AmazonSmile Turned Upside Down Cutting $449m CSR Program (news)

Amazon Sunsets AmazonSmile Amid Cost-Cutting 

The AmazonSmile will be ending by February 20th, according to a statement from the company, as reported by NPR and others. While the program dispersed nearly $449 million to nonprofits globally, the company says that the donations were spread too thin, minimizing impact. Amazon pointed to other efforts, such as its Housing Equity Fund, which supports affordable housing efforts near its headquarters, as an example of a social impact program receiving investment. However, smaller nonprofits that received AmazonSmile donations say that the donation were helpful and would be missed. The move comes after Amazon announced 18,000 layoffs, amid a winter defined by tech layoffs across the industry.

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Rough Transcript

[00:00:00] George: This week on the nonprofit news feed. Well, we are talking about turning that Amazon smile upside down. I was first off, really happy to be able to come up with that subject line. Um, not as happy that this program is ending. Uh, Nick, how’s it going?

[00:00:42] Nick: It’s going good. George, this is, I think, gonna be one of those weeks where we are just focused on, on one-liners and, and puns. But alas, I’ll take us into the top story, which you alluded to, which is that Amazon Smile. The program that donated a PORs, uh, portion of the proceeds from purchases on Amazon to nonprofits will be coming to a close on February 20th.

[00:01:07] This comes via reporting from NPR and other outlets. And in the history of the program, it dispersed nearly 449 million to nonprofits globally. However, the company says that the donations were spread too thin, minimizing impact. That’s in quotes. Um, Amazon pointed in their statement to other efforts such as its Housing equity fund to support affordable housing.

[00:01:34] Here its headquarters as an example. Of a social impact program it was investing in. However, in the articles, smaller nonprofits said that Amazon SMILE donations were helpful and would be missed. And this comes amid broader economic headwinds that the industry is facing. Amazon has announced 18,000 layoffs.

[00:01:57] Tech layoffs are now commonplace across the board. Amazon Smile more like a frown these days.

[00:02:06] George: I’m sad to see a CSR corporate social responsibility program of this magnitude get sunset in this way in short order. I’ve been looking on LinkedIn, um, the reactions, and some folks are saying, you know, good riddens, this was a distraction for nonprofits because it sort of baits an organization into becoming an affiliate marketer.

[00:02:30] Meaning you get a portion of the sales based on a trackable link and you’re pushing product as opposed to your purpose. , I hear that. I also see 449 million, uh, across nonprofits being something meaningful now. Yeah. You spread peanut butter too thin and it turns into nothing. Right. If I were to donate that, but like, that’s still just, that’s a lot of money.

[00:02:55] You know, there’s, um, 1.5 ish million nonprofits, so I don’t, I don’t know that I buy that full narrative of like, it was too small to make a difference. , it was part of, for some organizations, a balanced fiscal diet. It was a diversification of revenue streams. You know, it was something that they, they got and ideally didn’t have to push too hard for.

[00:03:19] So bad thing too bad. You know, I, I, I don’t think that, I’m curious why, and, and I’ll maybe never know the reason of like the actual, like, is this a cost cutting? Is there just a change in csr? Did they not get enough, uh, from it? Because on the same token, it actually served them as well because guess what?

[00:03:42] Somebody was buying something from them. You know, it was the affiliate marketing strategy. It was actually pretty darn clever, and it worked so sad to see it. And hopefully there’ll be a, another solution that arises, an opportunity that shows up for, for those organizations.

[00:04:02] Nick: I agree. I. It can’t have cost them that much money to run though. Like that’s the thing, right.

[00:04:11] George: Well, the the other thing is like you can just sign up for an affiliate link and sell things, but I think the difference also with Amazon Smile is that, You could have your supporters put Amazon Smile on their purchasing. So I had it for, for my nonprofit, and it was just, anytime I buy, I had something on Amazon.

[00:04:27] A point went that way. So I, I, maybe you need to backtrack on like affiliate marketing versus actually it was adding a layer that said, for these customers, a portion of your proceeds go back to this organization. So that is uniquely different.

[00:04:43] Nick: That’s fair. That’s fair. We’ll continue to see if we hear more about this, maybe they’ll roll out something different or new. Alas, we move along to our next story, and this one is from a ABC News and others that the Times Up organization, the Me Too, the organization born out of the Me Too movement, particularly the that one in Hollywood, um, has Hal.

[00:05:13] Operations and is shifting remaining financial resources to the Legal Defense fund. So Times Out has had a. Go of it. Fallout from associations with Andrew Cuomo and that scandal, um, and has been something of an EM battered, uh, embattled organization rather, um, over the past couple years and is now closing doors and, and shifting that money to the legal defense fund, which does, uh, provide, uh, resources for women in, in specific industries. This is kind of a weird one because it’s such a high profile organization that came up very quickly. I think there’s probably some lessons to be learned here. George, what are those lessons and what is your take on this?

