How corporate social responsibility could boost black-owned businesses

Political preferences aside, most people would agree that it is incumbent upon corporations to exhibit some measure of social consciousness and good citizenship within their communities.

In response to this popular sentiment, corporations often engage in corporate social responsibility (CSR) initiatives to endear themselves to targeted communities or demographics. In Madison, CSR initiatives typically take the form of corporations supplying financial resources for nonprofit institutions.

The feel-good nature of CSR initiatives makes it nearly taboo to ever question the economics of the marriage between local corporations and nonprofits. Yet if Madison has any hope of rehabilitating its reputation when it comes to the economic disempowerment of black communities, then we must be willing to explore whether a more robust form of CSR could better facilitate racial equity.

Let’s assume, for the sake of argument, that most corporations are sincere when it comes to their CSR campaigns and that they are genuinely interested in promoting the social welfare of disadvantaged demographics. As memorialized in the Race to Equity Report, perhaps our most pressing social welfare issue is the need for racial equity — particularly the need to provide equal educational and economic development opportunities to black Madisonians.

Consequently, many corporations have narrowly focused their CSR initiatives on providing financial assistance to nonprofits that deliver workforce development and academic enrichment services to predominantly black communities. I cannot stress enough the importance of funding and delivering these forms of developmental services. However, because this CSR model does not include initiatives that target the financial development of black-owned businesses, our business sector is missing an opportunity to empower the people who are best suited to empowering the most disadvantaged Madisonians.



We often hear of the grim outlook for many black workers in Madison who are either wage earners or unemployed. But what we rarely hear about are the depressing prospects for the development and sustainability of black-owned businesses in Madison. For most black-owned businesses, Madison is a revolving door of grand openings and grand closings.

Black-owned businesses in Madison tend to never quite reach developmental benchmarks that would lead to engagement in hiring and CSR initiatives. Anecdotally, I think it’s safe to assume that black-owned businesses are more likely to a) hire black employees and b) reinvest in the financial development of nonprofits that serve predominantly black communities. However, if black-owned businesses are not financially empowered to help grow the local economy, then it is difficult to believe that our city can succeed in eliminating the disparities in opportunities facing black children and working adults in Madison.

So what does the development of black-owned businesses have to do with local corporations and their CSR initiatives? Local corporations that are sincerely interested in the social welfare of black communities in Madison can vastly improve the impact of their CSR initiatives simply by investing in the empowerment of black-owned businesses.

In addition to maintaining financial contributions to nonprofit service providers, local corporations should also review their business-to-business portfolios for opportunities to work with black-owned vendors and contractors. In essence, this new type of CSR initiative could resemble the public sector’s (imperfect) approach to opening up procurement opportunities to minority-owned businesses. Whether the vendor opportunities are for catering, insurance, or other services and/or products, local corporations should commit to starting somewhere.

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