Why Philanthropy Is Not The Same As Sustainability

Donating money to our favorite charities is a great way to show our support for the issues we’re passionate about and over the past hundred years or so, businesses have become increasingly involved in philanthropy. 

We see this more and more in the uber-wealthy; people like Bill Gates, Jeff Bezos, Warren Buffet, and the list goes on. This practice was originally adopted by the former financial heavyweights in American society. Andrew Carnegie, J.P. Morgan, and John D. Rockefeller were the three major “Titans of Industry” during the industrial revolution, but they also spent large sums of money on philanthropic endeavors. 

But there’s one common problem among all six of these men - their donations have done nothing to address the impacts their businesses have had on people and the environment. 

Let’s take a deeper dive into Jeff Bezos. Back in May, Bezos donated more than $100 million to an undisclosed nonprofit. At face value, this is amazing, that much money could do so much good in the world! However, as Rachel Sandler at Forbes clarifies, this isn’t physical money taken out of Bezos’ wallet - instead, he transfers Amazon shares to the nonprofit for them to sell at their discretion. For this particular donation, Bezos gifted 47,727 shares. 

Maybe I’m splitting hairs, but I feel there is a big difference between reaching into your own pocket to make a donation and gifting shares…

Since we’re talking numbers, let’s assess Bezos’ donation record. In Sandler’s same Forbes article, they estimate that Bezos has donated $2.4 billion in his lifetime; quite a chunk indeed. However, compared to his net worth estimated at $141.6 billion, seems like a drop in the ocean. And I have to ask the question - what could one person possibly do with $141.6 billion?? As much as I want to explore the psychology of the ultra-wealthy and American attitudes towards wealth, I’ll leave that to the experts on the topic. 

For now, let’s stick to sustainability…I have one last point that’s really gnawing at me - Amazon’s business practices.

Beyond enabling our overconsumption, the elephant in the room is emissions. According to Bloomberg, Amazon’s emissions grew 18% in 2021, releasing 71.54 million metric tons of CO2E. Although Amazon has a goal of becoming net-zero by 2040, there are a number of concerns they still have to address. When accounting for carbon, Amazon has only accounted for Scope 1 & 2 emissions (with the exception of emissions generated from private label products). So what about all the other products that Amazon sells? Should Amazon factor those in when assessing their footprint? Should they require their suppliers to do so? The supply chain is tricky, there is no doubt about that. 

While I’ve spent most of this article focusing on Amazon, this problem is evident in most businesses. Brands who choose to participate in philanthropy are doing their part to be socially responsible (to an extent), but this cannot be the only effort to do business better. 

One example we see of this is beach cleanups. It’s awesome that brands want to partner with nonprofits to clean local beaches, but this isn’t where the largest impacts are. Like we always say, the biggest impacts are furthest back in our supply chains. By continuing with “business as usual,” those people in developing countries that make our goods will continue to suffer. Water pollution, exposure to hazardous chemicals, gender inequality, and other issues still exist in our supply chains, and unfortunately, that beach clean-up isn’t going to do much to address these issues.

This concept was explained to me in a great way - “why would you clean up someone else’s backyard when your own yard is a mess?” 

We’re not suggesting brands abandon philanthropy, but this can’t be the main approach to sustainability. Instead, it should supplement it. Capital has to be directed to cleaning up business practices. Think preferred materials, waste management solutions, supply chain traceability, and so on and so forth. Sustainability and philanthropy can co-exist in a brand, but they certainly are not interchangeable. 

So, what can you do to support both sustainability and philanthropy? Here are some tips:

If you work at a brand:

• Ask your sustainability office about how they plan to address philanthropy and sustainability as separate issues
• Don’t have a sustainability office? Start the conversation with your coworkers and leadership (the UN SDGs are a good place to start!)
• If you’re stuck on how to get started, try reaching out to a brand that has well-developed philanthropy and sustainability programs (email us at [email protected] if you need a list of recommendations) 

If you’re a customer:

• Research brands who are doing good work in the space, most brands will have this information available as a separate page on the website
• Learn as much as you can about the social and environmental impacts of the lifecycle of a product (this is something we can help with if you don’t know how to start - email us at [email protected] to learn more)
• Stay up to date - some of our favorite resources for sustainability and philanthropy are GreenBiz, TreeHugger, EcoTextile News, and Sustainable Brands

What are your thoughts on philanthropy and sustainability? Did we forget to mention anything? Head over to our LinkedIn Group to join in on the conversation! Want to watch sustainability videos that can help make you an expert on the topic? Check out our YouTube channel filled with career advice, must-knows, and brand breakdowns.

Thank you and I’ll see you guys in the next blog post!

McKenzie

#philanthropy #sustainability #keeplearning