Wednesday, June 4, 2014

Creative Corporate Social Responsibility

As I've previously noted, non-profits have a set of structural issues that stack the deck against them delivering services efficiently and effectively. Not mentioned was the fact that many big nonprofits provide services by deploying small armies of volunteers from various big companies engaging in corporate social responsibility (CSR).

The New York Times recently had an interesting article about Toyota's CSR relationship with the Food Bank Of New York City, one of the largest free-food distribution organizations in the US. Instead of writing checks or sending unskilled employee volunteers, Toyota leveraged its efficient-business-process expertise to help make Food Bank better.

I tend to think that donating cash directly to charity organizations (or better yet, people themselves) is a much more effective way of making people's lives better compared to volunteering or direct service. The cost incurred by training, overseeing, and in some cases feeding new volunteers every day is too high, and biases organizations towards devoting resources into activities that can accept and use human volunteers. Charity organizations would be better served by receiving discretionary funds and then deciding--freely--what to use them for. Maybe it means the soup kitchen hires some servers (tasks previously done by volunteers), or maybe it means buying a better machine. Or maybe it means offering a high salary to steal away some lowly-but-valuable consultant to come run things. Who knows!

But clearly scrapping a volunteer program in exchange for a marginal increase in funding (most big companies that provide volunteers also provide institutional funding) would deprive companies of the branding component of CSR. And here's where Toyota's program is such a brilliant CSR coup. They managed to ditch the volunteering gig, which is relatively ineffective, while retaining--even enhancing--the branding and reputational benefits of their relationship with the Food Bank.

Now possibly this is just due to the novelty--if every business copies Toyota I'm guessing the New York Times articles will dry up. But in a broader way Toyota's branding success here shows that trying out innovative alternatives to boring-and-ineffective volunteer programs can pay off big time.

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