Wednesday, July 11, 2012

Business as Charity: The Ever-Evolving World of Social Impact

As someone who takes social-impact work very seriously, I’ve found the Stanford Social Innovation Review to be an invaluable window into the world of social and economic justice.

I recently came across an interesting SSIR blog post which touches on what I think is a very constructive development in the world of charity: business as charity.

In our current economic climate, where job creation is a keystone in every political campaign, Jim Koch, founder of the Boston Beer Company (they make Samuel Adams beer), decided that instead of giving money to charity he would become, essentially, a microlender. His new program, called Samuel Adams Brewing the American Dream, gives small loans to small food, beverage and hospitality businesses in South Boston.  It also provides free coaching and mentoring from members of Koch’s team. The point? Trying to create new jobs by supporting small business rather than non-profits.

This is an excellent idea. Even a small loan can determine whether a micro-entrepreneur’s business succeeds or fails; I’ve seen this firsthand in my own business.

At ThinkInk we recently launched a PR and thought leadership campaign for a Miami-based microfinance company, OUR Microlending. To date, the company has disbursed about $6.2 million in loans to over 600 small businesses across South Florida, including a Colombian souvenir store, a printing and vinyl signage shop, a cell phone accessories wholesaler and a nutritional consulting and supplement store. These are hardworking entrepreneurs whose loan applications were rejected by the big banks. Because of OUR Microlending’s services – which are sorely needed all over the United States, not just in the developing world – these self-starters have been able to grow their businesses and create jobs to help stimulate their neighborhood economies.

Of course, this is not to say that I don’t think we should support nonprofits. In fact, we are in the process of restructuring The ThinkTank, a division of ThinkInk that is devoted to helping nonprofits grow their organizations through visibility and intelligent PR. We’re recreating the company into a for-profit/nonprofit hybrid that would allow us to significantly expand to this unit to help more nonprofits throughout South Florida.

In his SSIR post, author Aaron Hurst, founder of the Taproot Foundation and a well-known leader in the world of non-profits and social-impact, asks: is business the new charity?

I’d have to say no. Charitable giving is still crucial to nonprofits’ ability to fulfill their missions. However, considering how difficult it is today for the owners of very small businesses to access traditional banking services, I hope to see many more programs like this spring up to help create much-needed jobs and re-energize our still-shaky economy.

Tuesday, July 10, 2012

Even Decade-Old Lies and “Omissions” Can Wreak Havoc on a Brand.

One would think that in our 24/7 news cycle and oversharing age, companies and celebrities – who depend on public goodwill to remain famous and profitable – would resist the impulse to lie or cover up less-than-flattering information.

Perhaps guess GlaxoSmithKline and “Dr. Drew” Pinsky missed that memo?

Last week it was revealed that Dr. Drew, an addiction specialist and host of Loveline and Celebrity Rehab took more than $250,000 from the British-based pharma giant in the late ‘90s to talk up its antidepressant Wellbutrin on Loveline.

Even as he touted the drug for its effects – or lack thereof – on libido, the good doctor neglected to mention he was being paid to promote the drug.

$250,000 is a rather handsome sum of money, but in failing to disclose his financial link to GlaxoSmithKline, Dr. Drew ended up doing a great deal of damage to his own brand – more than a decade down the line.

As a PR practioner, I’ve said this so many times to my colleagues and will continue to until I’m blue in the face: Dishonesty will always come back to bite you on the behind

The GSK kerfuffle could end up costing Dr. Drew far more than money – just read some of the comments following a recent CBS News report:

“Dr. Drew, too bad you can't put the toothpaste back in the tube once it is out. You are now and will forever be a pharma shill. Unlikely that you will ever be seriously considered an astute medical practitioner.”

That’s what I mean about being bitten in the bottom.  I wouldn’t want to be associated, even tangentially, to what officials are calling “the largest case of healthcare fraud in US history.” No sum of money can make up for such a loss of credibility – in my mind, at least.

I recently wrote a post about the massive PR blunder committed by lobbyist Stephanie Harnett of Mercury Public Affairs on behalf of Wal-Mart: she posed as a reporter to infiltrate a meeting of union members opposed to a planned Wal-Mart in Los Angeles. She was caught, then fired and managed to garner some (more) negative press for Wal-Mart, the exact opposite of what she – and her previous employer – had intended. Not that Wal-Mart is a stranger to awful press, of course.

While these are two distinct scenarios, they both raise the issue of lapses in professional ethics and serve as yet another reminder that dishonest behavior in business, particularly in our always connected age, can backfire disastrously.

So what have we learned from GlaxoSmithKline and “Dr. Drew” Pinsky?

Credibility is our most important asset. If we don’t have that, we don’t have a business. At least not a business worth having.