[00:06:03] George: I wish I was smart enough to actually understand the, the full implications of of this. The different narratives that I see here, one, are the types of organizations that pop up in these. Cultural moments have a lot of headwinds. Later they start off with a disproportionate amount of attention and funding upfront, which certainly times updated and they did remarkable work, certainly around if we’re looking at victims of Harvey Weinstein, and then the way that they were able to, I’d say, update the way that victims were dealt with.

[00:06:44] In these cases from a legal standpoint and a lot of achievements there, but there’s a certain type of what feels like immutable. What goes up must come down type of physics here, where the speed at which with which you rise to fame. also seems to all but guarantee the fall from Grace. That is kind of like the inverse Lindy effect.

[00:07:15] The Lindy effect is if you have been here for this long, you’ll probably continue to be here. Uh, coming from the. Run of show for Broadway, uh, productions that if a Broadway production had been on, you know, it’s a, it’s a wonder that cats ever stopped being on Broadway. Cause cats had been forever on Broadway.

[00:07:32] And it was this, this joke of like, once you’re in the line cafe, you’ll sort of never be removed. Um, I’ve gone far from the topic, I’m gonna come back to it. So the first thought, the speed with which something rises probably dictates the speed with which it falls the next. Looking at organizations that need to sort of spin up with all of the overhead, with all of the infrastructure and hiring staffing, like to create a new organization takes a lot of, of work and wealth.

[00:08:08] And the fact that now at the end of it, you know, they, they talk about, and even in this quote, very simply, the Legal defense Fund really reflects who we were, not only at our inception, but really at our core. And that’s a quote from, uh, Schultzer. And that’s why, you know, the, the remaining 1.7 million, which is, is quite small, uh, in the grand scheme of the size of the organization, uh, is going back to that fund.

[00:08:33] And the question I guess in my mind is, you know, the fund administered by the National Women’s Law Center in Washington? Which has provided and provides legal administration help to, to workers that identify as low income and 40% of people of color. I, I’m, I’m curious as to what the world would’ve looked like, had times Up simply been a branch of that organization, how much more could have been applied to it and the, the learnings and the staff and that ability rolled into an existing organization rather than saying, we need a new organization.

[00:09:08] You know, could this have. A campaign or a program of that legal defense fund. Those are just questions in my mind, and it’s, it’s tough with an organization under this level of scrutiny. I, I have a hard time getting behind some of those decisions they made with, you know, Andrew, Andrew Cuomo and, and consulting, allegedly consulting with them behind closed doors that was then later revealed by reports.

[00:09:33] Uh, It’s tough. I think nonprofits are under, uh, a much, much greater microscope and it doesn’t take much to set the, set the tide in the wrong direction because you exist at the public’s. Will you rely on funding and funders and if those funders are then effectively being shown. as public donors because nine 90 s are all public.

[00:09:59] We can see donors and donations. Are you then saying, oh, a large donor has to then reconsider like, wait a minute, am I supporting an organization that supported Andrew Cuomo? Not saying that that is a direct line, but all things being equal, it doesn’t take much to hurt in that reputation, and it’s tough for organizations that are in that frontline type of work.

[00:10:17] Nick: George, I, I think that’s, that’s a great point. You bring up a lot of different nuances and the threads there, and it makes me think that your nonprofits have to play by different rules than businesses, right.

[00:10:33] George: They do. You can’t just go on an apology tour being like, Hey, sorry, we fired him. We’re all back to normal. Like, nevermind that our news station. Maybe let this kind of go by the wayside.

[00:10:44] Nick: Yeah. Yeah. Um. Yeah, I guess we’ll, we’ll continue to keep an eye on this story. It’ll be interesting to see how that legal defense portion of it, which is still administered by, um, that, uh, the other organization, the, the woman’s um, uh, legal organization, how that all pans out. Um, so we’ll keep our listeners updated, but to that end, I will take us to our next story.

[00:11:12] And this one comes. From King and the founder of a Seattle West African immigrant nonprofit is accused of embezzling millions. Um, so. Uh, the, the gentleman in, in question, Issa I apologize cause I know I’m mispronouncing. That was the founder and longtime executive director of the West African Community Council or W A C C, which is based in Seattle.

[00:11:44] Um, and after decade of service, um, he was ousted, uh, on December 16th. Accused of embezzling, which is, which is, you know, terrible, terrible, um, especially, you know, people who really, really need help. And then this long article kind of goes into it, it goes into, uh, in DA’s started of the story, um, as well side of the story rather, and it kind of a complicated one.

[00:12:11] But, uh, George, what’s your takeaway on.

