Press Release

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Cheryl Kiser
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August 1, 2003

The following op-ed was distributed by Knight Ridder on July 31, 2003:

THE COMMUNITY OF BUSINESS
by Bradley Googins, Executive Director of The Center for Corporate Citizenship at Boston College; and Barbara Dyer, President and CEO of The Hitachi Foundation

As the economy does its Little Train That Could imitation, huffing and puffing out of recession and toward acceptable growth, America's corporations are slashing everything, including and especially philanthropy, to keep profits and return-on-investment chugging along. That's certainly the stereotype. It's just that it's not true.

Yes, as recent media reports attest, there are major corporations being forced to cut back on giving, especially businesses operating in the hardest hit sectors, as is the case with many of the companies being cited in the press.

In the age of "it must bleed to lead" reports that corporations are slashing their contributions makes the story. And there is no doubt that America's corporate leaders can and should do more to contribute to the communities where their companies operate. But the notion that businesses are simply and uniformly cutting back is simplistic and inaccurate when the full range of businesses in America is considered.

A new survey conducted by Boston College and the U.S. Chamber of Commerce, and funded by The Hitachi Foundation, reveals that the economy is not chasing business away from social responsibility. Indeed, regardless of economic pressures American businesses are remarkably committed to the communities in which they operate. Seventy percent of businesses of all size contribute cash to nonprofit organizations while 57 percent donate goods and services. Thirty-three percent have a company volunteer program.

The business of business is business, is how Milton Friedman described it, except business doesn't seem to believe it. What the data reveal is that business involvement in the community is deep, durable, and varied. Over the past year, 86 percent of companies have invested more or kept their investment levels in corporate citizenship the same and 90 percent have either increased or kept level their commitment to helping distressed communities. It's even more impressive when you look at businesses' community investments compared to their own financial performance - business performance is surprisingly only loosely related to active social responsibility. During the past year, of those companies that reported above average or excellent financial performance, 38% increased their investment in corporate citizenship and 29 percent increased their investment in distressed communities. But poor performing companies didn't lag far behind. Twenty-three percent of these companies spent more, not less, on corporate citizenship and 22 percent put more into distressed communities than they had the year before.

Business attends to the bottom line. But the ethos of social responsibility also runs through much of America's corporate leadership. What's also clear from this survey is that American business does accept the notion that corporations are citizens with responsibilities and obligations that go beyond making money, paying taxes, and providing jobs. Seventy-five percent of businesses say it's their own tradition and values that push them to be good corporate citizens. And the vast majority of business leaders not only accepts, but believes, that the public has every right to expect that businesses tend to more than just business.

Painting a picture of American business as pulling back from its social responsibilities and interactions during hard economic times fails to take in to account the relationship between corporations and communities. Whether small, medium, or large businesses - and the survey showed no significant difference in commitment to corporate citizenship among the three - businesses in this country are as much a part of their communities as the Kiwanis Club. The mutually beneficial obligations, social entanglements, and reciprocity are too great and long-lasting to be tossed aside when hard times hit. It doesn't happen when neighbors in a neighborhood experience tough times. As this first-of-its-kind survey reveals, it also doesn't happen when one of those neighbors produces product or sells goods.

Bradley Googins is the executive director of the Center for Corporate Citizenship at Boston College. Barbara Dyer is the President and CEO of The Hitachi Foundation, based in Washington, DC. Dr. Googins can be reached at The Wallace E. Carroll School of Management, 36 College Road, Chestnut Hill, MA 02167-383. Ms. Dyer can be reached at The Hitachi Foundation, 1509 22nd St., N, Washington, DC 20037-1073.