August 5, 2015; NZ Herald
A partnership between Uber and the Red Cross in New Zealand was announced this week. A similar partnership between Uber and the American Red Cross earlier in the month went almost unnoticed. How come?
The clue may be in the recent abandoning of a plan for Uber to partner with UN Women, as reported in the NPQ Newswire. UN Women’s rejection of the collaboration came subsequent to a popular backlash to Uber’s announcement.
Attempts to enhance corporate reputations through sponsorship are, of course, nothing new, but doing so holds risks for nonprofits, which are linking their presumably good names to ones with more reputational problems. And, indeed, the reputation of Uber has a few “spots” that could do with an application of Twinkle Polish. Take the criticisms of “surge pricing” that led to an Uber “Ride for a Cause” promotion, which saw them partner with six New York City charities in March of last year. More alarming have been accusations of sexual assault by Uber drivers. A website run by the Taxicab, Limousine & Paratransit Association (TLPA) keeps tabs on accusations against Uber and Lyft. TLPA, naturally, can scarcely be described as a disinterested party. They accuse the two ridesharing rivals of failing to provide adequate insurance, evading background checks, and more. In Delhi, India’s capital city, Uber was forced to stop operating after accusations of rape were made against a driver. (Boston is seeing similar charges lodged against one of its drivers.)
On top of that, there is a debate raging regarding Uber’s treatment of its workforce and its undercutting of the existing workforce of taxi drivers—in part, according to those drivers, due to the lack of regulations applied to the service. This all spells “reputational risk” to us, but we are sure there is a lot we do not see.
The effects of the Uber partnership with Red Cross have yet to be played out. The American Red Cross is having its own reputational problems though it is clearly one of the most enduring brands in the nonprofit sector. “The American Red Cross is grateful for Uber’s support. This innovative new partnership will enable the Red Cross to deliver additional disaster relief services to those in need,” says Neal Litvack, chief development officer of American Red Cross.
Early results of the partnership saw a $100,000 portion of the fares passengers paid during the last two winter storms in Boston donated to that city’s Red Cross. That may end up being cheap at the price.—John Godfrey and Ruth McCambridge