Does Google.Org's announcement really represent a big change for the organization? Does it matter if the entity invests in non- or for-profits, and can it be successful doing both at once? Is it fair to criticize Google for taking a "business approach to philanthropy"?
Google.Org has announced a reorganization, in the wake of a review of its operations. According to Dr. Larry Brilliant's post yesterday on the Google.Org blog, he will move on from running the company's philanthropic arm to become Chief Philanthropy Evangelist, while Megan Smith, Vice President of New Business Development, will take responsibility for managing Google.Org (in addition to her current role).
While I'm intrigued by the leadership change (I've long believed there's a strong fit between business development, which is all about relationships with external actors, and strategic CSR, which is typically executed via partnerships), I'm most interested in the following piece of Brilliant's statement:
"During our review it became clear that while we have been able to support some remarkable non-profit organizations over the past three years, our greatest impact has come when we've attacked problems in ways that make the most of Google's strengths in technology and information; examples of this approach include Flu Trends, RechargeIT, Clean Energy 2030, and PowerMeter. By aligning Google.org more closely with Google as a whole, Megan will ensure that we're better able to build innovative, scalable technology and information solutions. As a first step, Google has decided to put even more engineers and technical talent to work on these issues and problems, resources which I have found to be extraordinary."
A New York Times article interpreted this announcement to mean that Brilliant "signaled that Google.org might curtail its financing of nonprofit groups unless they are closely aligned with Google projects" and said that the "announcement represents a shift in Google’s approach to philanthropy". I'm not sure I agree this is actually a major change. Of course, the reporter may have had access to information that I don't have, but the article indicates that no Google executives were willing to comment, so I'm assuming he came to that conclusion based only on the text of the blog post.
Instead, it sounds to me like Google.Org is continuing on with what it's always sought to do - utilize the company's unique assets to address social issues. Many companies have money (perhaps less right now), and this is certainly an asset they can deploy. However, they have unique access to their employees' skills, their products, and their proprietary technology and information. Anyone can give money, but Google is one of the very few entities that can, for instance, track flu outbreaks before they hit hospitals or help citizens visualize the impact of environmental disasters half a world away. I think Google has always tried to do this - I read this announcement as a reaffirmation of that goal, and perhaps an indication that the organization thinks it needs to do a better job of this, but I don't think this is a major change in how Google.Org does business.
I really don't care if the projects Google.Org invests in are for- or non-profit. It sounds like Google has found that, to date, the projects where it has made the biggest impact have been for-profit initiatives. I don't know if that's just been how it's happened to play out, or if Google is, for some reason, better equipped to make a difference via for-profit initiatives. It doesn't sound like the organization knows that, either - it sounds like its employees have just observed that, empirically, they've worked well with for-profits in the past. Going forward, Google.Org should certainly focus its activities on the initiatives where it expects to make the greatest impact.
The one red flag I do see here (if, in fact, Google.Org is considering moving more towards for-profit initiatives, as the New York Times article implies) is that it's easy to see an organization's tax status as a defining characteristic of that organization, and in many cases, this isn't the case. If Google.Org's goal is to earn a financial return while also having a positive impact, then of course they should focus their funding on for-profit initiatives. However, if their goal is to reinvent the energy infrastructure or change the way people in emerging markets access information (which may provide financial benefits to Google in the long run), I hope they focus on the operations of prospective partners, not their financing decisions.
That said, I'm not sure how easy it is to structure and staff an organization so that it is good at both for- and non-profit investing. In my experience as both a grantmaker directing funding to nonprofits and an MBA student evaluating prospective for-profit investments, I'd say that while the required skill sets are absolutely closely related, they're not identical. While the same person can certainly develop both skill-sets, the terrific grantmaker and the wonderful investor may not always be the same person. What organizations do both of these things well, and how are they structured and staffed to make this possible?
Getting back to the New York Times article, though, I was especially interested in these few lines:
"The company has drawn criticism for relying to much on a business approach to philanthropy and on a belief that engineering could be applied to solve the world’s problems.
'They are doubling down on the technocratic approach,' said Siva Vaidhyanathan, a professor of media studies and law at the University of Virginia, who is writing a book about Google. 'The habits and ideology of the company will lead the philanthropy rather than the needs of the communities or the planet.'"
I really take issue with the idea that someone would criticize the company for taking "a business approach to philanthropy" or for allowing "the habits and ideology of the company" to "lead the philanthropy". At the end of the day, Google is a company. The founders are very committed to using that company to making a positive difference in the world, and that's terrific. However, at the end of the day, they serve at the pleasure of the shareholders, and for Google.Org to be sustainable - for it to last through the many leadership changes that are sure to come in the future - it has to connect back not just to the "needs of the communities or the planet", but also to the needs of the company.
Furthermore, by taking a "business approach to philanthropy" and by using engineering "to solve the world's problems", Google.Org is utilizing its unique assets. I don't know whether Google thinks that engineering is the one true way to save the world - I think it's a little far-fetched to believe that anyone would think there's just one solution to the world's myriad problems. However, I completely agree that engineering (and the other skills offered by Google employees) are certainly the best way for Google to address social problems. As a result, I'm really glad that the company continues to integrate Google.Org into Google.