Executives on loan

When corporate chieftains work for a while in a nonprofit's shoes, both sides can make strides.

Derk Tenzythoff wasn't sure what to expect when his firm "loaned" him to the United Way in Tulsa, Okla., for four months last year.

As vice president of programming and marketing for UVTV, a division of TV Guide, he knew television pretty much inside and out. But then he joined about three-dozen other local corporate executives to help United Way during its annual fundraising campaign – and, in the process, he learned a lot about what it takes to run a nonprofit.

Mr. Tenzythoff continued to be paid his regular salary by his employer during the course of the "loan." But he worked solely for United Way during those four months, becoming the agency's lead person for contacting all the construction companies in Tulsa as part of the fundraising campaign.

"You're getting the word out," says Tenzythoff of the campaign, which yielded $24 million in donations last year. "You get as much information about the agencies United Way supports here into those companies as possible. The more people know, the more likely they are to give."

Tulsa firms have been loaning executives to the United Way since 1984 in a kind of corporate giving that has been growing in popularity: paying employees to work for local charities for days, weeks, or months at a time.

"We in the nonprofit sector are very enthusiastic about this," says Sara Melendez, president and CEO of Independent Sector, a nonprofit organization that tracks trends in giving and volunteering. "These people usually earn a lot more in a for-profit environment than a nonprofit could pay them.

"In addition to writing a check, this is another way that corporations can help in their commitment to their communities," she says. "Because a real live person brings business knowledge and skills that not all nonprofits can easily acquire on their own, it's important because there is a growing sense of the need for nonprofits to learn from the best of business practices."

Although no hard data are available, a recent study by Prudential Insurance of America estimates that a third of large US companies now have formal policies to pay workers or give them time off for volunteer work.

Experts say the practice grew in the 1990s, in part because of a growing cultural and corporate emphasis on volunteerism, nurtured through groups like The Points of Light Foundation, which has a special program to help corporations develop employee volunteer programs.

In addition, says Dinah Waldsmith, senior manager of community investment with Business for Social Responsibility, many companies also began to think of employees as stakeholders during the last decade, and looked for ways to show their commitment to employee concerns.

"Companies are doing what they can to make sure employees are aware of the ways in which companies support things the employee cares about," says Ms. Waldsmith. "In the case of corporate-sponsored volunteering, or loaned executives, the company is kind of walking its talk."

At Whole Foods, the national grocery store chain that specializes in sales of natural and organic foods, the company has been walking its talk since 1993, when it began paying employees at every level in the company for up to 20 hours of work each year at a nonprofit organization of their choice.

"We did it to show that we're really committed," says Cindy Bradley, vice president of human resources and team-member services. "We really wanted our team members to be involved in our communities."

According to Ms. Bradley, Whole Foods spent nearly a half-million dollars last year in payment to employees who chose to participate in the volunteer program. Although the company doesn't track who decides to participate, it does measure the amount of money it spends, and those figures show that employee interest in the program has grown steadily, she says.

The amount Whole Foods paid its employees for community service hours grew by 15.7 percent between 1999 and 2000, and by 19.8 percent the following year.

Dino Moody, who works at the Whole Foods store in Torrance, Calif., is a huge fan of the community service hours program, as it's known in the company. He uses his 20 hours to volunteer at Covenant House in Hollywood, which works with street youths.

"It's a really creative way to boost morale in the store. It makes team members really stoked to be able to work outside the store and to interact with the community," says Mr. Moody, who also contributes dozens of additional hours on his own time each year to Covenant House. "It helps people already involved in community service to continue their work in the community without adversely affecting their time at work."

Many firms are finding that, in addition to boosting morale and demonstrating commitment to community values, employees learn things in the nonprofit sector that they would never learn in a corporate culture.

At Cisco Systems, for example, company executives sought innovative ways to deal with last April's layoff of 6,000 employees. They came up with a pilot project, called Community Service Fellows, which gave laid-off workers the opportunity to earn a third of their salary, with full company benefits, while working for a nonprofit organization for a year. Eighty people signed up for the program, which runs through July of this year, at which point they will have two months to look for a new job.

The "fellows" are working in a variety of nonprofits, including domestic-violence shelters, food banks, and low-income housing organizations. According to Mike Yutrzenka, Cisco's senior manager of community investment, the workers aren't giving just their skills in finance, human resources, marketing, and technology – they're learning new ones.

"One of the most important things they're learning is the passion nonprofits have for their work, that employees there are doing it because they love it," he says. "Another area is frugality. They know very well how to stretch a dollar and get the most use out of it. The other area is customer service. We focus very much on that as an organization, but nonprofits bring it to a whole new level when it comes to working with those in need out there."

Sandra Hodgin took advantage of the community-fellows program after rearranging her life – renting out her condo to cover the mortgage, moving back in with her parents, and taking a weekend job to allow her to work with InnVision, an organization which provides housing for the homeless.

During her 3-1/2 years at Cisco, she'd been part of a huge accounting department, and had just become a financial analyst before being laid off in April 2001. Now, at InnVision, she's one of only three people doing all the organization's financial work, from balancing books to dealing with government grant money.

"I've gained a better knowledge of accounting in general, and I've gained a lot of management experience," says Ms. Hodgin. Although she hopes to find a job within Cisco when she finishes her work as a fellow in July, she says her work at InnVision has been rewarding. By providing her with the opportunity to live as a resident manager at one of the organization's facilities, she gained real experience working with the community.

As for Derk Tenzythoff, the executive loaned to United Way in Tulsa last year, he found the work so rewarding that when his company was sold and moved to Chicago, he decided to stay behind and take a new job – coordinating the loan-an-executive program at United Way.

"If I hadn't been a loaned executive, I'm not sure I would have considered the job very seriously," he says. "I guess I had an image of nonprofits maybe not being as businesslike as for-profits. But as a loaned executive, I saw that it's really a business, that you want to be as efficient as possible, so that as much money goes to the agencies as possible.

"I've learned an awful lot already," he says. "I've learned the dedication of the people here. And I think my background has helped me streamline some things here, to be a bit more businesslike in some ways."

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