Dilemma of historical relationship with economic benefits

Many a time companies develops relationship with some charity organizations (hospitals trust etc). These relationship are developed unconsciously and no one think about how much it will cost in future or how difficult it will be to break this relationship.

When the profits are running low and the cost of input goes up, these organizations start looking for cost cutting and see these liabilities as a financial burden on the shareholders. These relationships are developed for the social benefits in the beginning and it may not be possible to break relationship publically.

In India, some of the business groups supported social cause to such an extent that they have become synonyms with the trust. There is a very big business groups based in Kolkata, India, that has worth around Rs. 5000 Crore (more than a US $ 1 billion) but all this money is tied with the trust.

This kind of business problem can arise anywhere. I was reading about one of the corporations that has supported a football club for almost 90 years and now want to breaks its ties with the clubs and it is finding it’s difficult to do so.

I don’t think there is any answer to this kind of business problems. Decisions are solely based on the judgement of the management team.