What are the challenges and risks that organizations face when working with corporations?

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What are the challenges and risks that organizations face when working with corporations?

To help start the conversation and keep the focus of this discussion thread, please consider the following questions:

  • What are the challenges that organizations face when working with corporations?  Share experiences of the ways that these challenges were overcome.
  • What are the risks that organizations and practitioners face when working with corporations?
  • What are the limitations to working in partnership with corporations to improve human rights impact?

Share your experiences, thoughts, ideas and questions by adding a comment below or replying to existing comments!

Tensions between principles and impact


I am currently teaching a seminar entitled "Just Coffee" with the CEO of Peace Coffee, Lee Wallace. Just last week, we discussed tensions in the fair trade movement that has led Fair Trade USA to split from Fair Trade International. The tensions are exemplified by Fair Trade USA's "Fair Trade for All" campaign that expands certification requirements to include estate-grown coffee in addition to coffee produced by smallholder cooperatives. (See Global Exchange Fair Trade Blog for more detail).

Aiming to double its impact by 2015 through increased volume, Fair Trade USA relinquished a long-standing principle of the fair trade movement, supporting smallholder cooperative coffee farmers.

This illustrates one of the challenges of working with corporations (estate producers and by extension large coffee corporations), how to expand impact while holding to strong central principles related to human rights.

Are there other examples of tensions between principles and impact? What tactics can NGOs use in working with corporations to ensure the integrity of their mission? How far can an NGO go to work with a corporation before being co-opted in that work?

Do NGOs risk legitimacy by working w/ corps?

Fascinating dilemma, Mike - thanks for sharing.  I hope that others will be able to share their experiences and ideas with these challenges. 

I wanted to introduce another dilemma, or risk, that NGOs can face when working with corporations that your question made me think more about:

Mike Klein wrote:

How far can an NGO go to work with a corporation before being co-opted in that work?

Do NGOs risk their own legitimacy by working with corporations that continue to violate human rights standards?  Do unmet promises by corporations reflect poorly on the NGOs that work closely with these corporations?  Ignacio highlights the importance of independence between NGOs and corporations but I image that maintaining this independence can often be a challenge and pose a risk for this kind of work.  It would be great to hear the thoughts and experiences of practitioners working with corporations about these potential challenges and risks.

New types of risk or business as usual?

This is an interesting question - and one on which very little has so far been written.

There are certainly risks to partnering or otherwise collaborating with corporate actors. These can include:

  • Losing strategic focus: NGOs can be pulled into projects that may not be well aligned with their existing priorities, as e.g. defined in a strategic plan or agreements with donors, or which otherwise which may not speak to the areas of greatest need within their target constituencies of rights-holders, or which may simply not be truly human rights-based in their goals or approach, due to the availability of funding and a willing corporate partner.  Corporate funding may well have less strings attached, in terms of consistency with an NGOs´s own strategic plan or with national or local government strategies, and project planning, than funding from e.g international donors or larger foundations - which can increase both its appeal and the risk for NGOs that it may tempt them away from areas of strategic focus . From the business point of view, whereas up until now much "corporate giving" and funding for "community development" has lacked a robust basis, e.g. through linkage to local or national development plans, or via comprehensive mapping and surveying of local needs by appropriately qualified professionals, increasingly, in this aspect of their activities also corporations are being called on to "know and show", in the words of the former UN Special Rapporteur, John Ruggie, that they are human-rights compliant. So NGOs who raise these issues with potential corporate partners when approached, and see that a human rights-based approach is at the heart of any collaborative projects will be doing both themselves and the business partner a good turn.
  • Loss of control over communications. A critical point to establish with clarity at the outset of any partnership is how external communications will be handled (e.g. a requirement that any publicity, such as entries in the company´s annual sustainability report, or other communication with external stakeholders about the project, will be subject to agreement by both parties). Poor phrasing, inflated claims, use of images or names of project participants or beneficiaries, or mere inadvertent errors in publicity about joint projects can have serious negative consequences for the NGO, the project and the corporate partner, when these are picked up, as they will be, by other stakeholders, as well as jeopardising good faith in key project relationships. Better to avoid this risk from the outside by addressing this issue explicitly, in writing, from day one.
  • Loss of legitimacy. This is a particulary interesting point. Amongst human rights organisations, there are certainly some who feel that taking corporate coin compromises independence and integrity almost automatically. In some national contexts, where historically CSOs have been used as vehicles for corporations to channel funding to political activity, or as mechanisms of paying off and so dividing host communities, it is easy to understand why this should be the view. And this backdrop can put NGOs in a real dilemma - especially where funding from other sources may not be available.

