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Corporate Philanthropy Comes Into Alignment

When Cisco began its Networking Academy in 1997, corporate philanthropy was in decline. In response to the twin pressures of returning more value to shareholders and doing more good in the world, many companies had shifted spending from philanthropy itself to publicizing philanthropy, with marketing taking precedence over social and environmental impact.

Cisco’s approach was a natural outgrowth of its business: after donating networking equipment to local schools, the company realized the equipment wasn’t being used because no one knew how to manage it. But instead of simply installing and managing the networks themselves, Cisco engineers volunteered to train staff to build and maintain their own networks. When students sat in on these sessions, they quickly learned networking skills as well. Within a year, the program covered 64 institutions in 7 states. Today, Cisco reports that it has impacted the lives of 12.7 million students in 180 countries.

While the longevity and reach of Cisco’s program is commendable on its own merits, the program’s alignment with Cisco’s business needs may be the biggest reason for its success. At the time Cisco began its Networking Academy, a shortage of tech workers was limiting the company’s growth. By donating supplies and training, Cisco not only enabled students of all backgrounds to advance into well-paying careers: it created what the company itself still refers to as a “pipeline of technical talent,” ready to accelerate the adoption of its products around the globe. Today, partnerships help Cisco amplify this effort, with partners as varied as the State of Michigan, Italy’s Ministry of Education, the Trust for the Americas in Latin America, the UN Women program, and US AID (to name a few) bringing those most in need of job training into Cisco’s global talent pipeline.

To be sure, the allure of philanthropy as marketing has not gone away. But more and more companies now follow a model similar to Cisco’s. Take Colgate, whose “Bright Smiles, Bright Futures” program, targeting underserved children around the world, has reached more than a billion children in over 80 countries, according to Colgate. The premise is simple: Colgate connects communities with oral health education, free dental screenings and treatment referrals. In return for the necessary work of promoting better oral hygiene among underserved communities, the company grows its global customer base and brand awareness. Like Cisco, Colgate leverages partnerships with governments, NGOs and others to expand the program’s reach even further.

Even absent namesake programs, other companies have embraced the trend. General Mills’ long-running “Box Tops for Education” program is not the company’s only strategically-aligned philanthropic effort; the company has also recovered and freely redistributed 2.3 billion pounds of surplus food since 2014, simultaneously reducing food waste and food insecurity while putting its products in the homes of more potential future customers. Partnerships again play a role; for General Mills these including Feeding America, The Global FoodBanking Network, the Nobel Peace Prize-winning World Food Programme, and more. Life sciences and pharmaceutical companies such as Agilent and Regeneron also focus giving on education and professional development related to their missions, with examples including the Agilent Technologies Foundation’s focus on “education and development in life sciences,” and Regeneron’s $100 million commitment to support the Society for Science & the Public’s 75-year-old “Science Talent Search” competition. The latter effort is so well aligned with Regeneron’s business that the company’s CEO and chief science officer are both products of the program.

In cases where this alignment between philanthropic and business objectives has been so thoroughly achieved, it may be tempting to dismiss the philanthropic efforts as merely self-serving. We would argue, instead, that these kind of efforts are critical to making corporate responsibility truly impactful. Well-aligned programs are more likely to be better-funded, long-running, and effective, particularly given the key role of partnerships with organizations that understand the needs of local communities. The environmental and social efforts of these companies also do not end with such programs. Cisco, for example, has set and progressed quickly toward ambitious Science-Based Targets for reducing greenhouse gas emissions, notably including those from its suppliers. The company is transparent about its workforce diversity and pay parity, with a 2020 commitment to hire 75% more Black executives as one example of its efforts at improvement. In support of its goals to reduce virgin plastic use 20% by 2025, last year the company created its first closed-loop plastic product (its most popular IP phone), and became a founding member of the Circular Electronics Partnership, with the goal of a circular electronics industry by 2020.

Deployed in tandem with a range of environmental and social efforts such as these, well-aligned corporate philanthropy can help deliver on the promise of the triple bottom line, providing forward-looking companies an opportunity to focus simultaneously on people, planet and profit. This may be just a start, but for us it is a critical proof-of-concept for a more just system for all.