Unproven claims for philanthropy

Leaders must constantly monitor stakeholder expectations. This is no easy task: most large companies face a constant barrage of shifting and often conflicting demands from shareholders, customers, suppliers, investors, owners and regulators.

by Marc Benioff, Salesforce.com

One of the biggest questions CEOs and chairs currently face is: 'Do our stakeholders actually care whether the company operates in an ethical manner or not?' Opinion is sharply divided.

Advocates of corporate social responsibility argue that as consumers and investors become more socially aware, companies must demonstrate their ethical credentials or face losing customers. Sceptics say that despite the heat generated by all the talk of a new age of CSR, little has actually changed and that sensible companies will ignore the hype and continue to focus on the financial bottom line.

As its title indicates, The Business of Changing the World, a new book from salesforce.com, sits firmly in the former group. The book comprises 18 essays from leaders of major companies, each explaining their own firm's approach to CSR and philanthropy.

From the very beginning it is clear that its authors regard ethical practice as a necessity and not a choice. The second paragraph of the foreword attests: "It is clear to a leading set of CEOs that a new stakeholder demand has surfaced and is here to stay: companies must generously and consistently support the communities in which they operate."

The essays that follow enthusiastically endorse this viewpoint. Written by well-known business leaders including GlaxoSmithKline's CEO Jean-Pierre Garnier, Intel chair Craig Barrett, Levi-Strauss CEO Phil Marineau and Starbucks CEO Jim Donald, all serve to support the view that philanthropy is not merely good for the conscience, but good for business. And as an insight into how different companies are attempting to introduce philanthropy into their day-to-day practices, the book serves its purpose well.

But it is limited by its scope. The underlying assumption - that philanthropy is not a choice, but a necessity - is never tested or backed-up by solid evidence. Neither does the book seriously attempt to measure the claims made by companies for their philanthropic practices against the reality.

This is an omission: many people believe that CSR as practiced by a lot of companies is weak to the point of being meaningless. The fact that all the essays in this book are written by company CEOs and chairs means that we are presented with the opposite view: that of CSR as a consensus-based activity that achieves wonderful results in almost every case.

Which ultimately doesn't ring true. Opinions on CSR, philanthropy, ethical practice - whatever you want to call it - vary widely. The debate hasn't been won yet. This book offers a warm and handsome endorsement of the view that corporate philanthropy is the inevitable result of a more socially conscious world. But at times it is rather too warm and handsome. A little more honest debate would have been welcome.

The Business of Changing the World
Edited by Marc Benioff, chair and CEO of salesforce.com

Review by: Nick Loney

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