It's no easy task to live up to the "don't be evil" mission that Google (Nasdaq: GOOG) has embraced from the get-go. The difficulties inherent in living up to that mission while ensuring growth, which involves things like taking on the Chinese market, was one point I made in my commentary "10 Things I Hate About Google." The truth is, Google does have its heart in the right place, as its new philanthropic arm illustrates.
The New York Times reported on Google's plans for a for-profit charitable arm, under the google.org banner. It will start with $1 billion in seed money and fund companies that will target global warming, disease, and poverty. One of the first projects it plans to fund is a new, highly efficient hybrid engine that will run on ethanol, electricity, and gasoline -- hardly an unwelcome idea, considering the good fortune that car companies such as Toyota (NYSE: TM) and Honda have had with hybrid vehicles. Profits will be fed back into google.org, not Google's main business. The charitable arm will also have to pay taxes, unlike non-profit organizations.
It's hard not to like highly successful business leaders who turn some of their profits over to charity in an effort to combat some of society's ills. Such gestures also go a long way toward convincing capitalism's detractors that it's not all about greed.
Of course, some companies, such as Starbucks (Nasdaq: SBUX) and Whole Foods Market (Nasdaq: WFMI), have made certain socially responsible elements part of their missions -- and marketing. Meanwhile, consider other organizations' efforts that also merge social change and capitalism, such as eBay's (Nasdaq: EBAY) Pierre Omidyar and his Omidyar Network, which funds companies and organizations that will have "social impact." A spokeswoman from Omidyar Network explained to me that the mission-based investment firm emphasizes self-empowerment through for-profit businesses, not charitable contributions or non-profits. However, the innovations inherent in the companies and organizations it funds -- take micro-financing, for example -- fit the bill when it comes to individual empowerment and social progress. I first ran across information about that organization when I wrote about eBay's having taken a stake in the social-networking site Meetup last April, and I thought it was an interesting take on social responsibility and capitalism -- similar in spirit to Google's.
It's no secret to anyone that Google has some philanthropic elements to its mission. For example, it has always said it would earmark 1% of its stock and profits for philanthropy. Here and there, it's exerted its ability to help steward certain related themes -- for example, the green Google Maps mash-up it released this past summer.
Some might be tempted to wonder at times whether those guys from Google are crazy. They certainly tend to do things a bit differently from what many might expect. In this case, though, Google's plans may be unusual, but they're certainly not crazy, given that many people know it's not impossible for some businesses to deliver not only splendid returns to shareholders, but emotional dividends as well. Google has always made it clear that it wants to make the world a better place, so its shareholders shouldn't be surprised at the company's continuing efforts to operate not only profitably, but also philanthropically. Investors at large may find that other companies will start doing the same.
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Alyce Lomax
owns shares of Starbucks. The Motley Fool has a disclosure policy.
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