Philantrophy is hip today.
So many individuals and companies do this, for different reasons.
What is philantrophy, anyway?
In my noob words – philantrophy is an act of donating resources – money, time, and goods – for a charitable cause, usually carried out as a campaign of an organisation.
Philantrophists (people who do philantrophy) are usually having business-influenced causes. So, many promote philantrophy as a good business practice.
Giving is good – why philantrophy stirs pros and cons?
Although the concept, in itself, is good, philantrophy is often considered unethical.
Why? Like I mentioned above, companies do philantrophy as one of their campaign. And, in my opinion, charities as business agendas are like people hoping something in return for their good deeds.
My argument – if it is solely for a good cause, why bother creating a press release campaign about it?
People would argue – as long as it is doing something useful for the society, why bother whether it is on spotlight or not?
It is a gray area, really.
Why I wrote this post, anyway?
I love seeing companies that, in their silence, contributing their resources for a good cause. In my opinion, entrepreneurs and business owners have to be more ethical approach. You can monetise your business as much as you want, but leave the charity part alone.
I wrote this post in support to those entrepreneurs that do charity in silence, without the buzz and press releases. I see them as ethical entrepreneurs and the real life-changing people.
If you want to really help the world, or on a more realistic scope – your community, do a true philantrophy with no intention of getting anything in return.
One last comment – white label your charity, please :)
White label philantrophy – now that’s a good tag!
Ivan Widjaya
On white label philantrophy
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what does it mean to “white label?”
Hi nina,
White label means removing any affiliation, endorsement or branding.
In philantrophy, what I meant by “white label philanthropy” is philanthropy that is done without any affiliation, i.e. your company name/brand name. Why? Because many philanthropy activities are done with a “stealth” purpose – raising a business brand’s profile in the eyes of the public.
Nothing wrong with that, but in my opinion, it’s somewhat unethical to use non-profit events with a purpose to promote your brand name (sponsorship is okay, but doing good to raise your status/reputation with the public? It doesn’t feel right…)
I hope this explains a bit :)
Thanks!
I’m glad at least someone realizes this. It shouldn’t have been so hard to understand this.
Thanks.
Janice,
Yes – it feels “artificial”, too…
Ivan,
What if each of the companies were recognised by a universal brand, kind of like the Australian Made logo? This way they wouldn’t be pushing a specific event or charity for their own recognition. Their involvement would be recognised for all campaigns and they would have an economic reward for their support (ROI), however the program/campaign would not be influenced in order to increase their return. Would this then change the questionable ethical feel of their involvement and recognition? This concept was discussed in the movie Handcock (it was part of the subplot). I am interested in your view on this.
Cheers
Brett
Hi Brett,
Thanks for your insights – It’s a difficult issue, but IMO, what the Australian Made does is sponsorship, rather than philanthropy. Charities do need sponsors to fund their activities, and the sponsors do naturally have ROI calculation in mind.
“The program/campaign would not be influenced in order to increase their return” – This what separates the ethical to the unethical philanthropy :)
Cheers!
hi, i just bumped unto this blog site and was in search for a subtopic for our economic class research. i think noobpreneur is misleading the public when he over-estimated philantrophy. philantrophy is giving. silly is the byword for not recognizing the act itself. hope this view wasnt gained through influence from scrupulous individuals in his circle.
“a child who grew up with charity, learns nobility in the act of giving, so shall he replicates it and so he shall receiveth–givers gain.”
Hi,
Thanks for your insight, but I’m have no intention to over-estimate philantrophy. I suggest you to re-read the blog post more thoroughly…
Yes, philanthropy is giving. But this article’s context is philanthropy IN business, not in general term of giving. In business, this simple act of nobility is often abused, with “What can I get from it?” mindset over “What can I do to give back?”
Oh is that so. i’m sorry, i just didnt mean to be rude. i can agree, business nowadays are full of tricks and scams. you gave a good point on that. back to school now–david of ausie.
No, no – Don’t bother. Just a simple clarification, that’s all :) Anyhow, thanks again for your insight.
