Headline: Companies See Benefits in Charity Efforts
Houston Chronicle, March 31, 2006
Charlotte Observer, March 31, 2006
Minneapolis Star-Tribune, March 31, 2006
By Dan Sewell

Associated Press Reporter Dan Sewell writes "Greg Allgood's job at Procter & Gamble Co. has taken him to remote, disease-plagued villages in Kenya, into some of the Western Hemisphere's poorest slums in Haiti, across rebel-ridden territory in Uganda and to tsunami-devastated Sri Lanka and earthquake-ravaged Pakistan."

While many who work for P&G sell consumer products such as toothpaste and diapers, Allgood is the director of the Children's Safe-Drinking Water Project. The program partners with Population Services International in an effort to curb the nearly two million child deaths attributed annually to unsafe water with a water-cleansing product called Pur.

Like other major U.S. companies with international interests, P&G sees long-range business benefits in charitable projects in developing countries, what some call "strategic philanthropy."

"We're not a for-loss company," Allgood said. But there is strong backing among P&G's leaders for the charitable project. "This is something we should do."

Sewell writes "Companies that work to improve health and education overseas also can improve their images in foreign countries and among consumers at home. They can reap benefits to employee morale and recruiting. And they can lay the groundwork in future markets."

"We're going into some of these countries where P&G has no presence," Allgood said. "And maybe it's 50 years from now when we have business in Haiti, but someday, we'll want to. What better way to learn the distribution infrastructures and government relationships than coming in with a product that's saving lives?"

A packet of Pur treats about 2.7 gallons of water, costs about 3.5 cents to produce, and is sold to consumers for around 10 cents. Partners can use some funds for their distribution costs, and commercial wholesalers and individual vendors in the countries can keep profits of 3 to 4 cents or more. This allows organizations to put extra money back into their efforts while providing a profit motive for individual vendors.

Sally Cowal, a former U.S. diplomat and now vice president at PSI, said a business-oriented approach is often more effective than outright donations because people attach more value to something they paid for.

‘‘By selling a product rather than giving it away, we can use the commercial sector instead of the public sector handout,’’ she said. ‘‘We sort of harness the profit motive and turn it into a social good.’’