I think the key here is transparency. Any NGO, CSO or non-profit that engages in corporate partnerships or accepts significant corporate donations must be fully transparent about the source, value and purpose to which corporate funds are applied. This means making such information available and accessible, e.g. by publishing on the organisation´s website and /or in annual reports and should extend to in-kind support  (e.g. funding for participation on corporate workshops or consultations) as well as programme specific funding.

 The commitment to transparency should moreover be embedded in an overarching governance framework to regulating the NGO-business relationship.  This should include definition of human rights based objectives for the collaboration, principles on external communications, as mentioned above, and, to protect both sides, might well include terms to address a process for resolving any disagreements, in the event it is envisaged that NGO and business cooperate in project implementation. Though comprehensive, such a framework need not be heavy : one approach is to devise general principles which can be supplemented with more specific terms on a per project bases(see e.g. DIHR´s Corporate Engagement Principles (http://www.humanrightsbusiness.org/corporate+engagement

One final point


One final point - and the reason I asked above whether in engaging with corporations NGOs encounter new types of risk: An interesting though exercise, in this context, is to reflect on what principles and standards NGOs as well as international agencies apply when engaging with government  or other public actors - or indeed with different social groups. What about activities with demobilised paramilitaries, engagement with communities where systematic abuses may be practiced with the sanction of social authorities, or projects in countries which may benefit their notoriously corrupt governments by allowing them to point to good deeds? Do these also entail a risk to NGO legitimacy? I would tend to think that risks to project- and NGOs´ own integrity are universal hazards that apply, and need to be acknowledged and addressed, whomever they engage with, public or private. But I would be interested to hear other views!

Maintain independence by not accepting corp funding

What do we do to retain our independence and legitimacy but continue working on improving human rights around the world? One clear line in working with corporations is keeping funding clean and clear away from corporations. Is it all about and only funding sources? Build and strengthen our own networks rather than links with corporations?

I don't like the word collaboration, it reminds me of term "collarabotionist" used to define those who worked for nacis during WWII. I don't think we should "collaborate" or even "work together" to prevent breing gradually taken over. But we have to "work with" corporation in order to achive our goals.

Challenge: lack of trust between NGOs and corporations

Naomi raised a great challenge in another discussion thread:

Naomi Kinsella wrote:

What I've found is that a lot of problems stem from a fundamental lack of trust between NGOs and corporations. The corporations think that the NGOs are a bunch of irrational troublemakers, and the NGOs think that corporations are motivated only by financial returns. A lot needs to be done to build trust between the two camps. This can only happen if corporations are more transparent and open to engagement with NGOS, and if NGOs maintain professional research and campaign standards---for example, by ensuring their research is sound before publishing the results of negative studies, and refraining from using emotive language in their campaigns.

Have you faced this kind of challenge - a lack of trust between NGOs and corporations?  How have you been able to overcome this challenge?  It would be great to hear from you!

Working with corporations

Do NGOs risk their own legitimacy by working with corporations that continue to violate human rights standards?  Do unmet promises by corporations reflect poorly on the NGOs that work closely with these corporations?

Of course. It is like working with any other individual. Respect is mandatory in any relation therefore violation of human rights standards is a violation of international laws set by the United Nations and these acts have to be reported. The problem may arise if the NGO does not inform the authorities about these violations. Nobody enters a partnership knowing that it will lead to such serious issues.


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