Giving Compass' Take:
- Michael Moody discusses how business practices like corporate responsibility and an appeal to social sensibility have created a gray area between profit and nonprofit sectors.
- How do you approach business and philanthropy? Are these things compatible in your view?
- Read more about the way business is implementing charitable policy.
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The creation of the Chan Zuckerberg Initiative (CZI) in late 2015 as a charitable LLC — a for-profit entity being used for nonprofit, philanthropic purposes — was a signal moment in this trend. Other billionaires have now followed suit, including Laurene Powell Jobs, the widow of Apple founder Steve Jobs, and John and Laura Arnold, who recently converted their family foundation to an LLC, Arnold Ventures. Two other well-known examples of this trend — the rise of socially responsible B Corps and increased popularity of impact investing — have also continued to spread, infusing both the consumer and investment landscapes with concerns about social responsibility while complicating further our answer to what is philanthropy and what is business.
More broadly, a commitment to charitable giving and social benefit is increasingly seen as a necessary and profitable aspect of any business. CSR (corporate social responsibility) is more widespread than ever, dominating MBA curricula and business publications alike (Janes & Rau, 2020). AmazonSmile makes combining charity and shopping easy. And even multi-trillion-dollar investment firm BlackRock now requires companies in their portfolio to demonstrate their social contributions (Ross Sorkin, 2018). An article in the Harvard Business Review even predicted, “We are entering the age of corporate social justice” (Zheng, 2020). This is certainly a far cry from 1983, when American Express first introduced the idea we know as cause-related marketing — contributing a small amount to charity for each purchase with the card. At the time, this and other similar efforts were met with strong skepticism and concerns that they would turn charity into just another marketing gimmick (Gottlieb, 1986). Today, the practice is widespread and normalized, even expected.
Read the full article about the fine line of philanthropy by Michael Moody at Johnson Center for Philanthropy.