
“defendant.”                                                           “Bottom-line impact”, now there is a phrase that really warms the
   In her article the “Stingy Samaritans,” Pekka Hirvonen from         heart. With apologies to Charles Dickens, perhaps it is time to
the University of Helsinki speculates that this relative decrease in   update a classic tale of corporate charity:
international aid was caused by the end of the cold war. The U.S          “At this season of the year, Mr. Scrooge,” said the portly
and its rivals typically employed foreign aid strategically, to        gentleman, taking up a pen, “it is more than usually desirable that
further political and ideological aims. With the collapse of the       we should make some slight provision for the poor and destitute.
Soviet Union, however, the competitive spur to such contributing       A few of us are endeavoring to raise a fund to buy the poor some
was lost. You see we are not stingy, but without the fear of           meat and drink.” he said with a wink. “What shall I put you down
communism, we lack motivation. The threat of terrorism has             for?” “Nothing!” Scrooge replied. “I don’t make merry myself
started picking up some of this slack, however with the massive        and I can’t afford to make idle people merry.”
aid earmarked for Pakistan, Afghanistan, and, of course, the              “Ah, I see you misconstrue our meaning, good sir.
money pit that is Iraq.                                                   “We at the Mankind is Our Business Foundation propose an
   In another example of how people hated to be called stingy,         entirely new concept — strategic philanthropy — a means of
Bostonians recently objected to the Catalogue of Philanthropy’s        providing for the poor that has bottom-line impact for your
Annual Generosity Index, in which Massachusetts consistently           counting house.” “Bah, how is such a thing possible?” Scrooge
ranked at the bottom of the generosity barrel.                         inquired doubtfully.
   To address this affront to New England pride, the Boston               “You simply donate 100 crowns to us and then we use it to buy
Foundation commissioned a study. Not surprisingly this 48 page         victuals for the poor at several butchers and green grocers. In
report concluded that the Generosity Index was biased. New             exchange for our very lucrative business, they agree to arrange all
measures were devised and guess what? Their anticlimactic              their future financing with our munificent benefactor — namely,
conclusion was that “Massachusetts residents are more charitable       Scrooge and Marley’s, and at highly exorbitant interest rates, I
than the Generosity Index ranked them.” In this report                 might add. Also your original 100 crown donation is tax
Massachusetts’s ranking rose from 49th to 11th. I think the            deductible as a charitable contribution.” “Capital!” exclaimed
Boston Foundations’ money would have been better spent, if they        Scrooge rubbing his hands together. “This strategic philanthropy
gave it to an actual charity, instead of academic hired guns.          is no humbug.”
   Indiana, with an average annual charitable donation of $1,257       Terry L. Stawar, Ed.D. lives in Georgetown and is the CEO of LifeSpring
per household ranked No. 25 of 50 states on the 2002 Index. We         in Jeffersonville. He can be reached at or 812-206-
fared much poorer with the revised Boston calculations, dropping       1234
all the way to 43. Perhaps we need to finance our own report.          Published February 01, 2007
   Finally in addition to governmental and individual donors,
America’s 2,600 corporate foundations gave a record $3.6 billion
in 2005, a 6 percent increase over the previous year. Wal-Mart
topped the list giving away more than $156 million. Among the
top twenty-five corporate givers in 2005 were UPS, with $36

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