NYC and Personal Agendas for the Public Good

New York. A great town that always gets me thinking. I was there these last few days for work, and had a bit of free time to spend wandering around the city. On this trip, my thoughts wandered to the public and private initiatives designed for the betterment of the city and its residents.

My flight on Saturday took me over Robert Moses beach - a well-known, free retreat for city residents seeking a break from the heat along a lovely stretch of sand. From the plane I could the vast parking lots, art deco bath houses and changing rooms, and train tracks that help deposit the throngs in the summer months. Robert Moses, the man, the legend, remains a controversial figure in New York City history, but can be credited with an extensive public parks network originally designed to serve the city's lower income neighborhoods. (Unfortunately, I missed a number of exhibits on the man and his legacies in NYC last year, reviewed in this New York Times article.)

I also strolled by the New York Public Library - a gorgeous beaux arts building that came to be as a result of the charitable donation of Samuel Tilden, a lawyer and former governor of the State of New York. Together with the resources of the Astor and Lenox libraries, already in existence (although not exactly 'free libraries'), the Public Library became the first of its kind in New York City.

Hmmm, ok, so this all makes for a good history lesson. But, what could a public park designed by a public servant, and a public library created by private wealth have in common with each other? And with corporate benevolence? Personal agendas for public good. In other words, both are really stories of a man with a plan. (I'm revealing my roots here - that's also the name of a GREAT movie about an old Vermont farmer running for office...but I digress...)

I'd love to see the day when social responsibility initiatives play such a primary role in corporate agendas. Perhaps, one day, CEOs will take over the reins of a company and define not just their fiscal and restructuring plans, but their goals for good as well.

A Corporation's Warm Glow

A few different things I've read recently have me wondering about the direct and indirect consequences of doing good. Just as people experience indirect benefits from benevolence, it turns out so too can corporations.

When it comes to the personal benefits of doing good, studies have actually shown that we almost universally display a positive emotional "high" after we've made a charitable contribution. As the New York Time shares in an article on "What Makes People Give", an economic theorist referred to this as the "warm glow" theory: "In the warm-glow view of philanthropy, people aren’t giving money merely to save the whales; they’re also giving money to feel the glow that comes with being the kind of person who’s helping to save the whales." (My mother likes to call it a Helper's High. Either way, you get the idea.) Daniel Goleman points out that the emotional halo works in reverse; If I do something bad that makes me feel like a lousy person, or get yelled at by someone, I carry the icky emotional residue of that encounter around with me.

So, there's an indirect, latent effect of charitable giving. For people, it's an emotional high.

It comes as no surprise that a corporation gets to bask in it's own "warm glow", of sorts. And this positive halo effect is visible in both financial and human factors. Take 'green' corporations as an example: In theory, they sell more product ($$$) and directly benefit the environment. But, one piece of research points out that it's the human factors - the indirect benefits - that are also incredibly powerful. This study conducted by the UK-based researchers Ipsos MORI showcases that people feel even more strongly about working for a "green" company than they do about buying green products. In fact, there's a significant discrepancy between the two.

















(This comes from people saying “agree” to the questions “I would prefer to work for a company that has a good reputation for environmental responsibility” and “I would be more likely to purchase products of services from a company with a good reputation for environmental responsibility” Study: “Corporate Environmental Behavior and the Impact on Brand Values”, Tangberg and Ipsos MORI survey, October 2007; n = 16,823)

This begs the question - what other indirect benefits are there of being green? I could envision a study measuring whether people are willing to take a paycut to work for a 'greener' company. And what about looking at the reverse; Do we need a pay increase in order to work for a company that we find morally repugnant or environmentally damaging? And just how much will we sell out for?

What it is

In 1970, Milton Friedman published a piece in the New York Times Magazine entitled "The Social Responsibility of Business Is to Increase Its Profits". He argued vociferously that the exclusive role of the modern corporation was to make money. He believed that businessmen arguing in favor of internalizing and pursuing a social mission were "preach­ing pure and unadulterated socialism". He quotes himself, ending with this excerpt from his book: "There is one and only one social responsibility of business–to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud." To prioritize social responsibility ahead of profits was to lose sight of the very reason corporations came to be.

But, I want to understand whether today the two - making money and doing good - are perhaps inextricably linked? And is that okay? Do we accept when the brands we love do good because they benefit from it, or do we hope they'll do good simply because its the "right" thing? When do they do the latter, and when the former? The modern consumer is increasingly anthropomorphizing brands - projecting onto them human characteristics and emotions. Has that contributed to a sense that companies - like people - should do what is "right" rather than acting only in their own self-interest? And what is the prevailing opinion around what makes for "right"? In Friedman's day, it included conceding to labor union demands. Today, it's ethical labor and environmental practices, cause marketing, pro bono work, community outreach, sustainable development, "accessibility" and a host of other terms already or yet to be coined that I haven't encountered yet.

This blog will log my circuitous musings on all of those topics. It's one woman's study of corporate benevolence.