Setting Up a Foundation-Corporate Partnership

When private foundations seek alliances with business, they often do it through their grantees rather than on their own. But that’s not always the case. One foundation, for example, sought out a direct partnership with a large retail developer, in hopes of creating employment opportunities for lowincome residents of a city where the developer would soon be opening a new mall. The company had promised the city that it would give at least one-quarter of the jobs in the mall to residents of low-income neighborhoods. The foundation wanted to ensure that people who most needed and wanted the jobs would be able to apply, get training, and succeed once they were hired.

It was, in many ways, a natural fit between corporate and foundation interests: the company needed to hire the very people whom the foundation sought to help. Still, as a consultant who helped broker the partnership pointed out, the grantmaker was “very clear about where she drew her line: She was not going to put major dollars into anything that merely helped the company satisfy its obligation to the city. She said from the beginning, ‘We are in business to help the community organize itself around the opportunities that might be created by this development.’”

The consultant was the foundation’s main agent in setting up the partnership. Because there were many necessary participants in the ultimate arrangement — the city’s employment programs, community groups, various divisions of the development company, and other local agencies — the consultant spent considerable time “working closely with the company and with the community to inform many, many people. We had a lot of community and public meetings.”

Where the partnership became critically important, and where the consultant had to work hard to accommodate both the company’s interests and those of the foundation, was in coordinating the application process and the hiring, training, and retention of new employees. The foundation’s goal was to make sure that people who would otherwise have been left out of the job stream — people who had little information about job opportunities or who had no transportation or child care, or who might have family problems that could interfere with their job performance — could get help both before and after they were hired. For that, the company agreed to create a special office at the mall where people could learn about opportunities, apply for jobs, and get training and family assistance.

In the end, the goals were largely achieved. But there were many rough spots and some disappointments for both sides. The grantmaker and consultant offer these lessons from their experience:

• Don’t assume that support from the CEO is all you need. “We made an assumption,” says the grantmaker, “that because a top executive understood that his company could achieve a social impact and advance its bottom line, the company as a whole shared that vision. That wasn’t so. So one lesson is, when partnering with a particular company, it’s important to have not only commitment and leadership from the top, but also from other people in the company, particularly in the areas of the company that are going to be key to the success of the project.”
• Learn about the company’s business. “It would have helped us to understand the fundamentals of firm’s business model better before we started,” the grantmaker believes. “For example, a key part of their business rationale was that the jobs program would make this mall attractive to retailers, because it would ensure a reliable source of employees at a time when the job market was very tight. We had developed this understanding with the development side of the organization, but in fact it was the leasing group that dealt with retail tenants. If we had known the structure of the leasing agreements, we would have recognized the importance of getting senior managers from those units engaged from the outset.”
• Produce a simple, written summary of responsibilities. “Foundations tend to be more into process, and companies are not,” she adds. “The developer was on an 18-month timeline to get this mall from being a place where there was a sign in the ground to having thousands of square feet and people working in it. So our saying ‘Let’s have meetings, talk about roles, and put together a memorandum of understanding’ would have been a nonstarter. But it might have been useful to draft something and send it to the top executive of the company and say, ‘This is our understanding of what we’re doing together,’ and make sure that the eight or ten people who were involved all got a copy of it.”