Obstacles to Business-Charity Partnerships: Lessons From Both Coasts

To the Editor:

In their recent opinion piece in The Chronicle, Shirley Sagawa and Eli Segal advocate the fostering of partnerships between the business and charitable communities (“Break Down Barriers to Business-Charity Partnerships,” My View, December 16). Such partnerships, they say, will require new governmental policies, hard work, and such qualities as “faith, imagination, and will.”

We at the Hitachi Foundation agree that such partnerships are necessary. But if we really want to marry the interests of corporations and communities, there are two important lessons that all of us had better heed. Let’s call them the East Coast lesson and the West Coast lesson.

The West Coast lesson grows out of the recent World Trade Organization meeting in Seattle. As that debacle so vividly demonstrates, distrust is a major obstacle to any community-business partnership. Although businesses and community organizations create partnerships with other organizations every day, the placard-carrying activists and the briefcase-carrying trade-organization members instinctively were reluctant to work together to discover where their interests intersected. Unless such distrust is addressed, it is likely to spin out of control.

The East Coast lesson is that the principal incentive driving business today — the need to increase stock value — doesn’t lend itself to building community-business partnerships. Wall Street is the driver; C.E.O.’s come and C.E.O.’s go, based on stock performance. Stock value is such a vaunted measuring instrument that an entire sector of the economy, e-commerce, currently is thriving not because it’s profitable — few companies are making any money — but because Wall Street is enamored. Under such conditions, it is difficult to imagine most large corporations’ viewing social partnerships as a necessary part of doing business.

Although both mutual distrust and the lack of incentives are daunting obstacles, they can be overcome.

The West Coast lesson — overcoming distrust — is perhaps the easier of the two. On those occasions when business and community people get to know each other and deal openly and directly at the beginning of the relationship with the mutual mistrust, stereotypes generally dissipate and real work gets done.

In Massachusetts, the Hitachi Foundation is funding the Massachusetts Youth Teenage Unemployment Reduction Network (MYTURN), where teachers and members of the business community are working together to educate young people. Teachers are finding that businessmen and businesswomen want the same thing they do: well-educated graduates who can succeed in the workplace. And business people are finding that teachers aren’t the detached and dejected caretakers that they hear about in the news media.

The result? MYTURN has developed a curriculum that schools can use to teach skills that can be readily applied in the workplace. MYTURN and several other such projects around the country are proving that the distrust can be laid to rest.

The East Coast lesson, the lack of incentives to forming partnerships, may be trickier. First, we must develop better tools so that C.E.O’s can assess the return on business social investments. The current tools, crude as they are, suggest that companies that care about their communities and feel a social responsibility do better than companies that don’t. Earnings are influenced by corporate social practices. Better tools would enable business decision makers to see the bottom-line benefits of social partnerships. In other words, better tools would connect doing good with how C.E.O.’s are judged by Wall Street.

In the new century, business-community partnerships are vital to insuring a just society. When communities and businesses get together in pursuit of enlightened self-interest, the bottom line of each is raised.

Barbara Dyer
President
Hitachi Foundation
Washington