On Corporate Social Responsibility

The Business Times (Singapore) today has a student article on "green funds".

Typically, two categories of green funds exist in the market. The difference between them lies in the way these funds select their stocks.

The first category takes the direct approach. Funds in this category are made up of companies that produce goods or services aimed at solving environmental problems. They normally invest in alternative energy, recycling and pollution control. For example, LSB Industries provides geothermal and water source heat pumps to multiple markets in the United States. Geothermal energy sources are environment-friendly alternatives to the burning of fossil fuels, a contributor to environmental pollution.

Funds in the second category take the ‘best-in-breed’ approach. These funds seek out various sectors or industries for their respective industry leaders in terms of employing environmentally-conscious business practices. Unlike funds that take the direct approach, funds in this category may invest in an oil company, for example, as long as it is considered the cleanest oil company of the lot."

 It’s a rather superficial article.

Environment-friendly investments can achieve two objectives. Investors will be injecting capital into companies that help slow down Earth’s degradation. Also, the more investments go into companies that engage in green practices, pressure is put on others to clean up their act in order to attract further investments. Therefore, by investing green, investors are also indirectly pressuring more companies to think about Mother Earth.

Have been looking into my bookmark folders and rediscovering links…

The New York Times covers the rise of "philanthropreneurs" - the new breed of successful businessmen who turn to profit-driven philanthropy:

""More and more people are asking who else is going to finance doing good if government isn’t," said Alan Abramson, director of the nonprofit sector and philanthropy program at the Aspen Institute, a public policy think tank in Washington. “These guys have firsthand knowledge of the market’s power, and they’re asking themselves why they can’t make money and tackle some of the problems once addressed primarily by government at the same time.”

It sounds simple, but the idea of such hybrid philanthropy is upsetting long-held conventions. These new philanthropists view the current foundation model, built on the fortunes of earlier industrial titans like Carnegie and Rockefeller, as hidebound and often ineffective. They have an urge to change the world, and argue that in some cases only the speed of capitalism is fast enough."

 Not all are impressed by Philanthrophy 2.0:

 "“I come at this from at least a wonderment of what are the advantages the melded or hybrid model brings,” said Mark Rosenman, a professor at the Union Institute and University in Cincinnati and an expert on nonprofit matters. “Though I have no problem with philanthropy and socially responsible business being joined, I do have one with a for-profit enterprise being called philanthropy.”

“I see no clear reasons to begin to develop corporate structures that need to consider themselves more closely aligned with philanthropic purposes,” Mr. Rosenman added."