Companies find profit and charity don't have to be mutually exclusive
August 16, 2010
By Crain's Chicago Business
Quid pro quo used to be as verboten in corporate giving as it is in politics, but experts say a shift in priorities, as well as some economic hard times, have businesses unapologetically giving funding priority to projects that have the potential to boost the bottom line.
“The market values social change, and businesses are realizing it is OK to exact an economic return for doing good,” says Jason Saul, a Chicago consultant and professor at Northwestern University's Kellogg School of Management.
Excerpt:
According to Laurie Marsh, president of the Nalco Foundation, the company—with 11,500 employees and 2009 revenue of $4.2 billion—also supports a worldwide volunteer program, providing paid time off to six employees this year who will be sent on two-week missions to help install water-treatment facilities in drought areas.
While the basic water systems Nalco is helping to put in place are not potential moneymakers for the company—which provides complex water- and process-treatment systems for commercial purposes such as paper mills and manufacturing facilities—a company spokesman acknowledges that much of the philanthropic effort is focused on regions Nalco is targeting for expansion, including India and Latin America. And providing better stewardship of a scarce resource in these regions for consumers now may help make more of it available for commercial use in the future.
Katie Scolari Borden, director of resource development at Water For People, says the combination of technical skills and economic motivation provided by companies like Nalco are essential to the organization's mission of ending “water poverty” around the world.
“We don't believe charity alone will solve this problem,” Ms. Borden says. She adds that while it is too early to tell if this investment will pay off for Nalco, it is giving the company a presence in a strategic market, and at least one product developed for the project—an easy-to-use water-quality testing kit—likely will be used in future Water For People efforts.
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