In pushing the sustainability cause, some non-profit groups are becoming more intimately involved with the private sector
For an entire week during March, images of the Amazon rainforest beamed into the living rooms of Sky subscribers across the UK. Model Lily Cole was called in to provide some glamour, but South America’s magical biome did a good job of speaking for itself.
Behind the lustrous images, there was a simple but serious message: trees need to be worth more standing up than cut down. And so into an enviro-light version of Green Economics.
The programme wasn’t the sudden brainwave of some young creative within Sky. Rather it emerged as the result of a long-running, strategic partnership between the UK satellite television operator and conservation charity WWF.
The alliance, which dates back to October 2009, has two stated goals. Neither is modest. First, Sky wants to help preserve three million hectares of rainforest, saving one billion trees in the process. Second, it is committed to raising £4m for WWF: half from its 10 million or so viewers and the public at large, and half in matched funding from the broadcaster itself.
Saving the Amazon is core to WWF’s objectives as a globally minded conversation NGO. And £4m is a large chunk of cash, especially at a time when purse strings are tightening and many charities are struggling to keep afloat.
But, there are inevitably concerns about the business-like contractual arrangements emerging between sustainability non-profit groups and corporations.
Advocates of a more participatory approach insist that the benefits outweigh the possible downsides. Their arguments typically boil down to two salient factors; namely, the sheer size and influence of the private sector.
Sustainability is a complex, multi-faceted issue, the theory runs. To design appropriate solutions, all players must be around the table. Failing to include business is therefore an ideological blind spot and a debilitating oversight.
June 1992. That’s the date the penny dropped. Or so says David Bent, deputy director of sustainable business at UK sustainability charity Forum for the Future. It was during that specific month that thousands of environmentalists and policymakers descended on Rio de Janeiro for the Earth Summit. Businesses, it should be said, were notably absent at the time.
Bent describes the landmark conference as signalling the shift from a “we need to do something” mentality to a “let’s try to get things done” mindset. “As nice as it is to think of yourself as the white knight charging forward, actually change on a global scale doesn’t happen just through heroes,” says Bent. Hence the invitation to corporations to get on board.
Forum for the Future has done more than most to promote the partnership model. It’s there in its language. Phrases such as “help businesses”, “work with others” and “share what we learn” litter its public statements.
It even calls the 100 or so businesses with which it has dealings – a list that includes the likes of oil major Shell, agribusiness Cargill and cement and aggregates firm Lafarge – as “partner organisations”. This is to be expected from business-led sustainability groups, such as Business for Social Responsibility or the World Business Council for Sustainable Development, but such a seemingly pro-business stance remains atypical for most independent non-profits.
The line between “partners” and “clients” is certainly a fine one. Forum’s advisory services can seem close to those of a commercial consultancy. So too does its fee structure. Companies can buy different levels of engagement, from basic (“membership”), to moderate (“partnership”) through to advanced (“premier”). The price tag differs accordingly, from £5,000 to £35,000.
The basic membership package includes access to networking events, “cutting-edge practical tools” and a direct line to Forum, among other benefits. For premier partners, the list is longer and significantly more hands-on.
WWF is less publicly explicit about its commercial arrangements. It offers a similar suite of options for involvement, however. Companies can choose between licensing or sponsorship arrangements through to what WWF terms “technical” or “transformational” partnerships.
The latter is where the charity hopes real step-changes will occur. “WWF has moved from philanthropic relationships to deeper partnerships that encourage businesses to improve their environmental performance and to play a role in taking us towards a nature-friendly economy,” says Dax Lovegrove, WWF’s head of business and industry.
Partnership-orientated sustainability NGOs are not short of positive case studies. Forum’s expertise in future modelling, for instance, has delivered tangible results for a range of companies that are looking to modify their business models light of climate change and other sustainability challenges.
The development of common tools and processes for reducing shipping-related carbon emissions under the rubric of the Sustainable Shipping Initiative is illustrative of the sector-wide benefits that a partnership approach is bringing.
WWF’s leadership of cross-sector “roundtables” for key agricultural commodities such as palm oil (see p26), soya and sugar also bolsters the case for combining “individual strengths [to] forge extraordinary change”.
