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New Models for Corporate Giving

March 26, 2012

CREDIT: Han Nguyen/St. Bernard Project

JULIA TAYLOR KENNEDY: Welcome to Just Business. I'm Julia Taylor Kennedy.

For many years, large corporations would set aside pieces of their budgets to be good neighbors. They would give art scholarships to local students or send volunteers to plant trees on Arbor Day. While those projects weren't bad, there's a move to make more sophisticated contributions that build on employee expertise and that engage experts to fight global poverty. Today, I'll talk to two of those experts who are pushing the envelope in terms of corporate citizenship and philanthropy.

My first guest is Mari Kuraishi. When Kuraishi founded GlobalGiving ten years ago with a colleague from the World Bank, she thought the online platform would cater mostly to individual donors who wanted to give to small nonprofits in the developing world. But as the site grew, more corporations hired GlobalGiving to create tailored employee giving programs. Today, companies represent the majority of GlobalGiving's revenue.

Kuraishi started her career at the World Bank as a country officer in Russia and left to start GlobalGiving, which filled a gap that she saw in the field of economic development.

MARI KURAISHI: It was clear that some of the structure, particularly the financial flows around development, made it very difficult for small and emerging organizations who might have ideas about how to do things differently. It was very hard for them to get started.

This was an environment that favored the usual suspects. When we figured that out, we undertook some initiatives at the World Bank to foster and spark innovation, but ultimately we decided that there needed to be a platform out there in the world where small, less well-known organizations could establish a legitimacy and get support. So that was the beginning of GlobalGiving.

JULIA TAYLOR KENNEDY: And why do you think it works better to build this platform outside of the World Bank? Why decide to go off on your own?

MARI KURAISHI: Because the World Bank was set up as an international treaty organization. It's part of the UN system. Sovereign nations are its members. Sovereign nations are its borrowers. Once you have that structure and governance in place, it becomes very difficult to sidestep, as it were, the principals in this, which are the sovereign nations, which is not to say that sovereign nations don't have a huge role in promoting development.

But what we wanted to do was avoid the existing power structures and reach out to organizations that may be perfectly friendly to the regime. This wasn't an issue of politics as much as that we wanted to be able to play with small amounts of money, because trying and failing at $100 million and above is not acceptable to most people, whereas trying and failing at $10,000 is well worth trying.

So the scale and the governance and the institutional structure of the World Bank simply wasn't suited to supporting startups, as it were.

JULIA TAYLOR KENNEDY: So there is room for both, is what you're saying.

MARI KURAISHI: Yes.

JULIA TAYLOR KENNEDY: Explain to me a little bit about the platform and how GlobalGiving works. Say I'm an individual donor. How does it work?

MARI KURAISHI: As an individual donor, you might encounter our platform as GlobalGiving.org. It might be the end of the year and you might have served in the Peace Corps in Burkina Faso and think, "It would be kind of nice to put some of my charitable dollars towards an organization in Burkina Faso. It has been a long time since I was there. Why don't I go see what's there?" You might start browsing the organizations on our site on Burkina Faso. The donation amounts are as small as $10 and up. The average transaction on our site takes less than five minutes, so you can literally take five minutes and get this done.

You might encounter GlobalGiving through one of our corporate partnerships. You might be, say, an employee at one of the companies that we work with on employee giving, and your employer matches, so you have a strong interest in working through this platform. Say you're a Nike employee or an Eli Lilly employee. This would be part of your Intranet. You would go to it and make your donation and have your donation matched by your company.

JULIA TAYLOR KENNEDY: That's usually a one-to-one match? How do those matches work?

MARI KURAISHI: Almost all companies have a one-to-one match. Some are even more generous than that.

JULIA TAYLOR KENNEDY: And when you started it, did you envision that corporate partnerships would be such a big piece of what you're doing?

