by Maria Baldauf
When nonprofits think of corporate-nonprofit partnerships, the first things that often comes to mind are money and marketing. Perhaps you think of the Komen Foundation’s pink ribbon campaign, with everything from Yoplait’s “Save Lids to Save Lives” to Ford’s “Warriors in Pink” limited edition V-6 Mustang. These traditional corporate-nonprofit partnerships provide the nonprofit with funding, increased visibility and promotional opportunities, while allowing the corporation to be associated with the good name of the nonprofit to enhance its reputation and increase its sales.
Funding and marketing, however—as good as they are for nonprofits—are not the only reasons to work with the private sector. Corporate-nonprofit partnerships may also help your organization directly fulfill its mission. However, this form of partnership is far too underutilized by nonprofits. But why? Well, this may be the case for several reasons. First, there may be a lack of nonprofit CEO or organizational buy-in. Either top executives, the board, or several staff members consider a corporate-nonprofit partnership too risky or counter to its mission. Nonprofit leaders are afraid of getting flak from the community, funders, or other nonprofits for “working with the enemy.” Second, when developing nonprofit strategic plans, corporate partnerships rarely come to mind as a way to achieve the organization’s mission. More commonly, the idea comes later, in the operational plan on how to carry out the strategies, thus limiting partnerships to their marketing and funding roles. Finally, the organization and its leaders don’t think they can get the company to change, either at all or to their desired level. After all, what is the point of trying if they’re not going to listen? The nonprofit would rather do a negative campaign, which, it is thought, will be more effective and won’t alienate current supporters. In reality, though, substantive change is rarely achieved as a result of negative campaigns. In order to achieve social change, nonprofits need to stop generalizing businesses as villains that work counter to their missions, and start realizing that many businesses have the knowledge and skills to do many things better, faster and with lower overhead. Businesses, on the other hand, need to realize that utilizing advertising and public relations to sidestep social concerns for which they are blamed is not sufficient, and that ‘doing good’ is an opportunity as opposed to a risk to be managed with the least possible investment. Indeed, businesses are increasingly realizing the importance of protecting rather than destroying the ecosystems on which they depend for physical capital and of supporting rather than neglecting the communities and livelihoods on which they depend for human capital.
As a result, the goal of this paper is to advocate that nonprofits overcome their fears and embrace mission-focused nonprofit-corporate partnerships by exploring several examples of partnerships. This is not to say they are not challenging—they are, but if done right, they are well worth the work and not as risky as many may think.
City Year and Timberland: Promoting a Corporate Culture of Volunteerism
Let’s begin with City Year and Timberland. If you’re a nonprofit organization and think you’re too small to work with a corporation, this example might change your mind. While a partnership may begin small, with an initial donation of a mere 50 pairs of boots, as is the case with City Year and Timberland, it can evolve over time into a long-term commitment to an organizations mission–in this case, into a shared culture of community service. In addition to more than $10 million in resources over the years, Timberland became so inspired by City Year and its corps members that, in 1992, the CEO of Timberland initiated the Social Enterprise Department that includes the now well-known Path of Service program, which provides employees with 40 hours of paid time off for community service each year as well as a Service Sabbatical program that allows each employee six months of paid leave to serve nonprofits, schools, and community organizations. Both of these initiatives fit right in line with City Year’s two key programs: (1) Engaging youth aged 17 to 24 in a 10-month commitment to full-time community service; and (2) Engaging people in city-wide service days to complete projects that revitalize communities and foster a spirit of civic engagement. Several additional companies now also participate in this program.
It is these very programs that Timberland has adopted that serve as major draws for highly-qualified individuals to want to work for the company. This example is illustrative of a larger trend that people would prefer to work for socially responsible companies who provide opportunities for employees to engage with nonprofits. In fact, a “survey of graduating MBAs at top business schools found that 97% would be willing to make a financial sacrifice to work for a company that is socially responsible” (Boccalandro, 2008). Further, a similar study by Deloitte also found that “62% of respondents prefer to work for a company that provides opportunities to apply skills to benefit nonprofit organizations” (Boccalandro, 2008).
But let’s face it, successful partnerships aren’t easy to establish or to maintain. If there wasn’t an open stream of communication and support from both the top and from all levels of Timberland and City Year, then the partnership surely could have failed. Likewise, if Timberland’s CEO had become entrenched and unwilling to leave, or too overpowering when serving as the chair of City Year’s board of trustees, things could certainly have taken a turn for the worse. But because the partnership was managed so well, developed gradually over time, and had the full commitment of both organizations at all levels, it has worked very well so far and is likely to continue to work for years to come.