What do companies do when there’s nothing more to give? I find this question as puzzling as philantrophy.
Melo,
Hmm… A philosophical question… To tell you the truth, it’s hard to answer – even harder to answer than the issue of philanthropy itself. IMO, companies always can give – What they could do is actually to give without asking anything in return – Not in the slightest sense.
I have gotten ideas that part of being philantrophic is the element of being unknown. Why identify oneself if he doesnt need anything at all in return? Or why did famous philantrophists reveal themselves in modern times in contrast? Needless to say therefore, anybody can give without them knowing who that someboby is. No tell tale signs whatsoever. Perfect, this is all the more interesting to me!
Melo,
Agreed – that’s what has been missing, especially in the business world. Alas, many businesses not taken into account any subtleties, printing their business names as sponsors as big as they could. Of course, business want to get something in return of a certain amount of investment – But philanthropy is NOT a business investment.
Hmmmmmm………I’m no fully convinced yet when you say: “NOT A BUSINESS INVESTMENT”?
When one gains from certain generosity, the other benefits from the act; and by so doing it can make other people’s lives happier.
Lets set a utopic scenario:
If “A”, a philantrophist of a certain city decides to give substantial money in BILLIONS without those people knowing it. Then to make the story short and simple, Mr. “A” specifically instructed his men to make them appear as if the money is for loans business and purposes (secured), specifically for starters and small to medium businesses, charges them nil even for the money borrowed if and only if they complete payment.
Chances are by these example, can it boost the city’s income per capita? Can this be qualified as INVESTMENT, or least we say FRESH CAPITAL by the very term and meaning of it, translated as reward?
Melo,
Ah, sorry for being ambiguous – What I meant by “not a business investment” is that philanthropy should not be considered as a business investment strategy – Many businesses do philanthropies with an expectation that what they give will return them in term of money and brand awareness.
I agree with you – IMO, angel investors are, in essence, philanthropists – They do invest in business and expect a healthy growth of the business, often with no interest in how much money the business they invest in will yield them.
“Can it boost the city’s income per capita” – Yes. I like what Kiva is doing – Letting members to lend money to micropreneurs, mainly on developing countries, with the option to donate the money altogether. All can be done anonymously – A true philanthropic opportuniy, just like what you mentioned :)
Dear Ivan,
I’m curious, If any of those Companies you were referring to who look for returns
(whatever they might be) offered to give you and/or your Company $10 million, would you accept it or return it? Just curious!!!
Hugh
Hugh,
I won’t lie to you – I’ll take it, as long as it’s legitimate :) Of course, if it’s a bribe money or money laundering I won’t take it by any means – LOL
Being ethical philanthropist is for each and every individual or business endeavour – It’s not something to point our fingers to. For instance, suppose I own a non-profit organisation; If you gave me $10 millions in exchange for a branding opportunity on one of our campaigns, I’ll gladly accept it! It will help my non-profit organisation’s mission a lot! The issues whether it’s ethical or not is for you (and the public) to decide.
Cheers!
“Like I mentioned above, companies do philantrophy as one of their campaign. And, in my opinion, charities as business agendas are like people hoping something in return for their good deeds.
My argument – if it is solely for a good cause, why bother creating a press release campaign about it?
People would argue – as long as it is doing something useful for the society, why bother whether it is on spotlight or not?
It is a gray area, really.”
–HHMM… MAYBE BECAUSE IT IS ONE OF THE MOST EFFECTIVE WAY TO UPLIFT A COMPANY’S REPUTATION. PHILANTROPHY IS CSR. CSR IS ONE OF THE GOOD PR STRATEGIES PERFORMED BY THE PR PRACTITIONERS AND BUSINESSMEN NOWADAYS TO HELP MAINTAIN MUTUAL RELATIONSHIP AND UNDERSTANDING BETWEEN THE ORGANIZATION AND THE OUTSIDE PUBLIC. SINCE THIS IS A MANAGEMENT FUNCTION, IT CAN APPARENTLY HELP BUILD THE COMPANY’S CORPORATE IMAGE AND GOODILL.
momo,
That could be it – philanthropy is so effective in enhancing a business reputation and brand image that it is packaged (or repackaged?) in the form of CSR. CSR done right can make a big difference to the society, regardless of what intentions businesses have.