MARI KURAISHI: At the very early stages, no, but fairly early in the game, in 2002 or so, we thought, "This is crazy. Why are we just sort of trolling the universe for people who want to give rather than going to where people are primed to give? Many corporations see fit to provide a structure, incentives, and all of that around giving for their employees. So let's get ourselves in front of the corporation, who will in turn make us available to their employees, and that takes care of us not having a marketing budget."

JULIA TAYLOR KENNEDY: What's the advantage for corporations to work with you as opposed to, say, hiring an internal corporate philanthropy person?

MARI KURAISHI: Partly because when you are running a multinational company that is focused on producing pharmaceuticals or selling sports apparel, you're not hiring philanthropists or philanthropy specialists into your workforce. It's a rare find to find someone who is going to be a good fit to that program, whereas we hire people who are interested in philanthropy and who do that every day.

Secondly, I think we have experience, from not just running GlobalGiving.org, but working with many other corporate programs, and we have coverage in networks in over 120 different countries. That's something that can be turned on, on a dime, whereas an organization that turns around and says, "Well, we really want to get active in some emerging markets where we have not yet been active, but we want to get active." They don't necessarily have the networks and the knowhow to source the projects that are a good fit.

JULIA TAYLOR KENNEDY: This is interesting. You find that a lot of businesses want to do some projects in markets where they are going to get involved, get their name out in the community as a good corporate citizen.

MARI KURAISHI: Yes.

JULIA TAYLOR KENNEDY: Interesting. Your list of corporate partners is breathtaking. It's very impressive and broad. A lot of these programs are employee giving.

You said you are working with corporations that are primed and ready to give matches of what their employees give for. Do you find that, for some reason, when there is that organizational endorsement, the employees are more likely to donate? And why do you think it works that way?

MARI KURAISHI: It depends really on the organization. An organization that has a corporate match, that takes the trouble to create a platform for its employees, creates an atmosphere in the organization that says it's appropriate and expected to be generous. Frequently they will also support volunteering. X number of days are paid for by the company for you to go and volunteer at different nonprofits. What they do is, they create a culture for engagement and generosity.

I think that is a big difference, whether it's formally matched or no. In many cases, if the company has gone to the trouble of setting up this, they usually match it, and match it quite generously. I think that makes a huge difference.

JULIA TAYLOR KENNEDY: I've noticed a trend in corporate philanthropy as well, moving towards the company being interested in projects that are in line with existing expertise. Do you find that companies approach you interested in that kind of work ever or are they usually more geographically based interests?

MARI KURAISHI: Many companies come to us with specific interests that line up with their—a company that is involved in pharma might be interested in health-related nonprofits. A company that is involved in sports apparel might be interested in the role that sports play in youth development. So there is usually a thread that ties the business and the philanthropic activity.

In other cases they are much more interested in simply getting something done in a particular location. It could be related to kids. It could be related to adults. It could be related to a number of different things.

But it depends on the company. Very few companies say, "We've got a bunch of money. We just want to do some good." They are really a little bit more focused than that.

JULIA TAYLOR KENNEDY: I did see one example. You work with Pandora. They focus on music projects, which I thought was interesting.

MARI KURAISHI: Yes.

JULIA TAYLOR KENNEDY: So if you do encounter a corporation that's more hands-off, how do you work with them? Do you try to engage them more or does that sort of free you up to decide where the money goes?

MARI KURAISHI: Some organizations have very specific ideas about where they want the money to go. We just simply work with them to ensure that their grant-making is solid. Other organizations say, "Recommend something." Then we will say, "Okay, what are your interests?" and narrow it down.

We recommend organizations that we think are high-capacity, responsive. They might be interested in having local volunteering opportunities for their employees, so we try to take that into account. Then we'll come up with a short list of organizations and bring it back to the company, and they'll either say, "Well, let's just distribute the money among them," or, "I like this one."

Depending on the company, we play more or less an advisory role.

JULIA TAYLOR KENNEDY: Do you find that more corporations are getting it in terms of being global citizens? Do you see a more intelligent approach to doing targeted projects, not just to be well known in a community, but actually to make impact?

