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Ben & Jerry's Homemade, Inc., the maker of "Vermont's Finest" super-premium ice cream, was one of the feel-good business success stories of the 1990s. In addition to introducing frozen dessert lovers to now-famous flavors such as Cherry Garcia and Chunky Monkey, the company trumpeted its ability to make money and do good in the world at the same time. It publicized its decisions to buy ingredients from local farms, its refusal to use milk produced with bovine growth hormone, and its commitment to contributing 7.5 percent of all pre-tax profits to an employee-led charitable foundation. As the founders wrote, "We wanted to create a company we could be proud of."
However, even one of the poster children of corporate social responsibility could not remain unblemished for long. In 2000, shareholders saw a chance to cash in when multinational food giant Unilever sought to buy out the quirky ice cream vendors. The founders, who had taken the company public to fund previous expansion, were powerless to stop the sale. Unilever's subsequent management quickly called into question whether market prerogatives and positive social transformation could indeed go hand-in-hand. Despite its vows to bolster Ben & Jerry's social mission and preserve local jobs, the corporation soon turned in the other direction. By 2004, it had closed factories in Vermont, laid off hundreds of employees, and scrapped a touted program to help minority-owned businesses. The British Guardian reported that, according to the company's 2004 social audit, fewer than half of employees "expressed confidence that Ben & Jerry's [would] continue to uphold its commitment to values." Ethical Consumer magazine lowered the company's "ethiscore" rating from 13 out of 20 down to 1.5. While the company still gives money to charity, it would seem that founder Ben Cohen was prescient when he expressed his fear shortly after the takeover that his company might "become just another brand like any other soulless, heartless, spiritless brand out there."
The Ben & Jerry's story is but a small cautionary tale about the still-growing and already far-reaching field of "philanthrocapitalism." This is the term that author Michael Edwards uses in his new book, Small Change: Why Business Won't Save the World, to describe a wide range of activities. It includes Silicon Valley CEOs using "venture philanthropy" to fund new, business-minded nonprofits; stock market traders developing socially weighted investment funds; bankers extending microcredit loans to the poor; and "social entrepreneurs" aiming to simultaneously serve a "double bottom line" of positive public impact and shareholder return.