Billionaire Richard Branson's Vision for Philanthropy (Might Rely Less on Nonprofits)
Richard Branson is the 286th richest person in the world, according to Forbes. Worth $5.4 billion, the 65-year-old founder of Virgin is also an accomplished philanthropist, founding nonprofit foundation Virgin Unite in 2004 and pledging to give away half his fortune to charity.
Branson has never been shy about sharing his philanthropic vision, discussing it often and in great detail. And he was at it again at last week's Coupa Inspire '16 conference, a gathering of spend-management professionals held in San Francisco.
But this time, during a wide-ranging Q&A session with Coupa CEO Rob Bernshteyn, Branson hinted at a new approach to his philanthropy—one that appears to rely less on the nonprofit sector and more on businesses. Via Diginomica:
The world, despite its problems—whether it’s Syria or whether it’s ISIS—every decade it’s getting better and better and better. Something like 600 million people coming out of poverty every decade.
In the past we’ve left it up to government and the social sector to try to achieve a lot of this. Business has done it indirectly but not directly. I think now, more and more businesspeople are adopting problems and saying, "OK, we’ve got our businesses, our business is very important, it’s making a big difference to the world doing what it’s doing, it’s making other companies more efficient, etc. But let’s use our entrepreneurial skills to adopt at least one problem in the world—it could be a local problem, it could be a national problem, or it could be an international problem."
I think if we can get every business in the world to do that, most of the problems in this world will be solved.
Let's qualify this a bit. Corporate social responsibility is by no means a new concept, though it is a growing one. And Branson, who supports or has supported at least 31 different charities outside of his work with Virgin Unite, doesn't seem to be saying that businesses will supplant nonprofits as leading social-change agents any time soon.
But his comments do appear to further the notion that the dynamic is changing. Where corporations would in the past partner with nonprofits to achieve social-responsibility goals, Branson is suggesting that businesses will soon—or should soon—evolve beyond those partnerships and take matters into their own hands.
We're already seeing this with the rise of the B Corporation. And it's an issue we discussed at length in our recent feature on corporate philanthropy:
“Nonprofits increasingly will face competition from for-profits for cause-related marketing dollars,” Nick Ellinger, vice president of strategic outreach for Mothers Against Drunk Driving, told us in January. “It used to be that the choice in charitable giving was between sponsorship and cause-related marketing, and if a for-profit had a nonprofit wing, it was a foundation set up to fund existing nonprofits. Increasingly, however, for-profit companies will see the benefit of setting up their own nonprofit arms—or quasi-nonprofit arms—to own a cause.”
In other words, corporations have figured out that they don’t necessarily need to partner with nonprofits to meet social responsibility goals. The stats bear this out. According to Giving in Numbers 2014, the number of companies providing pro bono service programs increased from 40 percent in 2012 to 51 percent in 2014. Ellinger cited AT&T’s “It Can Wait” distracted-driving campaign as an example. “They are doing many things a nonprofit would normally do—collecting petition signatures and pledges, distributing awareness materials, and providing programmatic tool-kits—without the nonprofit,” he explained.
As we said then, corporations doing more to solve the world's problems doesn't mean the sky is falling for nonprofits. The giving pie is an enormous one, and the scarcity mindset is as dangerous as it is flawed. But that Branson—one of the world's most influential business leaders and philanthropists—has acknowledged and encouraged the shift should be reason enough for nonprofits to start paying attention.
Change isn't on the way. It's already here.