EDF and McDonalds: Saving Money and the Environment
Not all partnerships have to be long-term. Some are initiated simply to achieve a short-term goal, such as with the Environmental Defense Fund (EDF) and McDonald’s. It all began in 1989 when, at the request of EDF, the president of McDonald’s USA met with the executive director of EDF to discuss McDonald’s environmental footprint as a result of its waste management practices. This initial meeting was followed by several follow-up meetings and tours of McDonald’s facilities. These meetings built a working relationship and trust between the two, which laid the foundation for their work to reduce McDonald’s solid waste. This relationship was particularly important for McDonald’s, who was opening itself up to an unprecedented level of scrutiny by an outside organization. It was also important for EDF, who was facing criticism by more radical organizations such as the Citizens Clearinghouse for Hazardous Waste (whose earlier attempted partnership with McDonald’s failed) for becoming too willing to compromise with corporate interests. In spite of these risks, however, the partnership was launched and by the end of 1990, together, they had (1) reduced the packaging volume for sandwiches by approximately 80 percent by converting from plastic clam-shell packaging to unbleached paper carry-out bags; (2) reduced napkin usage by 21 percent and incorporated 30 percent post-consumer recycled content; and (3) strongly urged their suppliers to incorporate 35 percent post-consumer recycled content in all their corrugated shipping boxes. McDonald’s also replaced many of their disposable storage containers with reusable bulk storage systems and began to use pump-style condiment dispensers instead of individual packets.
The success of this partnership was not only built on the relationship, but from the very beginning, there was also a recognition by both sides of the value that each party brought to the table. EDF recognized McDonald’s existing initiatives in recycling and interest in going further, while McDonald’s recognized EDF’s expertise in solid waste management. However, the partnership was not all smooth sailing. As might be expected, there were many conflicting opinions and interests involved. Most notably, there was significant debate within McDonald’s over whether it should make the switch from the environmentally damaging clamshell sandwich containers to unbleached paper bags. In addition to the company’s environmental values, it also had corporate values of quality and supplier relationships. Ultimately, with the help of EDF, McDonald’s made the environmentally right choice that happened to also decrease its costs, and weathered the backlash from those hurt by the decision, including competitors and the plastics industry. In spite of these hurdles, the partnership survived and success was realized.
Danone and Grameen: Business Innovation for Poverty Alleviation
Corporate-nonprofit partnerships are, of course, not unique to the United States. One of the most well-known examples of a global corporate-nonprofit partnership is between a French food-products company famous for its yogurt and a Bangladeshi nonprofit famous for microlending as a means to poverty alleviation. The goal of the partnership was not only to develop a yogurt that some of the poorest consumers in the world could afford, but to do it in an environmentally friendly fashion and on a small scale. What’s more is that the yogurt had to provide the poor with 30 percent of their minimum daily requirement for iron as well as provide other nutrients, and still remain sweet enough for the local Bangladeshi’s taste buds. All of this, for a product that would retail for a mere 10 cents per serving. To achieve this goal, both Danone and Grameen had to bring their different strengths to the table. Grameen stepped in, for example, when it became clear that developing a reliable supply of milk would be a challenge. Since most local farmers were too poor to buy feed to increase their cows’ milk production, Grameen Bank helped them obtain microloans. Danone, on the other hand, tasked its production specialist with the responsibility of designing the factory. Developing the yogurt, however, was a joint venture in which Danone developed several versions of yogurt, which Grameen tested in the field and received feedback that it reported back to Danone so that they could make adjustments until they got the yogurt just right. Together, Grameen and Danone met the innovation challenges to achieve their goal.
The next goal is for this enterprise to become profitable for Danone in the long-run. Current estimates by the Grameen-Danone partnership predict they will break even by mid-2010. However, rising costs for agricultural goods may force Danone to raise prices on the yogurt or push back their projection for profitability another year or two. Still, the Grameen-Danone partnership serves as a unique example of how the nonprofit and business sectors can work together to alleviate poverty. This venture philanthropy may be a new trend for businesses entering markets in developing countries.
Ashoka and Law Firms: Promoting a Global Culture of Pro Bono
If you have ever met an Ashoka Fellow or even heard a story about one, you know why senior lawyers from some of the nation’s top law firms enjoy working for free to help these inspiring individuals change the world. Ashoka is a nonprofit organization that has funded and supported more than 2,000 social entrepreneurs in 63 countries around the world. Law for All provides support for Fellows around public policy and legal issues. Advocates for Social Entrepreneurs, a Law for All program, connects Ashoka Fellows in need of legal support to law firms and legal networks with lawyers willing to help them address their legal needs on a pro bono basis. There are 50 participating law firms and legal networks, including Latham & Watkins, Morrison & Forester, Lex Mundi Foundation, Mayer Brown LLP, DLA Piper, and Weil, Gotshal & Manges. Lawyers have worked on issues ranging from intellectual property to human rights law to nonprofit incorporation.