[00:12:16] George: I look. Board members for this, and this is a reminder for the fiscal responsibilities that your board members take on. And I’m not saying send this article to your board members, but if you are on a board, if you are building a board, fiscal stewardship and hiring and firing the c e o, those the primary jobs and roles of a board.

[00:12:38] And so I see this and I don’t look at, you know, in the D and say, oh, what a bad actor. Like there are bad actors. One out of a thousand people, one out of 10,000 people are not the, you know, folks that you should be trusting. The job of the board is to hire and fire and make sure the right people are in there.

[00:12:56] And the fact that this was an extra bank account started in 2014, like a secret bank account, and like hundreds of thousands of dollars going through there, you know, I’m looking at auditors, I’m looking at board members looking at that, and so paying attention to those things like, oh, it can’t happen. . Um, it, it is just a function of odds and, uh, again, I wouldn’t have put this in here actually if it had not been for the size of the, the embezzlement.

[00:13:25] We have millions of dollars. It’s, it’s brutal. Uh, so it’s a reminder to, to board members out there that, uh, while those finance meetings may be boring, and also the people preparing them, like, here’s, here’s what you’re actually doing. Um, you’re making sure money gets to the. The right places and you’re avoiding, um, tragedies like.

[00:13:45] Nick: Absolutely. I think that’s a fantastic point and we always like to keep our listeners on their toes to protect themselves from this happening at their organization. I have our next story is an interesting one. Um, Georgia. Did you know that IKEA is owned by a nonprofit?

[00:14:11] George: Here’s the thing. I didn’t know that Ike. Was owned by a nonprofit. Frankly, this is like a non-story story, but it’s fascinating because, uh, you know, in the , the rep reputable, the US Sun , and this title says no Ikea, uh, people are only just realizing what happens to the money IKEA makes, and it’s blowing their minds.

[00:14:32] I mean, first off, a plus on a hook title. But it’s funny because there is a nonprofit involved and owner of the main entity. So IKEA is actually a nonprofit organization. So the money made from those, uh, you know, fund to assemble wardrobes, uh, you know, beyond paying is, is put away into, um, a nonprofit. And the charity’s big mission is to further the advancement of interior design.

[00:15:01] Nick: Novo, Novo.

[00:15:03] George: uh, They’re putting it out there further, the advancement of interior design. I mean, you’ve gotta believe in that mission, I suppose. Um, I did. I didn’t have anything else here. Just I thought it was funny.

[00:15:17] Nick: it’s really funny. So the detail is I e Ikea store stores are franchised by a company called, Inga Holdings, which is fully owned by a nonprofit organization called Stitching Inga Foundation. Um, yeah, I , it’s kind of funny. I wanna do a deep dive on this. We need like a little mini documentary on what the hell’s happening, but.

[00:15:45] Uh, I am willing to bet there is some criticism in the wonderful Scandinavian world about, uh, whether this is truly because people are passionate about, um, easy to assemble interior design pieces, or whether this is some kind of, uh, super duper clever, uh, tax loophole that is being taken advantage of.

[00:16:09] George: Yeah, I mean, look, there’s some definitive, like this is a tax play very clearly. They pay according to online mba, 33 times less taxes than the average business. The Economist, the overall setup of IKEA minimizes taxes and disclosure handsomely, rewards the founding camra Cam Prad family, and makes IKEA immune to takeover.

[00:16:32] So it’s interesting. That when you’re saying like, this is a strategic reason, like frankly as a business owner, now you have me thinking, should a nonprofit own whole whale and suddenly we don’t have to pay taxes. We have, I’m gonna go ahead and say a loftier mission then to improve, I’m sorry, I want to get it accurately to, uh, to further advance, uh, the advancement of interior.

[00:17:00] Further the advancement of interior design. So I would say ours has built a healthier, more just and sustainable world as an agency. I, uh, I don’t know. One of the funnier quotes here is, uh, no wonder why you gotta put everything together yourself at Al Okaya, because they rely on a bunch of volunteers to put their stuff together.

[00:17:20] So, you know, they have a lot of volun, big volun. I have volunteered for Ikea on more than one occasion,

[00:17:29] Nick: Volunteering on for IKEA is a, a family pastime. Um, That’s funny. Here’s another one for you, another light story. We’re, this is a good week. There’s nothing too traumatic in

[00:17:42] George: I mean, just, you know, massive embezzlement, half a billion dollars of CSR stopping at Amazon. This is a good week,

[00:17:49] Nick: Yeah, this is,

[00:17:50] George: on

[00:17:51] Nick: this is a good week for

[00:17:53] George: this. Okay, you’re classifying Good week on this. Okay.

[00:17:55] Nick: I, you know, maybe it’s just because it’s sunny out. But that is a perfect segue into our next story, where one New Jersey school asked What if school was outside all the time? Every day. So New Jersey Nature schools are taking class outdoors, rain or shine. Um, and this article talks about bundled up kindergarten students at a Star Child Nature School in Medford, New Jersey, outside collecting tree sap to make glue.

