Is the rise of consumer compassion a good thing?

Something happened in the past 10 years—between the time college students were reading hard copies of The New York Times and when they started skimming social justice blogs, reading about new and inventive ways to do good in the world.

Charity became cool.

One doesn’t have to look far today to find someone doing good—whether it’s movie stars or a next-door neighbor. From someone wearing the ONE Campaign on his wrist to watching charity: water commercials on Hulu, this new trend is hard to miss: philanthropy is “in.”

This fad has also made an entrance into the business world. Charitable causes are no longer monopolized by nonprofits; now they’re embraced by the white-collar CEO and the tech-savvy twentysomething alike. In this uber-connected world of smart phones and social media, businesspeople are realizing consumer conscientiousness is at an all-time high and people want to feel good about the products they buy—whether it’s by purchasing a bag of fair-trade coffee or a handmade purse from Africa.

Businesses like TOMS Shoes and Warby Parker are able to legitimately give back to the world in an impactful way and, at the same time, make a profit. From a business perspective, this idea of infusing products with meaningful causes makes sense—people can relate to it and want to tell others about it. It’s free marketing and, because they’re making a profit, sustainable philanthropy.

But is it necessarily a good idea? What are the potential long-term effects of consumer-driven compassion?

Think back to before Product(RED). Back when clothes represented favorite bands and sports teams, and making a difference in the world used to be its own reward. A decade ago it wasn’t cool to care about the conflict between north and south Sudan; the burden of proof for why someone should care about geopolitical issues, unless he or she was a political science major, was clearly on the one doing the convincing.

It’s hard to imagine a time when cause-oriented attire wasn’t all the rage of college campuses and the local mall. But times have changed.

As Brett McCracken wrote in a RELEVANT article last September, this is not necessarily bad: “[Hipsters] are, in general, quite concerned about issues of justice—whether it be sweatshops or sex trafficking, water wells or finance reform. ... They almost always side with the underdogs (immigrants, the poor, minorities) over those with power and privilege.” So the question becomes: As social enterprise gets more popular, does it risk becoming entirely commoditized?

It’s normal nowadays for someone’s email inbox to be inundated with messages of people giving away their birthdays for well-building projects in Africa. Nobody thinks twice about a movie star wearing a ONE T-shirt or sporting a pair of TOMS shoes in the pages of a popular fashion magazine.

Social enterprise—the practice of using business to support social causes—is hard to miss. Popularized by organizations like TOMS that have taken for-profit business models and turned them into vehicles for promoting social good in the world, it’s especially hard to ignore the effectiveness of combining compassion with commerce.

But is it without negative consequence?

The good news of social enterprise is that the economics of it work. As many once-stable economies are now struggling or even toppling, nonprofits around the world are scrambling to find sustainable means of revenue to keep going.

Since the American recession in 2008, nonprofit giving has been down—and not just in the United States. An article in the Toronto Sun described an online study that found a third of Canadians surveyed had reduced their giving since the prior year due to economic constraint. Incidentally, a poor economy has led to greater participation in social causes.

Many charities are now seeing an inverse relationship between volunteer hours and donated dollars, according to an article by Dan Kadlec in Time magazine from March 2009. Since people were able to give less of their money, they were giving more of their time. While on one hand this is certainly progress, it still leaves a significant financial gap for many nonprofits who rely on the generosity of individual donors to keep the doors open. “[T]he time-money swap, which is washing over the charity world like a tidal wave during this recession, poses stiff challenges for nonprofits,” Kadlec says. “They can’t pay the rent with volunteer hours.”

Enter an opportunity for globally minded entrepreneurs to make a difference. In a down economy, most people aren’t looking for reasons to give their money away; however, they do continue to buy services and still consider more existential questions such as making a difference in the world. “People want to see results of their donation or purchase,” says Wayne Elsey, founder and CEO of Nashville nonprofit Soles4Souls. “Strong, engaging strategies with the consumer will draw them to see where the difference their donation or purchase has made.”

When times are tough, people are looking for more than just a bargain. They want meaning, to be caught up in a larger story. This is where social enterprise really is a “win-win”: it offers consumers an opportunity to do more than just consume, while still buying goods. As TOMS Shoes founder Blake Mycoskie recently wrote in a blog post: “You are now as much a part of the TOMS story as I am. When you buy a pair of TOMS, it’s you that’s helping to put a pair of new shoes on a child’s feet. You aren’t just a customer, but a storyteller.”