What makes this partnership so appealing for lawyers is the caliber of the social entrepreneurs and the incredible impact of their work. Participating law firms market their partnership with Ashoka and the legal assistance provided to inspiring fellows such as Edith Grynszpancholc, who is working to improve access to medical care in rural areas of Argentina for children who have been diagnosed with pediatric cancer. After realizing significant success in her own country, Edith seeks to expand her work across Latin America and the Caribbean. However, to do so, she needs help understanding the laws of various countries surrounding health care generally and, more specifically, laws in relation to children’s cancer treatment. Ashoka’s Law for All initiative has connected Edit with legal counsel from the Cyrus R. Vance Center for International Justice so that she can realize her goals for growth outside of Argentina. Also important to the partnership between Ashoka’s Law for All initiative and law firms is the culture of pro bono that has developed in the United States and a few other countries in the world. Firms engage in pro bono law not only out of a commitment to helping others, but also because it helps their firms develop expertise, as explained by Steve Kahn, a partner at Weil, Gotshal & Manges LLP:
“I believe in social responsibility, and in that context, I believe that lawyers in a society governed by law have a responsibility to provide legal services to people who need them. If people can’t pay for the services, they should be provided on a pro bono basis. Pro bono work can also be personally and professionally enriching for lawyers, introducing them to new areas of law and viewpoints different from those they experience in their other professional work. Further, Ashoka Fellows are smart, energetic and creative changemakers. Giving them pro bono legal help makes exciting changes possible.”
As highlighted by Steve, this kind of partnership facilitates “skills-based volunteering” opportunities for lawyers, which provides direct value to the firm. At the firm level, this may strengthen the firm’s expertise and reputation in its international law practice. At the individual level, skills-based volunteering may help employees gain the skills and experience needed to receive a promotion and take on new responsibilities in the law firm. It is also likely to help law firms attract and retain some of the brightest lawyers in the country, thus decreasing its human resources costs and improving its reputation.
Global Network Initiative: Protecting International Freedom & Privacy
Prior to the Global Network Initiative, information and communications technology (ICT) multinational corporations operating in China, Africa, the Middle East and elsewhere conformed with government pressure to comply with domestic censorship laws that violated international human rights laws and standards. In their defense, these corporations believed that in order to do business in these countries, they needed to comply with their laws. Complying with the surveillance efforts of these countries, however, resulted not only in bad press in the U.S. and Europe, but also led to accusations from the U.S. Congress. Yahoo, for instance, was accused of helping Chinese police identify ‘dissidents’ whose crime was supposedly expressing their views online. Google, on the other hand, was accused of complying with Chinese government demands to eliminate certain topics such as democracy and Tiananmen Square from Google search results in the country. Yahoo and Google are not alone, of course. Several ICT firms, including Microsoft and Cisco, have been criticized for similar activities.
The Global Network Initiative was formed to help companies resist this pressure to comply with foreign governments in areas that violate international laws and standards in the ICT sector. Participating members include a myriad of companies, civil society organizations, investors and academic institutions, including Google, Microsoft, Yahoo, Human Rights Watch, the Berkman Center for Internet & Society at Harvard Law School, and the Committee to Protect Journalists. The Initiative is lead by an independent nonprofit organization that was created specifically to oversee the activities of this initiative. The nonprofit’s board of directors consists of an equal representation of company and non-company members. The Initiative is currently funded by the participating companies, each of which have committed to donating an initial $100,000 per year. Last October, Google, Microsoft and Yahoo jointly announced a co-created code of conduct to defend and promote freedom of expression and privacy online. As members of the initiative, these companies are required to narrowly interpret government requests for information and to minimize cooperation with government censorship efforts. Furthermore, members of the Initiative “promise to reveal attempts by governments to pressure them into violating worldwide standards regarding online privacy or access to information.”
This new initiative has a long way to go, but it is off to a good and promising start. There are still some organizations, such as Reporters Without Borders, who have declined to join the Initiative because, in their opinion, it does not go far enough to protect Internet freedoms in oppressive countries. However, since it is so new, it may be too soon to draw lessons learned from their progress. The hope is that the future will show that these large-scale partnerships can be successful, even if there are a few bumps along the way.
