"Every year, the sums we donate just go up and up. Because of the economic situation and the decline in government support, care centers are closing and more and more people are turning to us," SuperPharm CEO Leon Koffler said recently at the Therapeutic Riding Center in Tel Monde, which was set up with donations from the Koffler family and Amdocs founder Morris Kahan.
Koffler's comments reflect the economic reality of Israel 2004. The poverty report published by the National Insurance Institute in November 2003 places 18.1 percent of the Israeli population below the poverty line - a figure that reflects the increase in unemployment, cutbacks in NII benefits and the tightening of criterion for unemployment benefits.
The place of the state, which is cutting back its welfare support, is being taken over by corporations and private individuals. The phenomenon did not begin with the present recession - which is considered the longest in the country's history - but in the past two years it has become firmly entrenched.
The economist and Nobel Prize winner Milton Friedman has said a company CEO should not donate money. In Friedman's opinion, the goal of a company is to create dividends for its owners and therefore a donation is tantamount to the CEO stealing from the owners.
Unlike Friedman, Eli Fischer, the owner of the Dr. Fischer pharmaceuticals and cosmetics chain, believes a brand that wishes to survive over the long term must contribute to the community. Fischer, who opposes anonymous charity, says consumers prefer to buy products from a company that contributes to the community and thus increase its earning and enable it to donate more.
According to Fischer's theory, everybody wins - companies, consumers, citizens and the state. The problem is that corporate donations, for the most part, are normally made to institutions connected to the corporation's field of activity, to the consumers it is targeting or to institutions that are connected to the decision makers within the corporation.
Sometimes it is not the charitable cause that a particular institution represents that counts, but the connections of the public figures associated with that institution.
It is the right of a corporation to decide to whom and to what cause it wishes to donate money. For example, Zoglobek decided a few years ago to back the "Adopt a combat soldier" association in order to improve its image in the wake of a tainted goods sales scandal. But isn't it the state's role to ensure the welfare of IDF combatants?
According to figures released by Shatil, an organization that connects NGOs and businesses interested in making donations, the leading sectors to which businesses donated in 2003 were children and teenagers (34 percent); health consumers, the sick, and organizations and businesses concerned with health-related affairs (19 percent); soldiers (9 percent); and poorer sectors in need of aid (7 percent).
All charitable donations are welcome, of course, but it is hard not to wonder if the state is acting prudently when it leaves to business interests - steered by marketing and sales concerns - decisions of who will and won't receive aid.
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