[00:18:28] Four handmade ornaments. So this is an immersive, you are outside, you are learning, you are one with nature type situation at this school. And that brings us to, uh, the relevant question of making, uh, the question of nature versus nurture ever. The more salient.

[00:18:46] George: Wow. It’s, it’s all, it’s all nature school here. Uh, and I know some are nonprofits, some are for-profits, but there’s a number of them, and I’ll call out one quote here From the South Mountain Nature School, our programs promote social and emotional development and instill confidence and foster independence.

[00:19:01] Said Mary Claire Solomon. Who also in other news happens to be my sister. And so I’m incredibly proud of my sister for starting one of these nature schools, pushing through the pandemic and growing to the size that they have, uh, in New Jersey. And, you know, I get to see the, the pictures and the approach that they take in.

[00:19:23] There’s, you know, that question that comes up, well, what about when it snows? And it’s like, you know, there’s no bad weather, just bad apparel. So they, they are out there, rain or shine. I think this is a, a really healthy way for, for young people who are inevitably going to wander into the world of screen first learning and engagement and work to realize that, you know, food comes from the ground.

[00:19:52] SAP is fun and it’s, uh, it’s great to see. I’m very proud of my sister, though. In other news,

[00:20:00] Nick: That’s super. George did you know that’s mine, hometown, A South Mountain Reservations with in walking distance from where I grew up.

[00:20:07] George: He can go over and say hi.

[00:20:09] Nick: Go over, say hi. Maybe a little too old for, uh, the Nature School thing,

[00:20:14] George: you could volunteer perhaps.

[00:20:17] Nick: love it. All right. How about a feel good story?

[00:20:21] George: Yeah. What do we.

[00:20:22] Nick: This one comes from the Philadelphia Inquirer, uh, and it’s about the eagle. The team, not the group, uh, thought that their Christmas album would fund a toy drive and it ended up doing so much more. So the Philadelphia Eagles of a football and. Sports fame can tell.

[00:20:44] I follow football. Uh, thought that they were just raising a mere $30,000, um, for this charity toy drive, when in fact they raised

[00:20:59] George: Quarter million 250,000 I believe.

[00:21:02] Nick: million. Wow. Wow. Good for.

[00:21:07] George: Yeah. What it’s nice is also going to be funding not just one, but two toy drives and a summer camp, uh, which. Objectively I, while I respect toy drives and I like those moments, it’s great to also say, what about dealing with, uh, the summer learning gap and supporting communities when, um, when you are needing a potentially even more.

[00:21:29] So, uh, congratulations. Also, full disclosure here. Nick thought that this wasn’t the team, the Eagles, but the band, uh, the Eagles. And it took him a couple of reads to realize that it was a fact about the sports ball. So Nick, I think we all learned something today.

[00:21:49] Nick: We’ve learned a lot.

[00:21:51] George: Have we, well, before I give you a terrible joke, I have a bit of a sponsored post here and it. A note that we are opening up our, as far as I know, we only do it once a year and it’s the ad grant cohort and we’re teaching. Organizations how to run the ad grant, the Google Ad grant, the thing that you get 10 K a month in in-kind ads for placing ads that drive traffic and value to your organization.

[00:22:20] We’re doing a five week live cohort. This isn’t pre-recorded. This is hands-on and we’re sharing exactly how we run this ad grant to maximize the ROI for your organization. And so we’re gonna help, uh, only I think it’s limited, 25 organizations. It always sells out. Registration is now open. Uh, and you can find that link in the show notes or wander around whole and you’ll find it there.

[00:22:47] Alrighty, question Nick, for you.

[00:22:52] Nick: Uh oh.

[00:22:53] George: Why, why did the clown donate his salary?

[00:22:57] Nick: Hmm. I don’t know about the clown thing, but why did the clown donate his salary?

[00:23:02] George: Uh, it was a nice gesture.

[00:23:05] Nick: Ah, ah, ah.

[00:23:09] George: He, he laughs sometimes he doesn’t know. And then we like, go off, Nick, did you actually get this one or is this gonna be the one where you like pause and you’re like, I didn’t get it. Explain it to

[00:23:17] Nick: I, I got this one. I’m a huge Shakespeare Stan. I, I’m very familiar with a court gesture and this was, yes, but offering to explain was as well a nice gesture. Um, cuz

[00:23:30] George: I just wanted to do it cause I feel like I cut off. I’m like, this would’ve been much funnier if he didn’t understand it. He was like, I laugh, I don’t get it. Alright. Thanks for humoring me and this is what you get for staying to the end of the podcast. Leave us a review. Thank you. Bye.

[00:23:46] Nick: Bye.