by James Chen | 18 Apr 2018
Walking through campus on my first day as a student at the University of Chicago in 1978, I came across a small but vociferous gathering of “Students for a Democratic Society”. Grouped together outside the business school, they were shouting chants condemning the free market ideas being promulgated by the “Chicago School” professors inside.
The thinking of the Chicago School of Economics of the time was immortalized by Milton Friedman’s Nobel-prize winning monetary policy, which is often captured by the famous adage “the social responsibility of business is to create profit.” It was a radical idea at the time, and hotly defended by the economics majors and business school students of my student era.
But, like so many economic theories of both ‘the left’ and ‘the right’, it’s safe to say it has not survived the test of time.
However, what the Chicago professors inside the business school and the protesting students outside did agree on, was the fundamental importance of the corporate world to modern society.
For the insiders in their ivory tower, the corporate world was the primary force for increasing the “common wealth” of society – for the students outside it was an amoral instrument of subjugation and inequality.
Today, while Freidman’s economics have fallen out of favour, that debate between the ‘insiders’ and ‘outsiders’ is alive and more relevant than ever.
As the corporate world grapples with the dominance of ‘Corporate Social Responsibility’ and the rise of social business models, the same debate rages on.
‘Can the corporate sector be a force that not only increases but improves the “common wealth”?’ or do its profit-motives render it irrefutably an amoral instrument of increasingly sophisticated oppression, through the exploitation and manipulation of customer data or an ever-entrenching force of inequality as we witness the hollowing out of well-paid blue-collar and middle-class jobs?
As I was in 1978, I remain a believer in the private sector; I am certain that the corporate world can be a force for extraordinary good.
However, if the corporate world is serious about achieving social impact, I would argue that CSR needs to evolve far beyond the bolt-on strategies and tactics in vogue today.
Instead, progressive companies must implement a clear, transformative and binding vision of the company’s mission as a force for good. That’s no mean feat – it requires imagination and above all long-term, dogged commitment.
As a venture philanthropist I straddle two worlds; the private and the philanthropic sectors. At the cutting edge of private philanthropy is a concept called ‘audacious philanthropy’ which captures exactly the mentality I believe socially-responsible businesses must take up.
In an article for Harvard Business Review, Susan Wolf Ditkoff and Abe Grindle have examined this concept in depth. It is based on recent research from Bridgespan (the non-profit affiliate of Bain Consulting) that analyzed 15 of the most successful, world-changing social impact initiatives in the past century: including 911 emergency services, tobacco control, and polio eradication.
Across the research, four patterns emerged: over 90 per cent of initiatives took over 20 years to achieve the objective, 80 per cent required changes to government funding, policies or action, 75 per cent involved active coordination among key actors across sectors and 66 per cent featured donors making one or more philanthropic big bets, a big bet being USD10 Million or more of risk capital.
Of course, in the corporate context, realistically, very few, if any corporations, would have the risk tolerance to engage directly in audacious philanthropy because of the accountability challenge.
Nevertheless, key lessons from the successful practice of audacious philanthropy can be applied to businesses truly aiming to re-write the social-impact of business. They are deep, long-term engagement and intelligently focused funding around a specific cause – investing the time to develop and apply domain expertise for outcomes rather than outputs.
I have seen first-hand the impact of this sort of audacious thinking at the heart of corporate organizations.
As perhaps the leading philanthropist in advocating for “Vision for everyone, everywhere”, it has been my honour to witness the ongoing transformation of Standard Chartered Bank’s “Seeing is believing” CSR campaign. Over the last few years, what began as a very successful stakeholder engagement initiative has become an audaciously ambitious project.
In structuring the original “Seeing is believing” campaign, a key feature was a commitment to raise USD100 Million from employees and customers, match funded by the bank to support avoidable blindness.
Through the process of allocating the funding raised, Standard Chartered gradually developed their own domain expertise and institutional knowledge of the challenges in tackling the subject.
On the wider issue of poor vision, of which avoidable blindness is approximately one per cent, there are currently 2.5 billion people around the world today who are affected. And for 90 per cent of those with unaddressed poor vision, a simple pair of glasses is all that is needed for vision correction. It’s a challenge I have championed in my own 13-year journey to solving this ironically invisible issue and which my campaign, Clearly, aims to address. In the same vein as Standard Chartered, with their focus on avoidable blindness, I have become passionate, ambitious expert about this issue – the largest unaddressed disability in the world today.
On March 12, 2018, The Queen’s Diamond Jubilee Trust unveiled an initiative to raise USD1 billion catalyst funding for developing countries [not just Commonwealth] to build their capacity towards the goal of ‘Vision for Everyone, Everywhere’, starting with solving the issue for the 900 million people struggling with unaddressed poor vision in the Commonwealth countries today.
Standard Chartered is a key supporter of this proposed Vision Catalyst Fund. But they bring much more than ‘passive’ capital; they are actively contributing their domain knowledge and insight from funding other similar initiatives. This increasingly audacious engagement with the issue of ‘Vision for Everyone, Everywhere’ puts into action the bank’s stated mission to be “Here for Good”.
In many ways, the student protests of 1978 feel like a lifetime ago. The corporate world has undergone a veritable transformation since then – with giants like BlackRock’s Larry Fink arguing that “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.”
But to achieve such audacious goals, the corporate world will have to prove to those student protestors that it can commit not only ‘big bet’ money, but invest their time and their expertise in the long-term.