Business for Innovative Climate and Energy Policy (BICEP)
Imagine the surprise of environmental groups when they heard that a coalition of businesses was being formed to address climate change. This, however, is nothing new to Ceres, a nonprofit national network of investors, environmental organizations and other public interest groups that works to address sustainability challenges. Ceres is known for its work with companies like Dell, which it encouraged to support national legislation requiring electronic recycling programs in 2006. One of its newest initiatives is BICEP, which stands for Business for Innovative Climate and Energy Policy. From the perspectives of nonprofit organizations, the approach used by BICEP ought to be viewed as ingenious and as the next big idea for advocacy initiatives. The basic idea here is that one nonprofit, as opposed to merely lobbying with its small budget against large corporate interests, can actually convince businesses of their policy position and join forces with those who share their view to significantly magnify their impact. And, remember, businesses are not restricted in how much of their private money they may spend on lobbying.
Since November 2008, the founding members of BICEP—Levi Strauss, Nike, Starbucks, Sun Microsystems and Timberland—have advocated for a federal cap-and-trade system, for limits on the construction of new coal-fired power plants that do not utilize carbon-capture technologies, and for the Renewable Electricity Standard that would require at least 20 percent of U.S. energy to come from renewable sources by 2020. Since November, Gap, eBay and Symantec Corp. have also joined this coalition. What links these companies is not only their environmental consciousness, but also their belief that it is best to be involved in the policy processes that will inevitably impact their businesses. Starbucks, for instance, notes that “climate change is a threat to any business that relies on an agricultural product like we do with coffee.” Other environmental organizations agree and are urging other corporations to join the coalition. Dan Lashof at the National Resources Defense Council says that “the companies involved in BICEP are ahead of the curve from both a business and environmental perspective… a national limit on global warming is coming; the companies that anticipate and help shape the limit will have a competitive advantage over those who refuse to move forward.” The businesses involved couldn’t agree more. And here is a lesson to be learned—if you want businesses to get involved with your nonprofit in coalitions such as this one, you need to understand what motivates them and that is, of course, profit. Here is the business case for BICEP:
“Businesses should care about putting a strong energy and climate policy framework in place because, without it, they face negative impacts to their bottom lines, whereas with it, there are new opportunities and markets they can tap into. Climate change poses significant risks to the long-term sustainability of businesses and the countries and communities in which they operate. The impacts of climate change will harm supply chains, which will increase costs and decrease demand for products. Furthermore, it is difficult for businesses to operate unless they can plan for the future. To plan for the future, businesses need a stable set of national climate and energy policies. It is imperative, then, for businesses to call on the U.S. government and governments around the world to enact bold climate and energy policies, so that they (along with their customers and suppliers) can enjoy the multiple benefits that such policies will deliver—a cleaner and healthier environment, more stable energy prices, greater security and more good jobs.”
Conclusion
These partnerships have illustrated many best practices for any nonprofit that wishes to work with a corporation, or even for corporations that seek out work with nonprofits—from needing to understand the business case to the need for both parties to view each other with respect and understand that they each have different areas of expertise to contribute to the partnership. The business case, however, may vary widely. For City Year, it was largely the fact that Timberland could attract and retain better employees as a result of their civic engagement. For Ashoka, it was important both for the law firms and their lawyers to build their capacity and reputations both by working on social issues around the world and by strengthening their expertise in particular practice areas. Meanwhile, for BICEP, it was about having a voice in creating the laws that would inevitably impact their businesses’ bottom lines and the customers they serve.
Overall, these examples illustrate that learning how to work with the private sector is well worth it, as partnerships can bring triple bottom line results for the company, society and the environment. To achieve this, however, it is vital that nonprofits come to the partnership with an open mind more eager to learn than to judge. Additionally, there needs to be a stream of open and coordinated communication, shared accountability, executive buy-in, and a strong commitment from both sides. Finally, both sides will need to agree on the scope and scale of the partnership. That is, is this a one-time partnership to achieve a specific goal, or is this a long-term strategic partnership? Of course, partnerships may evolve over time, but at every step along the way, the parties involved in the partnership should be on the same page.
The ultimate opportunity to achieve your mission is greatest of all. If by working with businesses—who will likely also fund your organization—you can reduce poverty, decrease greenhouse gas emissions, or save people’s lives, then it is unambiguously the right thing to do. It rings at the core of why you exist—your mission. As stated well by Bea Boccalandro, “it seems narrow-minded to continue to confront… [this] sobering long list of ills we face with one quarter of our collective might.” Working with businesses can help nonprofits scale the good that they do and serve thousands or even millions more people.