Unsurprisingly, we hear less about the risks and failures. In contrast to contracting a private consultancy, teaming up with a charity offers corporations a reputational boost. In the case of cause-related marketing and other more consumer-facing collaborations, it can result in a jump in sales as well. But what’s in it for the charity? There is a risk of being taken for a ride.
Getting the rules straight
Under law, there is nothing stopping charities taking money from businesses in the form of donations (presuming, of course, that the money is legally obtained and used). And many charities do so. Recent research by the World Bank-based research group CGAP indicates that corporate support for UK charities amounts to about £1.6bn a year. That equates to roughly 5% of the voluntary sector’s income.
Receiving money for services rendered, rather than as straight donations, is a different matter. Charities operate under legal charters that accord them fiscal advantages and other financial benefits. These are premised on the delivery of public goods in exchange. If a charity is found to be providing paid-for services without the commensurate public goods, then alarm bells will start to ring.
Some charities have found it easier to spin off their advisory arms into explicit for-profit entities. The emblematic example is AccountAbility. Founded at a similar time to Forum with a similar partnership-orientated mindset, it now operates an advisory services arm.
As a for-profit entity, it has the stated objective of helping “clients increase revenue, manage risk, and enhance brand and reputation”. The New Academy for Business, another partnership-based charity set up in the mid-1990s, had less success and folded.
For those bent on pursuing the partnership approach under a charitable banner, the establishment of clear rules of the game is critical. Designing some form of contract is “essential”, according to Darian Stibbe, executive director of the Partnering Initiative [thepartneringinitiative.org], a UK-based non-profit. Having a formal agreement helps “ensure that there is 100% clarity on what the partnership is going to achieve and what each of the parties is going to do to achieve those objectives”, he explains. Key issues to cover include the use of logos and intellectual property, publicity and communication and – all importantly – “what to do if something goes wrong”.
Most partnership-based sustainability charities have taken such advice on board. Forum’s approach in this respect is exemplary. To become one of its “pioneer partners”, companies must meet five explicit commitment criteria (see box). These are agreed up-front and reviewed annually during the three-year period such partnerships typically last.
“We do not take anyone that walks through the door,” says Bent. In addition to its preference to working with industry leaders, where it can Forum opts to team up with companies in its core areas of concern: namely, food, energy and finance.
In the same vein, WWF’s Lovegrove says a main challenge for his organisation is “to find ambitious partners who are prepared to break new ground”. He confirms that WWF has decided not to pursue a number of partnerships “after extensive explorations” revealed a notable difference in ambitions.
As to the issue of terminating partnerships, Stibbe argues that there are a number of strong grounds for doing so.
Some are obvious. If allegations of unsustainable or unethical activities by a company partner threaten the charity’s brand, then that’s good reason to walk away.
Irredeemable differences of ethos and culture represent another motive to split. Not meeting objectives makes his list too. “You try to re-engineer it so that [the partnership] is achieving its objectives,” Stibbe says. “But if that doesn’t work, then of course you close it down.”
Forum says this reflects its own policy. For confidentiality reasons, Bent will not name names, but he says that “a number” of partnerships have been cancelled over the years.
That said, severing things is very much a last resort, however. “We have terminated our relationships on the rare occasions when companies don’t comply, usually after a series of warnings and a final year to turn things around,” he says. So partners do get plenty of opportunities to improve.
Likewise, WWF says it cancelled a deal with Powergen (before its acquisition by E.ON in 2002) because its policy of green tariffs failed to meet its goal of “transformative” change.
If partnerships are as important as sustainability experts maintain, then it behoves all those involved in the sector to find workable models. The general feeling in the non-profit world is that charities are still finding how they can best engage with business.
A few pioneers are taking the lead, putting partnerships front-and-centre of their mission to promote sustainability. But before more follow, it’s important to establish exactly where the lines lie and how the non-profits can most effectively make the change that is their organisational reason for being. And there must be rigorous scrutiny to ensure that the line between a partnership and a consultant-client relationship isn’t breached.
Forum for the Future’s pioneer level partner programme
Forum for the Future offers a variety of partnership “products” for companies that are looking to engage on sustainability issues. The highest level of engagement is the “pioneer” level. This is open to only a “limited number” of companies.