MARI KURAISHI: Yes, I think CSR [corporate social responsibility] is getting more sophisticated every day. To your point about whether corporations try to match up their philanthropy with what their core competencies are, I see more of that. I think that's actually a great thing, because it means they are engaging with their minds and their institutions and their manpower, not just with their dollars.

Dollars are fungible and can be turned into anything. But when a corporation engages its employees and encourages them to volunteer and really leverages who they are as a company, as well as who they are as individuals within the company, I think that's when CSR steps it up one notch.

JULIA TAYLOR KENNEDY: I think it makes sense, because this is obviously an area where they have both expertise and passion. So it would make sense to do something that's aligned.

MARI KURAISHI: Exactly. You're a coder because you think code makes a difference. You may be working for a for-profit entity, but you know perfectly well what the power of coding is. To be able to turn it to a nonprofit purpose, a public good, is, I think, empowering.

JULIA TAYLOR KENNEDY: Great. Mari Kuraishi, thank you so much for sitting down with me. It has been really interesting.

MARI KURAISHI: Thank you for having me here.

JULIA TAYLOR KENNEDY: That was Mari Kuraishi, president of GlobalGiving. The organization connects U.S. donors and companies with small nonprofits in the developing world.

My next guest is Nate Garvis, former vice president for government relations at Target and current founder of Naked Civics. At Target and at his current consultancy, Garvis encourages corporations to engage directly with communities instead of focusing on lobbying government officials.

He discovered the value of direct community engagement when Target responded to a crisis in western Minnesota near its company headquarters.

NATE GARVIS: There was a really horrific murder in western Minnesota. An 18-year-old girl was abducted, raped, and murdered by a guy who had been a repeatedly convicted sex offender. I was talking to the commissioner of public safety. He was a friend of mine.

I asked him, "How could this happen? The guy was out on the street and whatnot."

He told me how disjointed and unconnected all of our criminal justice outfits were throughout the state—in fact, everywhere in the nation. Having worked at Target for a while, you start thinking like a retailer, and I said to my friend, Charlie Weaver, "You know, Target knows where every pair of socks are in the chain, and you don't know where your felons are. Maybe we can do something about that."

So working with a really cool Republican and a really cool Democrat in the Minnesota legislature, we launched something called CriMNet. It was really about sharing inventory management practices with the law-enforcement community.

That was the first step to pull off some really cool community benefit. No one could look at Target and say, "Well, you're getting benefited better than anyone else in this arena." We were making the streets safe for Walmart, too.

It was purely—I won't say it was a pure philanthropic effort. Target always knew that it doesn't do well in a bad neighborhood. You can sit around and gripe about that or you can roll up your sleeves and work with others to engineer what it takes. That was really the first moment when I understood the power of looking at, not only what we do, but how we do what we do. What are our special skills and technologies, and how can those be applied in other areas?

JULIA TAYLOR KENNEDY: It seems like you were looking for a way to build on Target's inherent strengths. That seems to be a trend in corporate outreach. Can you talk about why that's important?

NATE GARVIS: I think it's important for a couple of reasons. One is that for most corporate settings—and even at Target at that time—it was highly unusual to start working these efforts from a public policy standpoint.

Because of that, I think it's important that you hit it out of the park the first time. Don't try to solve world peace all at once. Start by going after your piece of the world and making sure that you are building efforts that have a reasonable chance of success. If it is innovative, you won't be able to prove a crisp ROI [return on investment] on the front side. In fact, if you could, it's not so innovative, right?

So as you talk to your partners inside, to go after them and say this is a revolutionary thing for us to do is usually intimidating. But if you can go after them and say, "You know, this is just a refinement of what you're already doing. Apply it here and it will produce some really cool value."

No one questioned the fact that Target had supremely good inventory-management technologies and skills. That was not up for question. What was up for question was, could we work with a series of public agencies and transfer that knowledge?

