Turning Gadflies into Allies

Companies view nongovernmental organizations as pests, or worse. But joining them can be more productive than swatting them, and just might give your company an edge.

by

Michael Yaziji

by

Michael Yaziji

From the Magazine (February 2004)

Summary.

While NGOs have the potential to act as a thorn in the side of businesses and investors, the authors argue that partnering with these NGOs instead of opposing them can help companies to avoid costly conflict, as well as enabling them to use NGOs’ assets to gain a competitive advantage. Specifically, companies can draw on NGOs’ key strengths — legitimacy, awareness of social forces, distinct networks, and specialized technical expertise — to both improve their own operations and support the NGOs’ causes. With NGOs as allies and guides, companies can become empowered to accelerate innovation, foresee shifts in demand, shape the legislation that most affects them, and set technical and regulatory standards for their industries.

Multinational companies are the driving force behind globalization, but they are also the source of many of its most painful consequences, including currency crises, cross-border pollution, and overfishing. These remain unsolved due to two kinds of failures. For one, such issues are, by their nature, beyond the scope of individual governments to avoid or resolve. For the other, transnational organizations, such as the World Bank, the International Monetary Fund, and the World Trade Organization, have proved unequal to the task.

A version of this article appeared in the February 2004 issue of Harvard Business Review.

MY

Michael Yaziji (michael.yaziji@imd.ch) is a professor of strategy and organization at IMD in Lausanne, Switzerland.

Turning Gadflies into Allies

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