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Letter From America

Philanthropy Starts After Profits Are Tallied

Foundations are the new Birkin bags. Everyone who is anyone has one. Giving is now chic. Far from being in denial about it, many wealthy people fret over rising inequality these days, in public and in private.

When they do, giving invariably comes up — whether traditional charity, multiple-bottom-line investing or corporate social responsibility.

What is less fashionable to talk about is the way that those with wealth take before they give. There is an unwritten social rule now that you can harangue the wealthy to give money away, but you mustn’t ask how the money was made. There are no galas celebrating the money people knew better than to seek. Charity begins after profit.

So consider this utter faux pas of a thought experiment: Would a multinational corporation do more to advance its goal of corporate social responsibility by paying all of its workers at least $15 an hour or by doling out money from its foundation to, say, provide temporary housing to the families of hospitalized children or build playgrounds or promote physical activity?

In a sense, the debate comes down to this: Should corporations forgo some profit to help the world, or should they invest their profits in doing some good, in the process diverting attention from what’s behind their financial success?

Take McDonald’s. The fast-food chain proudly promotes its philanthropic endeavors: the $21.7 million the company and its subsidiaries gave away in 2013, which amounts to one dollar for every $1,300 of revenue; the 12 playgrounds it helped to build; the game it co-developed with Nintendo, to foster physical activity among youth; and the 15 new Ronald McDonald Houses for the families of sick children.

In McDonald’s annual report on sustainability and philanthropy, J.C. Gonzalez-Mendez, who holds the title of senior vice president for global inclusion, community engagement and philanthropy, wrote that giving back was “integral” to the company, which seeks to have “a measurable impact on the well-being of children and their families.”

Such impact is possible for an institution like McDonald’s. Along with its franchisees, the company employs 840,000 workers in the United States alone and claims to feed 69 million people a day.

But it has scarcely given in to protests by employees seeking a base wage of $15 an hour, even in the face of evidence that its low pay forces workers to live on government support, including food stamps. And though it has announced plans to remove controversial ingredients like maltodextrin and has started to offer healthier items like apple slices, does its charitable work offset the consequences of a menu that is still dominated by fried and fatty food?

McDonald’s is hardly alone. We live in a period of extremes.

Goldman Sachs helped to wreak havoc on the housing market, betting against the very investments it was pushing on clients. And then it took a sliver of its revenues and used it to provide money, mentorship and training to “over 10,000” female entrepreneurs around the world. But how many women saw their businesses implode or their pensions disappear because of the financial crisis Goldman helped to foster? Would society be better off if Goldman took a more restrained approach to both the balance sheet and charity works?

Even when the scale of the charity is enormous, as may be the case with Bill Gates and Microsoft, it makes one wonder how a person so giving in one phase of life ran a company so famously merciless that it spent years in court for its aggressive business tactics.

One problem with this extreme form of give and take is that companies don’t devote equal resources to each. If it doesn’t seem that way, it may be because the wealthy pay to publicize their giving and pay to obscure other aspects of their corporate culture.

Giving is, to be sure, a form of gratitude for fortune. It is, too, a mode of compensation, of repairing the collateral damage of success. But it’s also a deft way to continue taking in all the old unkind ways and declare “Nothing to see here, folks.”

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A version of this article appears in print on   in The New York Times International Edition. Order Reprints | Today’s Paper | Subscribe

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