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What happens when a partner stumbles?

When social alliances between for-profit and nonprofit entities work, the partners walk a flowered path. The association with a good cause boosts the corporation's image. The nonprofit group gains far more recognition through the company's marketing reach than it ever could on its own.

But if one of the partners falls into a public-relations tar pit, should the other partner walk away or try to help - and risk getting smeared?

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That's the question Boys & Girls Clubs of America faced as its longtime partner Nike got embroiled in a child-labor scandal a couple of years ago. Labor activists charged the company was using Asian factories that hired and abused children.

"When all that news broke we got on the phone with Nike right away," recalls Roxanne Spillett, the nonprofit's president. "[Nike] had been one of our first partners and extraordinarily generous with us. As we got to ... understand the issue, we felt Nike was responding responsibly to the allegations."

In May 1998, the sports-apparel company finally pledged to end its use of child labor.

Save the Children faced a similar dilemma in 1994. Denny's restaurants wanted to make a major commitment to expand the nonprofit's after-school programs in the US. But the chain earlier that year had settled a $54.4 race-discrimination suit and continued to be criticized in many of the black communities Save the Children hoped to serve.

"I came in as a new person very, very concerned," recalls Catherine Milton, the group's newly hired executive director for US programs. She struck a deal with Save the Children's chief executive and board chairman.

"If I did not personally feel good about what Denny's was doing to solve its problem, we would not take their money," she says.

Ms. Milton spent 2-1/2 hours interviewing Denny's chief executive, met with several top managers, and attended one of the company's major national franchise meetings. "I came away convinced that they had serious problems but that they were extremely committed and systematic in addressing them," Milton recalls.

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As time went on, community leaders and even employees questioned the group's affiliation with Denny's. But Save the Children stuck by the company and convinced many community leaders that the company was headed in the right direction.

"It would have been devastating" had Save the Children pulled out, says Susan Schneider, Denny's director of national promotions and community relations. But "they really understood our commitment."

Since then, Denny's has implemented wide-ranging diversity training and was named this year No. 6 in Fortune magazine's list of 50 best companies for blacks, Hispanics, and Asians.

As it grew to become the nonprofit's largest corporate sponsor, Denny's had the opportunity to return the favor last year. The Chicago Tribune reported that Save the Children had serious operational problems, including taking sponsors' money for deceased children.

The nonprofit kept the company informed about the newspaper's investigation and outlined the corrective steps it was taking.

"They were a really good ally at a very difficult time," Milton recalls. "It really strengthened the partnership."

"It's like a good marriage," adds Ms. Schneider of Denny's. "We want it to work. They want it to work. It's been pretty smooth."

(c) Copyright 1999. The Christian Science Publishing Society

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