« How bad is this credit crunch? | Main | Home Prices: Steepest Drop in 20 Years »

A few months ago, the NY Times ran an interesting article on hybrid non-profits run as as if they were true profit-maximizing ventures. It's being called the "Fourth Sector":

Composed of organizations driven by both social purpose and financial promise that fall somewhere between traditional companies and charities, the term "fourth sector" derives from the fact that participants are creating hybrid organizations distinct from those operating in the government, business and nonprofit sectors. But because the types of participants vary widely and much of the activity is nascent, no single name for what is occurring has gained broad use.

There are "for-profit" charities that are vying for donor dollars by engaging in non-traditional activities, such as adopting innovative investment strategies or owning outright ventures.

"There's a big movement out there that is not yet recognized as a movement," said R. Todd Johnson, a lawyer in San Francisco who is working to create an online wiki to engage in the give and take of information for what he calls "for-benefit corporations," another name for fourth-sector activities.

"Young M.B.A. students are not satisfied with going to work for a normal corporation because they are passionate to do good in the world and do it in business," Mr. Johnson said. "People of faith want exactly the same thing, and there is a whole generation of people who've become extraordinarily wealthy as a result of the technological revolution and are now asking themselves if they can create change in the world."

Even Wall Street is following this sector:

Goldman Sachs, the Wall Street investment bank, has a four-member research team that assesses the environmental, social and management performance of companies in the same way that more traditional colleagues analyze financial performance.

Goldman's efforts grew out of a report it produced in 2003 for the United Nations Environment Program Finance Initiative. It was asked to come up with ways to measure corporate response to issues ranging from gas emissions to employee health and safety practices and to determine how they related to the companies' financial performance.

To the firm's surprise, investors began asking for the report, which it had regarded as a one-time project, and requesting more of them. So far, Goldman has produced similar reports on the media, mining, steel and food and beverage industries. Each week, it sends out an e-mail message on sustainable investing to about 400 contacts at 80 institutions worldwide.

Perhaps we're witnessing an evolution here whereby business folks are merging their talents with a need to effect change - making the world a better place, while making money from it.

Read on...

Name (required)
Email
Website
Remember personal info? Yes   No
Comments

home | music | democracy | earth | money | projects | about | contact

Site design by Matthew Fries | © 2003-23 Consilience Productions. All Rights Reserved.
Consilience Productions, Inc. is a 501(c)(3) non-profit organization.
All contributions are fully tax deductible.