Harmony with Non-Government Organizations

As is the case with relationship with any stakeholder, the fundamental objective of your relationship with non-governmental organizations (NGO) is to make money. To earn money or to avoid losing money. Which is essentially the same thing as ‘the dollar saved is a dollar earned’.

Therefore, of literally millions of NGO (USA alone has 1.5 million of them), only four types are of practical interest for business entities. Charities, clubs (self-explanatory), campaigners, advocacy/lobbying and watchdog.

Charity NGO (which belong to the operational NGO category) mobilize financial resources, materials, and volunteers to finance specific programs or organizations (schools, medical centers and the like).

Campaigning NGO seek to achieve large-scale change – political, social, economic, etc. - by influencing the political system (government entities) at all levels. These NGO use an efficient and effective group of professionals who are able to keep supporters informed, and motivated. They plan and hold demonstrations and events intended to keep their cause in the media. They usually maintain a large informed network of supporters who can be quickly mobilized for events to garner media attention and influence policy changes.

The primary purpose of an advocacy NGO is to defend or promote a specific cause (e.g., human rights in general, gay rights, workers’ rights and so on). These organizations typically strive to increase awareness, acceptance and spread knowledge by lobbying, using media and conducting activist events.

Watchdog NGO are constantly monitoring selected targets such as businesses, government entities, etc. looking for ‘wrongs’ – illegal and unethical behavior. After detecting what they believe is illegal, unethical or harmful – to population in general, social group such as gays or children, environment, etc. the watchdog begin to pressure the ‘violators’ and the appropriate government agencies by direct action, media articles, social networks, blogs and even legal action to ‘right the wrongs’.

How you make money with your NGO relationships? High-profile charities and especially their fundraising events present excellent opportunities for business networking (i.e. two-way communications) and even doing business (thus generating financial value) in the informal environment. Ditto for various clubs for executives, politicians, etc.  

Also, active involvement in high-profile charity causes in some cases might make corporate brand more emotionally attractive – by adding the image of a ‘good corporate citizen’. Which sometimes becomes a serious competitive advantage – or even a necessity. Not everyone is as powerful as Apple Inc. that can afford to spend exactly zero on charity – and get away with it.

What you have to give back? Money – in the form of generous (or not-so-generous) donations. Time and effort of your employees who help with fundraising efforts and other needs of the charity. How generous? Just enough to receive a competitive NPV and IRR/MIRR from these activities. 

Competitive with other possible investment projects, that is. Apple Inc. definitely subscribes to this philosophy. It simply believes there always are projects more financially valuable than charitable donations.

If you want to make money with campaigning NGO, you must identify the specific campaign aimed at bringing changes that will benefit your company. In terms of financial, functional and emotional value. And support these changes – financially and operationally. Always keeping in mind, though, that it is an investment project. That requires that (a) you calculate in advance the values of usual KPI and (b) these values meet your acceptance criteria for investment projects.

You do the same with advocacy NGO, only in this case you must identify a specific cause.

You can not make money with watchdog NGO, but you can definitely lose money – and sometimes a lot of it – due to their activities. Greenpeace is a good case in point. To prevent it from happening, you must (a) compile the list of watchdogs in your industry and geographic area; (b) study and monitor them to find out what might make them go ballistic and (c) structure your operations in such a way as not to provoke them into potentially costly actions.