Role of business: Change society or make a profit?

Consumers think corporations have a responsibility to change society for the better, but one observer notes that corporate giving is not about giving back but about making money for shareholders.

In a Global Corporate Responsibility Opportunity Study cited in Katya’s Non-profit Marketing Blog, consumers said corporations should “consider total stakeholder value, not just total shareholder value.” Almost all (93 percent) said “companies must go beyond the minimum standards required by law to operate responsibly and that businesses should do something in the communities in which they operate.” Most (81 percent) said companies “should do even more, including:

  • Change the way they operate to align with greater social and environmental needs
  • Support larger issues with donations & time
  • Advocate for change”

The study reported that “American consumers want companies to have a positive impact on society, but they have differing opinions about what role companies should play, including:

  • Advocate for change (27%)
  • Support larger issues through donations (24%)
  • Play a more limited role in society (23%)
  • Change the way they operate to align with bigger social and environmental needs (20%)”

However, as Michael Rosen points out in Michael Rosen Says, “There is no such thing as corporate philanthropy!”

Rosen said, “many nonprofit professionals seem to think that one component of CSR (corporate social responsibility) should be corporate philanthropy; they think that corporations should ‘give back.’

“However, that’s not why corporations exist. Again, they exist to make money for their shareholders, not to perform selfless acts of charity.

“If you want to raise more corporate dollars, especially during these challenging times, don’t submit a grant proposal simply thinking that a corporation should give-back by giving to your organization. Instead, think how your organization can deliver value to the corporation.”

For the consumer study on corporate responsibility, click here. For a separate study by the Committee Encouraging Corporate Philanthropy, click here.

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