President Clinton just asked Neville Isdell, chairman of the Board at Coke, a question that he was mulling over in a private briefing I was lucky enough to attend on Tuesday. He asked whether the economic crisis would cause companies to cut their philanthropic activities.
Isdell believes that the business philosophy that leads to that prediction is outdated, and this is, in part, due to the benefit that employees get from working for a company that is engaged in good works. Common economic theory states that the higher a salary (plus benefits) a company offers — to a point — the better an applicant pool they’ll get, the higher quality employees they’ll have, and the more profit they’ll make. If you consider the desire to work for a company that does good a tangible benefit, then aggregate salary will be higher for companies that are engaged in philanthropy, and their profits will be higher.
This, of course, presumes a broad desire among the populace to work for a conscientious company, which I believe to be true, and that the knowledge of this benefit is widespread among business leaders, which I hope to be true. It’s also fails to compare the relative benefits of a company spending on good works and of it spending its money elsewhere. If profits continue to constrict, that will certainly be prove to be even greater a consideration.
How do you make sure that this benefit is properly considered? Simple. If you care that your company is engaged in good works, let them know about it.