So working with people inside of Target and saying, "First of all, you have a huge amount of competency around this. That's good. I have these great relationships. I'm pretty confident that I can wield the knowledge transfer side of it. That's good." Then also, as I said earlier, that cultural aspect—to be able to go to someone who worked inventory-management IT, for instance, and say, "You're a dad. I'm a dad. There are murderers out on the street. You're sitting on some really cool knowledge. I think just by refining how it's used in our communities, it could produce some really great benefit."

That ended up being a pretty easy sell. People actually got excited that what they did every day could produce community benefit beyond a financial return.

JULIA TAYLOR KENNEDY: What is the long-term benefit for Target in engaging in these kinds of projects?

NATE GARVIS: It's a great question. I think there are a lot of different aspects to looking at long-term return. I think that's an important question for every corporation to explore because the short-term return oftentimes is not so clear.

The long-term return for Target in a project like this was, again, Target doesn't do well in bad communities, so safer communities are really important. Target's guest doesn't live in a dangerous community typically. The team members that come and work at Target don't come out of those neighborhoods either. So there is that kind of community capacity to it.

There was the long-term benefit of employment brand. For folks who are out there looking for, hypothetically, a large retailer, this was a pretty cool marker that, "Yes, I can get a paycheck anywhere, but this company seems to do things that are above and beyond, and I want to do that in my life." So there is that aspect of it.

There is a great long-term benefit in the relationship curation that goes on. You're building out stronger relationships throughout your community, and in ways that are really kind of counterintuitive. You are transferring your identity from, "We're a big business that makes a lot of money and pays taxes," to, "Yes, we're that, but we are also part of the productive fabric in your community, and the people who are important to you in the community are important to us, and we're investing in them."

JULIA TAYLOR KENNEDY: Yes, and I would think, from your perspective, that's a really key advantage, right?

NATE GARVIS: Oh, it was just amazing. I think that's again one of the new markers of this world. People have to understand the currency, the powerful currency, behind a trusted relationship. That's not just on an individual basis, but on an institutional basis.

On the whole, Target, as an example, has really strong relationships with public safety and first responders throughout the world. It has created enormous amounts of opportunity for our communities to have those two institutional communities working so well together.

JULIA TAYLOR KENNEDY: The company underwent a real renaissance in the time you were there, bringing in big-name designers, creating this public image of stylish affordability. What was it like to be part of the company during that time?

NATE GARVIS: I was hired by Dayton Hudson, the parent company. This was in the early 1990s. Dayton Hudson, back when I worked for them, had Target and it had retailers like Marshall Field's and Dayton's and Hudson's and a big outfit out west called Mervyn's. Target was a really nice business, but it wasn't one of our department stores. It wasn't the name that you would throw out at a cocktail party.

I can recall some of those first moments because there was a time when Target couldn't—Elle Décor would never take a Target ad, because we were a discounter. I can recall when that ice just started to break, when we hired Michael Graves to do the scaffolding around the Washington Monument when we were paying to have it restored and the buzz that that created. Then those first Michael Graves teapots that were sold inside of Target for $29.95, where it was, like, $800 at Alessi. It was exciting. It really was. It's very cool to see your public identity broadened and appreciated.

To the subject matters that you and I are talking about, I think that's relevant. Corporations need to understand how thirsty people are for good behavior out there, and exciting behavior, and how fun it can be when you start getting recognized as responding to that.

JULIA TAYLOR KENNEDY: Why did you decide to start Naked Civics a couple of years ago?

NATE GARVIS: I was driving around one day in my neighborhood and I saw that bumper sticker, "If you're not angry, you're not paying attention." I was saying, "Just a minute. I'm not angry, and I am certainly paying attention."

It occurred to me that we had started to commoditize anger in our society, that we literally were packaging it and selling it, and selling it in this red-versus-blue flavor. I knew from personal experience in the most innovative side of our practice that that was not the only way of constructing common good. So I really started on this path of wanting to depoliticize, depolarize these conversations and move us forward rather than left versus right.

