Felix Salmon posted an interesting commentary yesterday on Condé Nast's Portfolio.com website. Addressing a session from this week's World Business Forum in New York that featured microcredit creator and Nobel Peace Prize winner Muhammad Yunus, Salmon's piece, titled "Philanthropy vs Profit," concludes that
for-profit philanthropies have very little in the way of a track record, and the track record they do have is not particularly good. Maybe that will change, in the future. But for the time being, I'd keep the idea of for-profit philanthropy in the "not proven" category.
If there's a business leader who could change Salmon's mind, I think it would be Trish Karter, the CEO and Cofounder of Boston-based Dancing Deer Baking Company, and one of the keynote speakers at our upcoming Top Small Workplaces Conference here in Chicago.
Trish has made a name for herself more for employee participation in a tough, inner city environment and helping Massachusetts' homeless population find jobs and homes through the company's Sweet Home product line than merely running a successful business, which she's done since she and her partners founded Dancing Deer in 1994.
As Trish told us in an interview we did with her in late 2006, the year 2000 was a pivotal one for Dancing Deer when it came to marrying philanthropy and profit. It was then, after she bought out her partners and became CEO and majority stockholder, that she began to think seriously about doing much more than simply creating wealth for employee-owners and other stockholders.
The Sweet Home product line, established in 2002, emerged from this brainstorming. It gives 35% of the retail price of each order to homeless families in the state, and it has made a real impact. In 2005, for instance, Dancing Deer donated $30,000 to help three women with children achieve financial independence and a career path.
So how do businesses get started on a course to both give back and turn a profit? Trish told us, in answer to a question that was held from our 2006 interview due to length, that business leaders must identify a cause that "resonates with the definition of who you are and what you want to accomplish." She also said it's important to show a measurable gain at the end of the day, whether it be in terms of branding, increased employee morale, better perceived social responsibility by customers and clients, or raw revenue gains.
Obviously, your employee engagement best practices will help tremendously in both of these areas. Think of what a great team building exercise this endeavor would be!
What are your thoughts on philanthropy vs. profit? Do you think it's one or the other, or do you think businesses can achieve both with the right planning and execution?
