Back to school: Everything you need to know about ... Short-term CSR partnerships
The rise of corporate social responsibility (CSR) has put pressure on companies to show what they are doing to fulfil their obligations. In light of this, many businesses want to assist humanitarian charities in the aftermath of major disasters, such as a hurricane, earthquake or famine. Some companies contribute to such causes through a single long-term partnership with a non-governmental organisation (NGO), while most prefer the flexibility of 'quick-fix' efforts that react to immediate demand. But what do companies with limited experience of disaster relief need to know in order to make these short-term partnerships work - for both parties?
INSEAD business school recently conducted a detailed study of 25 humanitarian organisations. The field managers surveyed ranked cash as the most helpful type of contribution from business. Money gives humanitarians the liquidity and flexibility that they need to respond quickly to the requirements on the ground. And often the value of cash is greater than the same value of goods. For example, a European company offered to provide nylon tents, at cost, for use in Pakistan. The cost price of one of those tents, if it had been sent as cash, would have bought a house in the same area.
The advantage of cash from the corporate point of view is that it makes it easy to track the cost. The return on investment can also be more evident: a fundraising activity organised by employees (and inspired by a corporate promise to match the money raised) can work more effectively than many so-called team-building activities. The downside is that handing over cash requires a certain amount of due diligence on the company's part. It needs to be sure that the chosen agency has both the capability (a track record and local knowledge) and the accountability (a history of providing reliable data about how it manages its funds).
Despite the strong case for cash, there are some good examples of alternative contributions. For example, Ericsson provided satellite and heavy-duty waterproof phones for relief workers in south-east Asia after the tsunami in 2004, while Danone had donated two million bottles of mineral water to the region by February 2005.