JULIA TAYLOR KENNEDY: Target has a website called Here for Good that discloses quite a bit of information in a range of issue areas, from labor and human-rights issues to responsible sourcing, to a page on civic activity. I was wondering if that was around when you were with the company.

NATE GARVIS: No. It all launched after.

JULIA TAYLOR KENNEDY: It's new. One thing that stood out to me that was interesting is, as you mentioned, it talks about the Target PAC [political action committee], which gives to a lot of local organizations and business organizations and retailer organizations. But it does sort of have a blue/red pie chart on it: 245K Democratic, 238K Republican, and 10K bipartisan, which represents about 2 percent of its contributions.

I was curious if you would rather see more bipartisan support on the company's part or if this is just kind of a fact of life that a company's PAC has to support candidates and partisan organizations.

NATE GARVIS: I don't know if there is an easy answer to that. When I had purview over the PAC, it was a different world. I did have this purple perspective.

But I think the world of political money has changed significantly since I have left. And not just political money, the whole political environment has changed as well. So I don't feel like I'm in a position to say what they should be doing. I don't have a counseling relationship with—

JULIA TAYLOR KENNEDY: Let's talk outside of Target, then. That might be easier, to talk more generally. Especially now that there is so much pressure on corporations to be supporting different political organizations, is it possible for companies to kind of break out of this Democrat/Republican support system?

NATE GARVIS: My honest answer is, boy, I sure hope so. And it's what I'm trying to do. It's one thing to play in politics. I'm not advocating unilateral disarmament, because your opposition isn't disarming either, and powerful things can happen in political bodies, so you have to be there.

My personal stance is that neither party has your interest at hand, that what we have, in a lot of ways, is politics trumping public policy in political bodies, and no one is safe. The politicians aren't safe; corporations aren't safe; liberal interest groups aren't safe. It's the world of convenient politics.

Now, back to your question, I think even at that, playing in the political realm and being smart about it—and it's difficult to be smart—I would encourage corporations, and indeed I would encourage all institutions out there, to start looking at how they can create common-good outcomes without having to always do it within the realm of politics.

We have been so trained to think that producing community health is a matter of throwing laws at each other and regulating each other through checklists. I think that's not only a difficult way of regulating our communities, by and large; it's an unpleasant and angry way of regulating our communities, and mostly an unsuccessful way of regulating our communities.

The best things that we were doing at Target when I was there didn't—I shouldn't say they never required a law, but it certainly rarely emphasized the rule of law to begin with. It was more about aligning interests together.

I think there's a lot of opportunity out there for corporations to engage in what I call pre-regulation. Don't wait until it becomes a hot-button issue. Don't wait until you're on 60 Minutes with a camera in front of you. Don't wait to get the angry call from the NGO. Look at the world, see where the conversation is going, and contact that NGO and say, "You know, we get it. It's complex, and I'm not sure how we're going to do it, but we want to make some changes, and we're going to need partners to do it." Align yourself, rather than be an adversary.

I think there is so much opportunity in the international corporate community for that, because I think there really is a growing desire for corporations to operate differently and not be forced into it, especially in political circles.

They are sitting on so many resources. They're big and powerful. They are not powerfully good or powerfully bad. They're just powerful. They become powerfully good when we create the conditions to wield the tool that way. Being adversarial is a difficult path to create that kind of outcome we all need.

JULIA TAYLOR KENNEDY: Nate Garvis, these are fascinating ideas, and I could talk to you for hours. I'll have to follow up at some point. I really appreciate your sitting down with me for Just Business.

NATE GARVIS: Thank you so much.

JULIA TAYLOR KENNEDY: That was Nate Garvis, former vice president for government relations at Target. He currently heads up the consultancy Naked Civics.

That wraps up this week's look at corporate citizenship and philanthropy. I'm Julia Taylor Kennedy. Thanks to Terence Hurley and Emil Chireno for their contributions to this week's podcasts. Thanks to Possimiste and Tony Higgins for our music.

Thanks to you, our listeners, for joining us. We're happy to hear from you. Please send questions and comments to jkennedy@cceia.org.

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