With this new model, organizations are no longer selling a commodity; instead, they are selling an ideal. They aren’t asking for money; they are, in turn, giving the consumer purpose. They are providing an opportunity for the purchaser to make a difference. If the product embodies a universal concept like hope, consumers are not only willing to pay money for it; they’re willing to tell the story, because, as Mycoskie indicated, it is their story, too.

Jamie Finch, a consultant for an anti-human trafficking organization called the Nomi Network, sees social entrepreneurship as a far more effective and sustainable business model than that of a typical nonprofit. Finch believes social enterprise is a “fantastic idea” and even alludes to the added bonus of having “built-in marketing” for the product.

Finch admits she was initially skeptical of the faddishness of social enterprise, but she eventually saw the ultimate good. “Fads come and go,” she says, “but the causes that are attached to them really do deeply affect and touch the people who are buying into the fads.” Pragmatically, she adds: “You have to fight for the attention of the general public in order to get them to look at uncomfortable things. If you can catch them with a shiny fad, they’ll be more apt to continue to listen.”

Maybe in some cases—at least in that of child trafficking—the end does justify the means. This does, however, raise a new concern: Even if the end justifies the means, will this trend last? The “bad” of social enterprise is the questionable longevity of it. Fads by definition are short-lived, so what happens when compassion is no longer cool or when T-shirts and rubber wristbands go out of style?

“Compassionism,” as some have called it, is a quid pro quo service. It is the mixture of doing good while consuming goods. But at the heart of it is a consumption mentality, and one can’t help but wonder if motive shouldn’t at least play some small part in philanthropy.

Lastly, there is an ugly side to this issue that goes beyond a short lifespan. What happens if this model of social enterprise is actually successful? What long-term effect might that have on philanthropy in general?

One concern is that it may hurt more than help. If we relegate our compassion to a consumption mentality, we could end up reframing philanthropy in less healthy ways, leading to a more narcissistic approach to charitable giving. Moreover, compassionism could ultimately divert necessary funds from good causes to mere products. What happens when the uninformed teenager has to choose between donating $20 to the Salvation Army and buying a T-shirt that endorses a cause? If “cool” takes the place of charity, then the cause with the greater marketing may win.

Another concern is that social enterprise doesn’t provide long-term, sustainable help. In some cases, gifts in kind can actually hurt the local economy. The overused cliché of teaching someone to fish may be applicable here. Depending on how the gifts are distributed, this type of philanthropy can propagate the “white knight” stereotype and exacerbate Western dependency instead of empowering locals.

Ultimately, there are two ways to look at this issue. One is from the perspective of the businessperson. Without a doubt, it’s a smart move on the entrepreneur’s part to tie a product to a worthy cause. It empowers the customers to tell a story, while at the same time providing an opportunity for them to legitimately help people.

The other is from the perspective of the conscientious consumer. A T-shirt, wristband or even DVD that raises awareness for an issue is great, but at some point, motive has to matter. For Christians—people whose actions are in and of themselves supposed to be acts of worship—not only does what they do matter, but also why they do it. Not to mention, there ought to be a point of maturity at which Christians don’t need to be incentivized to give, when they grasp the importance of charity for charity’s sake.

Social enterprise is a complicated issue that is, undoubtedly, doing a lot of good in the world. The questions of longevity and sustainability are certainly worth asking, but it’s hard to argue with the fact that in the short term, people in need are receiving help. It is, however, difficult to not be nostalgic. Being socially conscious used to be an intentional discipline. In some cases, it even made you unpopular. The issues were easy to ignore, and many chose the road less traveled. If people were concerned about global poverty, they really had to fight for their convictions. Not Bono. Not their T-shirt. Just them. And perhaps as fads run their natural courses, those days may return soon.

In the meantime, people should consider the long-term effects of charity—being conscientious in the process and wary of potential downsides to consumer-driven compassion. At the end of the day, change is still up to each person, and whatever you do—be it buying a pair of TOMS or giving to a nonprofit—do something.