Part I: Is Social Consciousness Optional
As a nonprofit, do we get to pick and choose when we will be socially conscious and when we won’t? I never thought that being socially conscious was one of those concepts that was situational. Isn’t it like being pregnant: either you are or you aren’t? But, a recent conversation made me wonder if others see as I do. Is there a continuum of social responsibility that says we are more or less, depending upon the question being asked?
The recent conversation was about investment policies for those nonprofits savvy—and lucky–enough to have funds needing investing. (As you can gather, my assumption is that, of course, any nonprofit with funds invested anywhere—a CD, the stock market, mutual funds, etc.–has codified investment policies. Right?) I asked this individual who has managed portfolios for foundations, among other nonprofits, how did socially responsibility influence his investment decisions? To my surprise, he told me it didn’t. His interest, he said, wasn’t in being socially responsible with his investments but ensuring that there was as much money as possible to distribute through the foundation’s funding process to charitable organizations. If the average return from organizations on the Domini Index of socially responsible companies is 12% versus 14% for those funds that don’t make the grade, isn’t it better to get the 2% greater return so the foundations have more to donate?
But should we who work in the nonprofit sector, trying to make life better for everyone—from veterans and artists to the homeless and infirm—pay for our work with money made from companies whose products we don’t endorse? From companies who treat their personnel as we would never expect our clients or staff to be treated? Do we have an obligation to say we will make up the 2% difference by working more effectively and efficiently rather than make the money from companies who conflict with our mission and core values? Don’t we have a moral obligation to be as socially responsible with how we make our dollars as we are with how we spend them?
I know that there are many other scenarios I could raise where we as nonprofits face the question of just how socially responsible we will be. Will we recycle? Will we employ the ex-con or recovering drug addict? But I’m not going there right now. Right now I’m focused on this all important issue of social responsibility and the impact on our revenue.
These are some pretty heady questions. I’ve got another one for you – if massive companies like Apple use “green ingredients” to make their products “better for the environment,” are they doing it to be socially responsible, or is it all good PR in this environmentally-concerned world?
A little off topic, isn’t it? Sorry about that. Your blog just continues to make me think and wonder.
When I worked for a domestic violence program, the staff was conflicted as to whether to accept funding from The Playboy Foundation. Was a publication that objectifies women contributing to the climate that tolerates, if not encourages, the abuse of women? Ultimately, we never applied. And ultimately, our organization ran out of funding and closed. So who was right????
I am interested in the definition of socially responsible. Seems possible one person’s socially responsible is another’s evil. Sometimes it’s obvious (I would expect a land conservation org to make sure they weren’t investing in a development company), but would they also make sure that all the foundations they receive money from don’t have development investments?
And this doesn’t even touch on the origin of a lot of the money the foundations started with! Depending on how narowly we define social responsible, we might eliminate just about every funding source.
Laura’s response to Karen:
Karen, your point is absolutely right on: what is socially responsible in one situation or to one person is not going to be socially responsible to or in another. But this is exactly the discussion that a responsible board should be having–how does it want to define socially responsible for its organization? A lawyer colleague recently told me of getting a call from a client, an animal rescue organization, wanting to know if it would be okay to allow hunting on their property. My guess is this group didn’t have the socially responsible conversation. Whether an organization wants to be mindful or not of the sources of its money (and more), and just how far an organization wants to go is entirely up to it. Not having this conversation, though, is socially irresponsible.
Is it socially responsible for a food bank, for example, to pay its employees a salary that keeps them among the working poor, who would qualify to receive food assistance? But then we must consider that that same food bank is financially strapped and if it paid its employees more, wouldn’t be able to afford its regular food distribution. So are we sacrificing our staff well-being for a greater good?