Philanthropy in Action: Reflecting on the Impact of Corporate Donations
The actions that businesses take to improve the communities they are a part of can have both advantages and disadvantages. While philanthropy might seem great on paper, the implementation roadblocks require us to measure where the funds are going and how they are being used to determine whether CSR is truly beneficial for society or not.
One of the key problems with corporate donations can be that it’s hard to identify which issues are essential. For example, especially when it comes to environmental impact, there are no specific guidelines that spell out how to identify the right environmental issues. More importantly, a company that is responsible for furthering climate change through its greenhouse gas emissions can get away with its environmentally harmful practices by donating to wildlife conservation efforts. CSR would benefit a lot by including within its framework the negative consequences of a company's actions rather than just focusing on overall monetary donations. Another problem with corporate donations is that they respond only to certain stakeholders. Therefore, popular consumer bases usually determine what kind of social and political causes companies give money to. If something isn’t on the news and won’t help bolster the company image, it can be easily ignored.
There exists a huge gap between the values of a company and its business processes. Most companies tend to carry out CSR activities without actively integrating the values of compassion, empathy and community development in their business models. This also results in a lack of focus on CSR-related activities. It usually involves merely making donations without adequate follow-ups on where the money went and how it was utilized. The quantitative aspects of corporate donations can be used to cover up the qualitative impacts.
What needs to be improved is operational effectiveness through an integration of economic responsibility as part of the company’s internal systems. For example, rather than seeing sustainability initiatives as merely programs that require donations, a more integrative approach would start from the company, reducing waste across the supply chain to lower production costs. This would not only benefit the organization but would ensure that the company is in alignment with the values it’s presenting to the public. Business assessment should automatically account for the social and cultural issues that the corporate donations seek to address. The company’s performance should be measured on the basis of not just profits but its ability to meet appropriate social and environmental results. For example, India’s Unilever employs single women in remote villages to sell its products, providing them with sustainable and long-term employment opportunities, rather than simply helping them through welfare schemes.
Sources:
https://15writers.com/sample-essays/the-impact-of-corporate-social-responsibility-csr-on-organisations-and-their-stakeholders/
https://www.hul.co.in/planet-and-society/case-studies/enhancing-livelihoods-through-project-shakti/
