Ways companies can be philanthropic without giving a dime

Written by: Janay Richmond

Date: January 18, 2018

Too many corporate philanthropies and corporate social responsibility (CSR) initiatives are restricted in their ability to produce substantive change. And, corporations’ relentless pursuit of business success, and the consequential harm to people and places that resulted, was long considered the price of living in a capitalistic society. 

But today’s consumers have shifted expectations. According to Nielson, 66 percent of consumers are willing to spend more on sustainable brands. That number is even higher for millennials who also overwhelmingly prefer companies make public statements about their beliefs.   

As consumers become more loyal to conscious brands, more businesses are concerning themselves with the triple bottom line. Are these sincere efforts or merely good PR window dressings intended to increase profits?

Instead of exploring the full organization’s potential for constructive societal influence, corporations tend to look at their corporate philanthropy and CSR departments as “do good” arms of the larger body: The corporation continues to create messes in the lives of average Americans through practices like wage stagnation, the pursuit of aggressive penalties and leaning on corporate welfare, while the “do good” arms write checks for the brooms we in the nonprofit sector can use to clean the messes up.

I’ve long believed that there must be a better way for companies, beginning with those whose corporate giving arms are staples in our social justice giving community, to better align their efforts in order to be profitable and strong American businesses that also help support cities and citizens.

Thankfully, it looks like there is a case study in Newark, New Jersey, where Audible, the Amazon subsidy created 22 years ago by Don Katz, is transforming the community.

Audible, which has grown to become the largest producer and seller of audiobooks, saw its move from suburban Wayne, New Jersey, in 2007 as an opportunity to “impact a community in need at its core” and bring “economic vitality” to a dwindling city. Audible offered a housing lottery for 20 employees to support downtown redevelopment, a program that has now expanded to a $250 monthly subsidy for employees who want to relocate to the city.

In addition to bringing in new players to spur the local economy, they are inviting the people and businesses that have long called Newark home into this reimagining. The company offers prepaid debit cards for employees to frequent the city’s restaurants and uses locally sourced food in their office cafeteria each day. 

Audible also hires locally. One of the first steps Katz took after the move to Newark was a commitment to only hiring Newark kids for paid internships, a program that has grown into mentorships, college scholarships and partnerships with community schools — even communicating with educators on issues they’ve noticed in students like vocabulary gaps and struggles in college. (However, I recommend that Audible read Charter School Leaders are Complicit with Segregation, and It’s Hurting their Movement by Andre Perry.)

Audible can also boast that almost half of their entry level customer service positions are held by Newark residents and their recruitment team is steadily working to identify home-grown talent for openings at all levels of the company.

To further insulate Newark’s burgeoning economic success, Audible is working to position more employers of their size throughout the city while simultaneously tapping into the city’s 40,000 college students, a majority of which are a combination of immigrant backgrounds and first-generation students.

The Newark Venture Partners Fund was created to support budding companies and entrepreneurs and is currently housing 26 companies and 70 founders on the seventh floor of the Audible office space. The Audible staff provide master classes for this up-and-coming talent and have the start-ups measuring their impact on Newark in areas such as job growth, taxable revenue and foot traffic, in addition to standard business metrics.

This investment in Newark, one that wasn’t inspired by tax-breaks and subsidies, and one that people warned would cause Audible to lose 25 percent of its employees, has instead helped unemployment and crime reach historic lows while the company enjoys a 40 percent growth in their memberships each year. Katz calls this form of philanthropy “Activating Caring,” which puts the good of the people at the forefront and not as an afterthought to remedy a company’s daily missteps.  

Audible has decided to wholeheartedly commit itself to doing good while others have merely positioned their philanthropic efforts to lessen the blow of the corporation’s harm. 

This post is not a statement against traditional philanthropic giving. Money is needed, and corporations should continue doing the great work of identifying and financially supporting the nonprofits that are working to advocate and organize for change. But we see their full selves daily doing things like holding poverty simulators and other efforts intended to end homelessness while being a cause of poverty themselves. 

In order to actualize what their “do good” arms are working towards, companies must pull together a holistic approach to demonstrate that they, like Don Katz and Audible, are unequivocally committed to seeing people and places thrive.

Janay Richmond is NCRP’s manager of nonprofit membership and engagement. She earned a master of business administration degree from Saint Xavier University. Follow @JanayRichmond1 and @NCRP on Twitter.