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Rotman Insights Hub | University of Toronto - Rotman School of Management

Friend or foe? Creating corporate/social movement partnerships that work

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Kate Odziemkowska

In 1990, McDonalds executives partnered with the non-profit Environmental Defense Fund to help the company reduce the amount of trash produced at its restaurants. The resulting collaboration eliminated 30 per cent of the waste produced by the fast food monolith’s practices, and the project represented a new paradigm for collaboration between a large corporation and a mission-driven environmental organization.

Three decades later, this kind of partnership has become more common, and many corporations are eager to show their support for the environmental movement. But when and why do these collaborations form? When do they work? And importantly, why do they fail? An award-winning paper from Rotman professor Kate Odziemkowska, which was recently published in Administrative Science Quarterly, set out to find out.  

Odziemkowska compiled a dataset of every interaction between 500 large U.S. companies and 136 U.S.-based environmental social movement organizations (SMOs) from 1988 to 2012. 

While the two types of organization clashed more than 1,800 times over environmental issues, not all of the relationships were purely contentious. Odziemkowska found that 357 partnerships — meaningful collaborations towards a mutual goal — had emerged between the disparate groups.

Odziemkowska found that successful relationships were most often found between business enterprises and moderate social movement organizations (those focused on reforming existing practices and systems), while partnerships with radical SMOs (those focused on creating new systems entirely) occurred less frequently.

And while one of the biggest barriers for partnership success is the risk of backlash among other social movement organizations, Odziemkowska’s research found that moderate SMOs that had strong relationships with radical organizations had more frequent and stronger collaborations with big business.

“If SMOs have board members that sit on each other's boards, if they’ve campaigned together in the past — that means they already have each other on speed dial,” she says. “It’s going to make broaching the subject of collaboration with a private enterprise a lot easier.”

Finally, SMOs that specialize in collaborating with businesses were less likely to suffer negative consequences — think of the B Lab, which certifies corporations as environmentally and socially responsible. Because these organizations bake collaboration into their mission and strategy, their contemporaries expect them to form partnerships.

“The more an organization specializes in collaboration, the less threatening it is to its peers,” Odziemkowska says. “You’re not muddying the waters between boycotts and protests on the one hand and collaboration on the other.”

Collaborations do come with risks to both sides. In most cases, firms must disclose information about their practices to their prospective SMO partner.

“The one big risk for firms is opening themselves up literally,” Odziemkowska explains. “These processes often mean opening doors, opening documents and opening processes to organizations that are part of movements that are quite critical of big companies.”

The risks of collaboration are even greater for an SMO. These organizations are often founded on grassroots organizing and charitable donations. If a partnership damages an SMO’s reputation, it may lose favor with its constituents. 

“After the B.P. oil spill in 2010, the organizations that collaborated with B.P. — or any oil and gas firm for that matter — saw their donations drop by more than 50 per cent,” Odziemkowska says, referencing a 2021 paper that she co-authored.

Yet crises may spurn action. Data shows that many firms wait until after they have been targeted by the environmental movement to seek out collaborations. But, in a catch-22, being targeted makes it more difficult to find a willing SMO partner, Odziemkowska says. “It’s one of the big mistakes that companies make. Don’t wait to be targeted.”

Though relationships between large corporations and SMOs face many obstacles, they can have a big impact. In the case of McDonalds and the Environmental Defense Fund, that impact could be weighed in tons of trash that never made it to the landfill.

But some benefits are more difficult to measure. Odziemkowska says that collaborations, more than protests and boycotts, can be an effective tool for changing corporate mindsets.

“You’re opening doors, you’re being transparent with what you do, and you’re working together,” she says. “It’s an incredible learning opportunity.”

 


Kate Odziemkowska is an assistant professor at the Rotman School of Management