The relationship between business and philanthropy goes back to ancient Egypt around 1800BC. At that time it was believed that if an individual was to enjoy a smooth passage to the afterlife and achieve immortality, they had to convince the gods that during their life they had performed various acts of philanthropy.
By the time of the industrial revolution, philanthropy as we know it today started to become established as multi-millionaire industrialists invested a percentage of their fortunes in building what were, at the time, state-of-the-art homes and “model villages” for their employees; they financed care-homes for orphans, improved the provision of healthcare and even established national parks.
Modern philanthropy has both ethical and environmental elements, which are driven by the ever-growing demands of customers who want to know that they are purchasing products and services from companies whose processes are environmentally friendly and that their suppliers are paying a “living wage” to their employees around the world.
As a result, many companies are beginning to take a more ethical approach to how and where their raw materials are sourced. Starbucks, for example, keeps a check on how and from where its coffee beans, tea and cocoa are harvested. The company provides the farmers growing its products with support centers, training and loan programs, and has committed itself to improving their social, environmental and economic standards. In partnership with Conservation International, Starbucks claims that the lives of more than a million farm employees in countries all around the world have been improved.
John Hailer, president and CEO of Natixis Global Asset Management, is typical of the new breed of philanthropists. He has made it his mission to ensure that the company’s asset management business responds to the needs of intermediaries, institutions and individuals by providing the right solutions globally. John Hailer’s philanthropic work is centered on the Berklee College of Music, which aims to create a global laboratory for musical discovery and artistry, to promote the power of music to change lives for the better and to transform the current model of higher education.
By working to improve the living conditions of their suppliers and employees, especially those in developing countries, companies benefit by having access to a better educated and healthier communities of workers that have been trained in the latest farming or production techniques. This, in turn, leads to higher levels of productivity, which translates into increased levels of profitability for the company and higher wages for the workers. A more highly trained and educated workforce leads to improved manufacturing and growing techniques, which reduces damage to the environment.