Who’s Watching the Watchdogs?

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Public interest groups need more scrutiny. So a forthcoming book called Green Inc: An Environmental Insider Reveals How a Good Cause Has Gone Bad (Lyons Press) by a journalist and activist named Christine MacDonald piqued my interest. MacDonald argues that big green environmental groups – specifically Conservation International (where she worked briefly), The Nature Conservancy and the World Wildlife Fund — have become too cozy with corporate America.

The big conservation groups are “deforming themselves,” engaging in “questionable practices” and cultivating “unsavory corporate ties,” she writes. They are conflicted because they take corporate money. They are too quick to provide cover for bad actors:

Groups that once dedicated themselves solely to saving pandas and parklands today compete for the favors of mining operations that remove entire mountaintops, logging and paper companies that clear-cut old growth forests, and homebuilders who contribute to urban sprawl. They rely on funds from cruise ship companies, despite the industry’s record for polluting the oceans. Among the most generous donors are the biggest environmental scofflaws of all: energy companies.

It’s an explosive charge—but MacDonald fails to prove it. The book is spotty, uneven and ultimately disappointing, for the most part lacking the specifics that would show how conservation groups either enabled or covered up bad corporate behavior. But Green Inc. does raise provocative questions about the business models of some of America’s most important green groups.

MacDonald’s basic point—that conservation groups work closely with polluters—is both true and unremarkable. No one would expect the pastor of a church to close its doors to sinners; why, then, should we ask environmental groups to refuse to work with oil companies, mining companies, home builders or giant retailers like Wal-Mart. (McDonald, as it happens, also uses religious language to make her case, writing at one point that CI and others are “guilty of making deals with the devils of deforestation, habitat destruction, and global warming.”) Hey, people rob banks because that’s where the money is. Environmentalists need to get their hands dirty and deal with polluters.

It’s important to understand the role that CI, TNC and WWF play in the NGO ecosystem. They are collaborators, not activist groups. Other green NGOs are activists, and many are both essential and effective—the Rainforest Action Network, Greenpeace, Forest Ethics and Earthworks, to name just a few. But after they raise a ruckus, big companies frequently turn to groups like CI, TNC and WWF for guidance and help in making those pesky activists go away. (You can almost think of the Rainforest Action Network as the business development arm of CI.) Other NGOs like the Environmental Defense Fund and the Natural Resources Defense Council juggle both roles—they are sometime allies, sometime critics of corporate behavior. They’ll sue a company one day, then make nice the next. Hey, the world’s a complicated place.

The key question is, what impact do the collaborative groups have after they engage? I’ve spent a lot of time looking at work done by Conservation International (with Wal-Mart, Starbucks, McDonald’s and Marriott), less with World Wildlife Fund (mostly with Coca-Cola) and none with The Nature Conservancy. My strong belief—informed by reporting—is that they do a lot more good than harm. CI helped guide Wal-Mart through its ambitious and impressive sustainability drive. (By coincidence, I was on a reporting trip today with people from both Wal-Mart and CI who are working together to clean up a big, polluting industry. More to come…) WWF is doing superb work around water and supply chain with Coke, and Jason Clay, who works there (and who I wrote a column about last month), is an important thinker around the question of how to make agriculture more sustainable

Having said that—MacDonald tells a couple of stories that I’d like to know more about. She writes about CI’s work with Bunge in Brazil, saying that CI has allied itself with the company and against local groups protesting deforestation for soy. She accuses an alliance of companies, NGOs and governments called the Business and Biodiversity Offset Program of helping a mining consortium develop valuable forests in Madagascar. LI’d like to know more—so anyone who has insight into these projects, please email me.

I’ve also come away from this book wondering whether CI, WWF and TNC pull their punches because they don’t want to offend corporate donors. I think these groups and others need to be more transparent about their funding sources, particularly since they ask the public for money. They say they don’t depend on corporate donations or fees. (CI’s Glenn Prickett tells me that less than 10% of their funds come from corporate contributions.) But that accounting does not include donations from corporate executives acting as individuals or family foundations. MacDonald writes that CI got $21 million from the Walton Family Foundation (founding family of Wal-Mart) in 2005, representing nearly a quarter of its revenues that year. I wonder about CI’s partnership with Fiji Water, especially since one of the company’s owner sits on the CI board. (Shouldn’t a conservation group discourage consumption of bottled water?) MacDonald also writes that TNC received “hundreds of thousands of dollars in Shell donations” before giving the company a leadership award. If true, that’s yucky.

Here’s a thought: Whenever an NGO produces a press release praising a company, or announcing a partnership, or giving an award, maybe it should disclose how much money it has been paid by the company for consulting and how much money executives, company founders and their foundations have donated.

You might argue that it would be simpler for these groups to refuse all corporate money. I disagree. They provide valuable advice and expertise to companies; there’s no reason that individual or foundation donors should foot the bill when CI helps Starbucks develop a program for rewarding coffee growers who embrace sustainable practices or WWF helps the sugar industry develop more sustainable growing practices.

But more transparency would help. To that end, I will ask CI how much money it has taken in from Fiji Water and WWF how much it has gotten from Coke. (In the interests of transparency, you should know that CI is a programming partner of Fortune’s Brainstorm: Green, a conference on business and the environment that I chair; my wife works for Greenpeace; occasionally I am paid for giving speeches and moderating panels but if the client is a public company, I give the money away; and my daughter’s a summer intern at Edelman, a PR firm with a big sustainability practice. I try to set all that aside when I write.)

Your thoughts?

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