Is the sector ready for the challenge from companies?

Corporates are muscling in on activities and values traditionally seen as the exclusive preserve of charities. Mathew Little assesses the threat and looks at the ways in which charities are responding.

A protest at the European Parliament
A protest at the European Parliament

In December 2006, an anonymous white truck parked outside the European Parliament in Strasbourg, France. In front of the helpless attendant policemen, the truck's occupants then dumped a load of horse manure on the pavement before unveiling a banner that read "45,000,000 Animals Are Sh**ting Themselves Over REACH". The protest was against proposed legislation on the use of chemicals that it was feared would lead to an increase in animal experiments.

As a stunt it was nothing new. Greenpeace dumped tonnes of coal and GM soya outside the gates of Downing Street in 2005 in separate protests. The comic touch was also a familiar trademark of modern campaigning. What made the protest unique was that the perpetrators were not from a charity or an NGO. They were from a company - natural cosmetics retailer Lush.

Lush is one of the business success stories of recent years. In little more than a decade, it has grown from a solitary store in the UK to more than 400 shops across Europe, America and Asia.

The company has always had strong ethical principles: it has a policy of not buying from companies that test ingredients on animals, has an aversion to packaging and has funded radical campaigning groups such as Plane Stupid. But in the past two years it has decided to move into territory that was previously the preserve of non-profits: seeking to influence public policy directly.

"Lush is by no means a perfect company, but in the areas we believe we are really good on, we feel we can go a step further," says Andrew Butler, head of campaigns at Lush. "We know our animal testing policy is right, and we know we can take that to the wider world."

Proposed EU legislation on the registration, evaluation and authorisation of chemicals, known as Reach, was the reason for the protest. Lush took action because no NGOs were campaigning publicly on the issue. The company asked customers in its European stores to send postcards to MEPs urging them to change the legislation - about 88,000 customers did so. To push the point home, Lush took direct action.

"Nobody else was fighting the Reach legislation," says Hilary Jones, director of ethics at Lush. "We went round animal groups and political parties to see if anybody had spotted that the legislation was fundamentally flawed, that it contradicted the cosmetics testing legislation and nobody was doing anything. We took it straight to our customers because public opinion is the most powerful tool out there."

Lush has picked up the mantle of corporate campaigning from The Body Shop, another retailer of ethically produced cosmetics. Mark Constantine, the founder of Lush, was one of The Body Shop's original suppliers. When The Body Shop was taken over by L'Oreal in 2006, Lush stepped up and filled that gap, says Butler.

It might be significant that Lush is privately owned and is therefore able to follow the principles of its owners without the constraint of having to meet the short-term goals of shareholders. But even corporations that are obliged to maximise shareholder value are beginning to campaign - and for business reasons.

"Companies have realised that the brand values of the third sector - those of solidarity and generosity - are actually very good for selling products," says Jon Duschinsky, director of French fundraising agency Ressources Non-Profit. "And they've realised this quicker than we have."

In 2000, US ice cream producer Ben & Jerry's was acquired by the multinational umbrella company Unilever. Ben & Jerry's had built a reputation for social activism and there were fears that the takeover would spell the end of its campaigning activities. Under Unilever's ownership, however, the brand has continued its American Pie campaign, which calls on the US government to reduce federal spending on nuclear weapons and devote more resources to lifting children out of poverty.

Unilever has also initiated campaigns that have unashamedly aped the awareness-changing activities of non-profit organisations. Dove, a Unilever company, is now synonymous with its Campaign for Real Beauty, which attempts to combat damaging ideals of female beauty in the media.

Besides encouraging women to take part in its billboard advertising, Dove has launched Beyond Stereotypes, an NGO-style report surveying the impact of beauty ideals on female self-esteem in 10 countries. "Dove has made a huge impact by positioning itself as a charity and deliberately blurring the line between for-profit and not-for-profit," says Duschinsky.

Dove's campaign has attracted criticism. Activists in the US have accused Unilever of hypocrisy by marketing another brand, Lynx body spray, using a fictitious lingerie-clad female rock band. But the campaign makes good business sense. According to Patrick Cescau, chief executive of Unilever, Dove executives "realised that by championing the cause they would not only be doing something worthwhile, but at the same time strengthening the loyalty of their customers to the brand. We are reaping the benefits of this in rapid rates of growth for Dove all around the world."

Cescau says Dove did not formulate the Campaign for Real Beauty because of pressure from NGOs or governments, but because of market research into the desires of consumers. "They want brands that not only make them feel good and look good, but also do good," he told a conference on sustainable development in May last year.

Charities and NGOs might feel uncomfortable at the sight of a multinational corporation co-opting the campaigning techniques and values of the not-for-profit sector, but they are likely to worry about the fact that Dove has started fundraising on the back of its Real Beauty campaign. The company asks for donations for a 'self-esteem fund', which gives money to the Eating Disorders Association in the UK.

Other firms are also beginning to fundraise directly. Another cosmetics company, Avon, has raised more than £750,000 for breast cancer projects in the Ukraine, and UK supermarket chains Sainsbury's and Tesco have both established direct fundraising relationships with their customers through their Active Kids and Computers for Schools initiatives.

Charities face competition from companies with vastly superior marketing budgets that start to see campaigning on social issues as a profitable way of connecting with their customers. Those same firms could also cut out the charitable middle man and fundraise directly for their chosen beneficiaries.

"We are going to have to face up to the fact that we've lived in our own little world for a long time," says Duschinsky. "We have got to the point where the world has decided that what we do is profitable, and it's going to try to grab a piece of it."

How much the corporate sector is able to grab will depend on how charities react. According to Duschinsky, the third sector will have to become more business-like to survive. "This trend is going to help charities rationalise," he says. "People don't embrace change unless they have to, and they will have to soon. If we are to stay ahead of the Doves and the Unilevers, we will need to double our efforts in terms of creativity and innovation."

Looking at Lush

Cosmetics firm Lush's three-year campaign to amend EU Reach legislation on the use of chemicals to prevent widespread animal experimentation is not the first campaign the firm has launched. In the Netherlands, Lush has joined forces with anti-fur groups to support legislation before the Dutch Parliament to ban mink farming. In the UK, the company is collaborating with medical research charity the Dr Hadwen Trust to support the revision of an EU directive in order to ensure alternatives to animal experiments are used where possible. A petition supporting the change is being promoted in Lush stores.

The company also funds campaigning groups including Plane Stupid and Guerilla Gardeners, using its charitable fund.

According to Andrew Butler, head of campaigns at Lush, the company does not want to replace charities as campaigners. "When we approach NGOs and environmental groups, it's really to see what we can do for them, rather than what they can do for us," he says. "It's not a question of trying to compete with non-profits. We want to give them a new tool to use."

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