Companies at this level must:
- demonstrate clear sector leadership or provide evidence of sector leadership aspirations;
- allocate a partnership manager and board-level partnership patron, with regular check-ins;
- ensure work programmes move the organisation forward at pace and with stretching targets for change;
- guarantee an annual board session takes place; and
- engage at the level of business strategy and sustainable development strategy.
In return, companies will:
- receive an extended tailored advisory programme;
- have partner support and senior-level engagement;
- receive membership of Forum’s sustainable business models group;
- be entitled to involvement in Forum’s system innovation lab;
- be a placement host for Forum Masters scholars;
- have an annual dinner with founder and director Jonathon Porritt;
have opportunities to communicate through Forum’s magazine, including being able to republish content and advertise; and
- have standard membership level benefits, such as access to exclusive network events, subscriptions to magazines and a bi-monthly newsletter.
Marks & Spencer
WWF’s model for working with business
Why should companies partner with WWF?
According to WWF, only the smartest, most sustainable companies that value nature will continue to thrive in the future. WWF’s knowledge and insight can help companies make a positive contribution to the planet. It says there are “exciting opportunities ahead”. To realise these, it’s necessary for businesses to unleash “the power of new thinking and innovation”. Given expertise and experience, WWF sees itself as “the ideal business adviser or partner”.
Why WWF partners with business
WWF’s vision is a planet where business makes a “restorative contribution” to our natural world, supports the Earth’s adaptation to a changing climate, and benefits human well-being. To achieve that vision requires, WWF believes, engaging with the private sector, not hurling bricks from the sidelines.
WWF insists that it’s not enough to work with companies that are already doing everything right. That will only lead to incremental change. What WWF aspires to is market transformation by radically altering the way companies do business. To achieve that, it forms what it describes as “challenging and constructive relationships” with businesses that are able to drive “real, lasting change”. That includes promoting green innovation and developing “progressive strategies” that tackle environmental risks and engage a wider audience.
Critiques of WWF’s “constructive engagement” model
In June 2011, the German TV station ARD broadcast a documentary titled The Silence of the Pandas: What the WWF isn’t saying. The film, which was later released in English on the internet, has an accompanying book – Black Book WWF: Shady deals under the sign of the panda.
The work of German filmmaker, Wilfried Huisman, the film provides a powerful critique of WWF’s alleged legitimisation of unsustainable business activities. Huisman focuses particularly on self-regulatory schemes to establish green certificates for commodities such as timber, sugar, palm oil and soy. In response, WWF said it didn’t “recognise” the image of it portrayed in the film, and said it was “saddened” by the filmmaker’s sloppy fact checking. The conservation charity also reaffirmed its decision to work with business on the grounds that “it gets results”.
Also in 2011, UK campaign group Global Witness released a report criticising WWF’s Global Forest and Trade Network (GFTN) – as featured in Ethical Corporation. Established over two decades previously, GFTN represents loggers, processors and retailers, which collectively represent one fifth of the world’s timber trade. WWF offers its corporate members technical assistance in sustainable forest management.
In the report Global Witness claimed to have identified “serious systemic problems”, including a lack of transparency, inadequate rules for membership, and instances of weak performance, monitoring and enforcement. Most seriously, Global Witness said that the procedures to assess whether the scheme is actually contributing to sustainable forestry are inadequate.
In response, WWF conceded that some GFTN partners have “a way to go” on their journey to sustainability. Yet it argued that these are “precisely the companies that should be in GFTN”. It also confirmed that those caught flouting the “rules and spirit” of GFTN would be removed from the network.
WWF and Ikea: responsible cotton production
The WWF-Ikea partnership, which began 10 years ago, works to transform commodity markets, with a particular focus on responsible cotton production and forest management.
“It’s contributed directly to an increase in the forest areas that are now FSC-certified, particularly in eastern Europe”, WWF says. The partnership has helped around 45,000 cotton farmers in Pakistan and India to grow “better cotton”, significantly reducing their water and chemical use and increasing their profit margins as a result.
Source: WWF-INT Annual Review 2012business strategy NGO Oliver Balch sustainability