Should Charities Accept Donations from Gaming Companies?

 In Collaboration, Corporate Social Responsibility, Creating Shared Value, Leadership

Gaming companies represent a minefield for charities accepting donations or fundraising support from them. Allegations of money laundering against a well known brand in Australia has brought this issue to the fore.

What’s the problem?

With the social costs of gaming in the state of Victoria alone estimated to be $7 billion per annum, it is a problematic industry for a charity to be associated with. If gaming companies are knowingly (or unknowingly) helping organised crime syndicates launder money, then relationships will be strained even further.

Crown Resorts supports many charitable causes by hosting fundraising events and supplying staff volunteers. Those charities will be increasingly uncomfortable being associated with their name. A mental health and suicide support organisation told me they’d previously turned down offers of support from Crown because their activities exacerbate the problems they deal with.

Doing a bit of ‘social good’ on the side doesn’t make up for the more serious problems embedded in a company’s core operations.

The tension between profit and purpose

In the US, the family shareholders of the company making the opioid, OxyContin, has supported museums and art galleries around the world. Some of those recipients are now returning monies as law suits alleging misconduct and serious social harm are brought against the company.

This and similar situations raise more questions than answers, such as:

  • Where to draw the line in deciding if a company is good or bad?
  • Can any company hope to meet every ethical standard we might impose on it?
  • If one charity refuses to be involved with a gaming company then is it okay for another to accept?
  • How does government balance income from gaming royalties with social costs that come with it?
  • How do we better understand the harm companies do in the normal course of operating?

Guidance for CEOs and Directors

For charities associated with such companies, there needs to be some serious questioning of alignment: does the mission of your charity conflict with the negative impacts of your corporate sponsors? You’d also want to weigh up how your supporters will perceive the association and to what extent it will damage your brand? And the level of significance and materiality is another overriding consideration.

What can you do?

If you support a charity and you’re not sure about the donors or sponsors associated with it, I’d urge you not pull your support nor attack them on social media. The people running these organisations face insurmountable challenges every day and the best thing you can do is engage rather than disengage.

I’m sure they’d value hearing about your concerns and charting a course forwards. The bottom line is that they’ll need to weigh up the financial and social impacts very carefully.

Phil Preston is a collaboration expert. You can stay in touch by following him on Linked Incontacting him directly or using the form below to opt in to occasional emails.

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