The Best Kept Secret: The Role of Corporate Foundations in Building Sustainable Brands

By Karoline Heitmann, Priscilla Boiardi, Lonneke Roza, Steven Serneels, EVPA

In this blog, we argue why corporate foundations are the ideal partner for companies in building a truly sustainable brand. Find out what makes them a unique partner, what contributions they can have, and how you can leverage this partnership most strategically.

For too long, companies have overlooked and undervalued the role of corporate foundations as partner for sustainability. Corporate foundations have been perceived as a nice social appendix to a company’s CSR report, or as a means to fulfilling the moral responsibility and stakeholder pressure of being a good corporate citizen. Lately, however, front-running companies are starting to recognise and acknowledge corporate foundations as an important strategic partner in building sustainable businesses.

At EVPA, we discussed with practitioners and experts how corporate foundations can push the sustainability agenda of companies. Here is what we have learned.

1. The advantage of having a strategic partner with a dual hat

Corporate foundations are not only at the frontline of social impact and highly integrated within the social impact ecosystem, but they are also simultaneously sharing an ongoing relationship with the company. Consequently, they have a comprehensive understanding of the social issues and dynamics in society – and the ways they can contribute to solving those issues – but they also know the corporate context and can spot opportunities for the business to drive social impact with business relevance.

Due to that dual hat, corporate foundations are the key strategic partner for companies that want to build a sustainable business.

2. Corporate Foundations help companies build a pipeline of investable social innovations

Corporate foundations have the achievement of a sustainable impact at the core of all their activities. As such, corporate foundations do not feel the pressure to generate short term business value for the company, as most CSR or sustainability departments do.

Thus, they can act as a real investor for impact, taking risks that a company cannot take – or is not willing to take. Corporate foundations can support and co-develop new innovative solutions to pressing social issues even when there is no market for these innovations yet (i.e. when they are not financially sustainable), or where the business benefit is not clear yet, even though the long-term potential to accelerate the sustainability of the company might be huge if the solution work.

This creates a big opportunity for companies to team up with corporate foundations, create a pipeline of social innovations, and generate a collective impact at scale. As Leslie Johnston, Executive Director of C&A Foundation says: “Corporate foundations – because of their ability to think big, take risks, and work for the public good – can be the compelling test beds for bold, new concepts to be scaled by the private sector“.

3. The importance of mutual strategic alignment

Only if the social ambitions of the company and the corporate foundation are aligned, can this partnership be truly leveraged to build a sustainable brand. If the company and the corporate foundation are dis-aligned, they run the risk of losing their credibility and potentially being accused of green or white washing. One way to align with the corporate foundation is to integrate the foundation’s social impact ambition with the company’s CSR agenda. This sends a strong signal about your commitment. At EVPA we are conducting an in-depth research on alignment, to help companies and corporate foundations find the best way to leverage each other assets and competencies to maximise social impact and drive sustainability. The research findings will be launched at the C Summit – the Corporate Philanthropy and Social Investing Summit in Munich on September 11 and 12. Come and join us!

Karoline Heitmann, Corporate Research Associate, EVPA

Priscilla Boiardi, Knowledge Centre and Policy Director, EVPA

Lonneke Roza, Senior Researcher, EVPA, Assistant Professor, Erasmus University

Steven Serneels, CEO, EVPA

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