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By Doris Rubenstein
Kudos to American Express Financial Advisors! The Minnesota-based company recently was honored by the national Association of Fundraising Professionals (AFP) as the outstanding corporate donor of 2003-2004. How did American Express Financial Advisors get the nomination and snag the award and what can other businesses learn from them?
American Express Financial Advisors are a prime example of good grant making
as defined in a new document developed by the national Council on Foundations (COF), Recommended Principles and Practices for Effective
Grant making. There are four major principles outlined.
1. Establish clear goals and procedures. This means that business leaders should develop a mission statement for their giving program and develop administrative processes and documents that reflect and facilitate the accomplishment of the mission. Grant requests should be handled with the same care and held to a set standard of scrutiny, much as in the request for bid process in purchasing. That includes a channel for communicating in a timely fashion whether the request was approved or rejected. Procedures in this category also include communication with government and the public.
2. Complying with the law. If a company has a foundation, it should follow legal requirements and be wary of self-dealing by trustees or company executives.
3. Demonstrate accountability. First in the area of accountability is ethical behavior. We are fortunate in Minnesota to have the University of Minnesota-University of St. Thomas Center for Ethical Business Cultures as a world-renowned resource on this point that is highly accessible to local business.
The COF recommends that management also conduct regular self-evaluation of the program. Previously in these pages, I’ve advised businesses to demand their Donor Bill of Rights, developed by the AFP. This gives management a basis for evaluating that their business philanthropy goes to effective nonprofit organizations. Here, self-evaluation amounts to scrutiny of the giving program in its program and administrative operations. The giving program needs to demonstrate that it is operating effectively and is appropriately funded for those operations.
Again, the COF Principles return to assuring that within the topic of accountability, there is no conflict of interest between management, staff, and others involved in the grantmaking process.
Giving programs should address change. Companies change constantly. We’ve seen that most recently with the sale of the Marshall Field’s and Mervyn’s divisions of the Target Corporation. More importantly, giving programs should reflect changes in society. The arrival of some 5,000 new Hmong refugees into the Twin Cities reminds us all of how much Minnesota’s ethnic composition has changed in the past quarter-century. This leads easily into the principle of diversity. American Express Financial Advisors has made major commitments to this area, particularly in developing programs for women in business. The COF Principles don’t demand that giving programs address diversity issues, but they do demand that diversity – in perspectives, opinions, and experiences – be respected.
4. Constructive relationships. In all businesses, there is the relationship between the supplier and the customer. In this discussion, we are talking about you, the business donor as supplier, and the nonprofit
grant seeker as the customer.
As in all good business relationships, mutual respect, candor, and understanding are indispensable in establishing a trust that is product for all concerned. It is the responsibility of both parties to act ethically for the advancement of your mutual interests.
Similarly, just as businesses cooperate and learn from others in their field through trade and professional associations, when a business steps into philanthropy, they should become part of this field by joining colleague organizations. Participating in programs offered by the Center for Ethical Business Cultures, the Minnesota Keystone Program, or the Minnesota Council on Foundations allows your business to learn best practices.
American Express Financial Advisors had some great predecessors as winners of the AFP Outstanding Corporate Donor. Winners in the past several years included Clear Channel Minneapolis, Best Buy Children’s Foundation, and Medtronic. Because they were winners, our community has been a winner as well in terms of our quality of life. Businesses striving to achieve the same level of excellence and outstanding reputation as these companies would be well served to visit the COF web site
(www.cof.org) and measure their own business philanthropy practices against the national Recommended Principles and Practices for Effective Grantmaking. This way, we can all we winners.
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