Last week was big for Creating Shared Value in Sydney with the launch of the “State of Shared Value in Australia” report. A Friday morning breakfast starred IAG, Nestle, NAB and Social Ventures Australia launched the report in front of hundreds of shared value professionals. It was yet another indication that now is the time for shared value. Therefore, I have renamed the sustainability section of my website to include “shared value”.
There is an odd sense of elitism that the shared value movement has against corporate social responsibility. Last year I touched on this in “CSR or CSV? Either, whichever gets results”. There is even more so against corporate philanthropy. But corporate philanthropy is still relevant in today’s corporate environment. The last quarter has seen top multinational organisations, including leaders in sustainability, make significant philanthropic announcements. This article looks at a few recent examples of companies in the spirit of giving millions of dollars without expectation of commercial return.
The Big Bang Theory, 4 million US dollars for tertiary science scholarships
This first significant example of philanthropy comes from an unlikely source. It was reported in May that The Big Bang Theory cast and creators created a US $4 million scholarship for low-income science students. Twenty scholarships were announced for students of UCLA in science, maths, engineering and technology for the 2015-16 period. Following this, five further students will be supported each year in perpetuity. The motivation is giving back to the very community that the show is set in.
IKEA, 1 billion Euros towards the low carbon economy
IKEA announced in June it has pledged EUR 1 billion “to accelerate the transition to a low-carbon economy and to support the communities most at risk” for the next five years until 2020. This is divided into two components: a 600 million Euro fund for its own energy strategy, beyond 100% renewable towards total energy independence; and a 400 million Euro fund in the name of its foundation for supporting families and communities most impacted by climate change. IKEA’s push towards renewable energy is well documented, stemming from its firm belief that energy self-sufficiency is a smart long-term business decision. However, the IKEA Foundation component of the billion is very charitable. The foundation fund has a dual purpose: climate change resilience and renewable energy adoption for homes, schools and businesses in poor communities. Neither of which really meet the basic Creating Shared Value premise of business value hand-in-hand with the social or environmental value.
VF Corporation / The North Face, US $500,000 in NGO donations
In July, VF Corporation’s hiking brand The North Face gave $500,000 to 47 not-for-profit organisations in the United States. A massive payout to NGO’s sounds like philanthropy. And in its categorisation of the article, CSR certainly described it as such. But looking closer shows a clear alignment with business objectives. “The North Face Explore Fund use outdoor exploration as the catalyst for positive, personal or societal change, provide experiences that nurture an appreciation of the outdoors or encourage participants to try new outdoor activities that allow outdoor exploration and adventure.” Here, The North Face used philanthropy to market position itself as the go-to brand for socially conscious adventurers by brand associating with 47 NGO’s. Hence, it incorporated shared value into its philanthropic strategy.
A quick conclusion
I expect that the case of The North Face Explore Fund’s hybrid philanthropic-shared value program will become increasingly common as sustainability professionals drive to push the commercial viability of it as a function. But it is nice to see that old-school giving is still very much a popular thing.