I really enjoyed your article. I am working on a lecture series, and I would like to use some of the information in this webpost in it. Is this allowed? If so, I may also use some of the information on my Internet Marketing blog, but I will definitely leave a source link to your web article if I use any of your material. Anyway, I look forward to more of your great information and shoot me an email if I can help you at all.
Randy,
Sure – be my guest :)
The alternative to getting publicity from philanthropy is traditional marketing. That is, just spending the money that could be spent on philanthropy on advertising to get the same publicity.
Lets say majority of a company’s marketing returns comes as a publicity gained from giving money to a good cause. Now this generates more money for the company and it can then again give more money to this cause. And then the cycle repeats. It’s a win-win situation for the company, the charity, and the cause itself.
Whereas if the company would be using it’s money on traditional marketing channels the only one to gain would be the company itself.
For this reason there is absolutely nothing wrong with companies gaining something from philanthropy. In fact it’s good, because it encourages companies to give more money when they otherwise wouldn’t or couldn’t. Companies have a limited amount of funds to spend and if they don’t get return from philanthropy they are obviously going to do less of it. Otherwise they would go bankrupt.
Philanthropy is the socially responsible way a company can market itself. Everyone benefits from it.
Except of course those who think that it’s wrong to get any benefit from philanthropy and would just rather have big bad companies spend all their money on traditional advertising. No matter it hurts the charities and causes too – after all one’s personal ‘ethics’ is the most important thing and not things like curing diseases and feeding children in developing countries. Right…right? Maybe not.
The reason I’m so opposed to articles like this is that they spread the word that companies who do philanthropy and gain publicity are ‘evil’ – in fact even more evil than companies that don’t do any philanthropy at all. Which, if spread widely enough, can have only one outcome: companies start doing less philanthropy and go back to traditional marketing. In which case the only ones who really suffer are the charities and the people they try to help. Not the companies, they can just turn to other less socially responsible marketing methods.
Jay,
Many thanks for your great insight! I agree that philanthropy is one of the better, social responsible ways for a company to market itself.
Through this article, I didn’t say that philanthropy while gaining publicity is evil… Of course, charities need any help they can get and entrepreneurs should respond accordingly. What I encourage is for businesses to do philantrophy activities the right way – that’s all… If putting banner ads and marketing messages are acceptable for both participating businesses and charities – than it’s nothing to complain about… What I don’t like to see is for businesses to push unethical “philanthropic” activities knowing that charities are having lower “bidding position” in the partnership agreement. Charities should be selective in choosing their partners – it’s only common-sense business practice, I suppose…
Regarding your disagreement toward this article is nothing new… This article has always been misunderstood for years :)
Again, many thanks for your insight!
Hi
I like what you’re getting at, and I totally agree that most companies doing philantropy, but I think to discourage giving simply because it’s generating “buzz” or business is not a good angle to take.
First of all, I would much rather see a company donate money to a cause instead of their own pockets, no matter how much “buzz” it generates.
Second of all, while the notion of being anonymous in your giving is amazing, there is much value in the buzz generated by these companies. It gets out a message that giving is something worth doing, no matter what the reason is, and I think that’s better than a message of not giving at all.
Lastly, I love knowing what companies have donated to what causes.
Tabby Cat,
Thanks for the insight. It seems that my 3-year-old blog post is often misunderstood. But yes, you are right – it’s far, far much better to get company to support a cause in exchange for buzz instead of not giving at all.
Reading the comments on this blog post, I conclude that one of the fundamentals of giving – anonymous giving – is not really applicable in commerce world. It seems that in business, giving will always mean getting something in return.
One question: Is the source of fund will make a difference at all? I mean, for example, if a money laundering or any other organisation gives to charity, is it ethical to accept the fund?