Six months ago, our Group President and CEO, James Chalmers wrote a great piece on how we all have impact potential. This week, we thought we would build on the topic and discuss some of the different ways organizations can set themselves up to deliver greatest impact. How organizations use their capital has great impact on both the economy and community. Organizations are increasingly seeking investment opportunities that can both increase their bottom lines as well as benefit the communities in which they operate in. The following are a few examples of how various types of organizations are using business as a force for good.
Recently, there has been a new way for for-profit organizations to achieve impact and social change. Certified B Corporations are for-profit companies certified to meet rigorous standards of social and environmental performance, accountability, and transparency. Today, there is a growing community of more than 2,400 Certified B Corps which TACK10 is proud to be a part of, working together toward 1 unifying goal: to redefine success in business. Clothing manufacturer and B-Corp Patagonia is committed to reversing the steep decline in the overall environmental health of the planet. Patagonia is donates time, services and at least 1% of sales to hundreds of grassroots environmental groups all over the world who work to help reverse the tide. Their goal is to build the best product, cause no unnecessary harm and use business to inspire and implement solutions to the environmental crisis.
Non-profits, by definition exist to provide programs and services without turning a profit. The revenue non-profit organizations make are then reinvested into furthering their cause. Our client, Food Banks Canada, is the only national charitable organization that has made great strides in helping Canadians who are living with hunger. They do this by supporting a network of 10 Provincial Associations and more than 500 food banks, sharing food and funds and delivering programs and services. Food Banks Canada is also committed to finding ways to reduce and eliminate hunger by influencing policy through research, raising awareness, and advocacy.
The Global Impact Investing Network (GIIN) defines impact investments as “investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return.” The value of this sector has grown exponentially – according to a recent survey from GIIN there are currently $228 billion in assets under management. This is up from $114 billion in 2017. The rise of impact investing can largely be attributed to individuals wanting to be a part of the solution to problems that are affecting their communities. Impact investing has a wide variety of investors in many different types of organizations like corporations, banks, insurance funds and foundations. Individuals and private philanthropists are also players in this space. Nestle’s bottled water division Nestle Waters has recently made an impact investment into the Closed Loop Fund. An organization that is looking the increase the scale of recycling infrastructure. This investment allows Nestle Waters to create long-term impact for both the organization and society by tackling the issue of recovery of post-consumer used material.
Corporate philanthropy tends to have a more narrower, limited scope – it refers primarily to donations made to charitable and non-profit groups. This could be by the organization itself, its employees or both. According to Fortune, tech giant Google is among one of the most charitable companies in the Fortune 500. Google’s philanthropic arm Google.org is committed to supporting organizations that are developing bold approaches in solving social issues. Recent donations include $2.4 million to GiveDirectly, a non-profit that provides direct cash aid to the poor. Additionally, Google.org sent employees out to refugee routes in Europe to help in installing Wi-Fi, giving refugees access to connectivity and devices.
Social impact is evolving – as organizations realize to make an impact in the communities around them they do not have to choose just one way to do so. A blend of different methods can be employed to help organizations meet their mission. One thing is for sure, as social impact initiatives become the new norm – organizations are going to have to take stands and support positions in order to remain relevant.