Tech Firms Make Charitable Giving a Priority
Saturday, June 17, 2006
As Bill Gates takes a step back from Microsoft Corp. to set a new standard for social responsibility, other technology companies are aiming to find new types of corporate giving for the Internet age.
Yahoo Inc. yesterday announced a partnership with One.org, an organization that fights AIDS and poverty. Through a 6-month-old program called Yahoo for Good Scrum, the company allowed employees to take time off from their day jobs to revamp the One.org Web site. The program aims to take on five similar projects a year to apply technology to charitable causes.
Similarly, Hewlett Packard Co. runs a project called Digital Villages, where employees try to infuse technology into central city communities. International Business Machines Corp. runs a Transition to Teaching program that helps teachers become accredited in math and science.
Companies are experimenting with different types of donations. Intel Corp. supplied 100,000 computers to schools in low-income markets, and Google Inc. has donated $33 million in free ads to nonprofit organizations in 10 countries.
"Technology companies are waking up to the fact that they have to attract and maintain loyalty with their customers," said Carol Cone, who heads a Boston marketing consulting firm, Cone Inc., that helps develop corporate-giving programs. "Philanthropy allows a company to demonstrate its values in action and present a human face to its stakeholders."
It's a relatively new phenomenon, she said. Until five years ago, "the product spoke for itself," she said. "They were so focused on the products and services that giving back wasn't a priority."
Now, her firm gets several calls from technology companies looking to broaden their altruistic programs.
While many companies continue to donate large sums to various charities, simply writing a check to a worthy cause doesn't connect with the public.
That's why companies like Yahoo, IBM and Hewlett Packard have invested in programs that improve education in science, math and engineering, which helps improve their future workforce prospects.
Last year Google planned to invest in corporations with socially responsible agendas rather than give all donations to its charitable foundation, Google.org. Company founders Larry Page and Sergey Brin started the $90 million foundation last year to address global poverty, energy and the environment.
Curt Weeden, president of the Association for Corporate Contribution Professionals, said publicly held companies have an obligation to choose causes that are somewhat "self-serving."
"These are high-impact, branded approaches that are tending to be aimed exclusively at technological activities," he said. "With multiple shareholders, [a company] has to demonstrate that there is some rationale as to why it has selected that cause."
Gates, who began the Bill & Melinda Gates Foundation in 1994, has paved the way for other industry leaders who have amassed wealth from technological success, Weeden said.
Gordon Moore, founder of Intel Corp., started the $5.3-billion Gordon & Betty Moore Foundation that focuses on environmental conservation and science programs. And eBay Inc. founder Pierre Omidyar and his wife, Pamela, funneled $133.7 million to educational causes and his own organization, Omidyar Network.
Companies in all sectors are beginning to look at philanthropy through a global lens, partly in response to Gates's impact in health care around the world, said Judy Belk, senior vice president of Rockefeller Philanthropy Advisors.
"Every philanthropy is keeping an eye on what he's doing, not only because of the immense resources behind him but the thoughtfulness of what he's done," she said.
At Yahoo, several programs leverage its large online presence for charitable causes. After Hurricane Katrina last year, the company raised more than $40 million in 48 hours by letting users contribute online. Yahoo has also started a Cybergiving week each December to capitalize on year-end gifts.
The company has also started a foundation that gives up to $30,000 to nonprofit organizations in which employees are involved.
"We've tried to focus on ways we can uniquely make an impact on the world," said Meg Garlinghouse, director of Yahoo for Good, the company's community relations program. "What assets do we have that are more significant than our competitors?"