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Strategic Environmental Philanthropy

Businesses are often perceived as environmentally destructive forces, but they can also be powerful models of change. An organization that addresses societal needs can at the same time advance business interests.

Strategic philanthropy emerged in the 1980s as a management practice to support social responsibility in organizations in the United States. Strategic philanthropy is defined by Dr. Linda Ferrell as “the synergistic use of organizational core competencies and resources to address key stakeholder’s interests and to achieve both organizational and social benefits.”

Through strategic environmental philanthropy, businesses can benefit the environment by increasing their efficiency and disseminating the green message. Strategic environmental philanthropy can be useful in distinguishing a business from competitors. The key is putting the economy to work for the environment.

Here are a few simple ways even small companies can help environmental causes while building their brand and bettering their bottom lines:

  • Offer products to environmental groups which they in turn sell to their members for a share of profits.
  • Provide coupons to environmental groups that earn a percentage of the profits.
  • Offer business premises for environmental fundraisers or receptions.

The key to value return is giving (discounted purchases, a percentage of sales, or gift certificates).

Strategic environmental philanthropy is more than a transparent effort to improve a company’s image. Businesses must strive to understand and meet all needs, including those of the environment. There are a host of adverse consequences to being guided by profit alone, such as public skepticism, distrust, and employee dissatisfaction.

Former Coca-Cola CEO, Roberto Goizueta noted, “By embracing a strategic approach to philanthropy, corporations fulfill their responsibility to their shareholders, and their commitment to the community.”

Businesses are increasingly seeing the value of environmental considerations, and philanthropy is increasingly being integrated within the corporate strategic plan. Many firms have discovered the performance benefits of philanthropy, including increased customer loyalty, enhanced company reputation, strengthened employee commitment, and productivity.

There can be no environmental leadership from the business community without profit. It is vital that we explore viable business strategies for reducing our adverse impact on the planet. Strategic environmental philanthropy does not preclude profits. It enhances them to the good of all and the environment.

Strategic environmental philanthropy improves businesses and the environment, while the unbridled pursuit of pure profit actually undermines the bottom line.

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Richard Matthews is a consultant, eco-entrepreneur, sustainable investor and writer. He is the owner of THE GREEN MARKET, one of the Web’s most comprehensive resources for information and tools on sustainability. He is also the author of numerous articles on sustainable positioning, green investing, enviro-politics and eco-economics.

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Comments

  1. You might be interested in the tale of an environmental philanthropist who lost US$35 million trying to do some good in the Caribbean. There is a lesson here somewhere and it relates to your point of putting the economy to work for the environment.

    That only works until the new government of the day changes the laws that had protected the sustainability of the project being funded. Read it and weep for all the wasted money:

    Barbados Government takes new steps to destroy foreigner’s US$35 million eco-tourism investment on South Coast – Part 1 in a series

    http://barbadosfreepress.wordpress.com/2010/01/14/barbados-government-takes-new-steps-to-destroy-foreigners-us35-million-eco-tourism-investment-on-south-coast-part-1-in-a-series/

  2. The story that needs to be told is that there is profit in sustainability. Too many people fear that protecting the planet will result in a profit pinch and job losses. It doesn’t have to be that way, as respecting the earth means reducing waste and maximizing efficiency, both of which are good for the bottom line.

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