The Role of the Corporate CEO: Then and Now

by Stanley Karson
Former President
Center for Corporate Public Involvement

Unless and until the purposes and goals of corporate community involvement are clearly stated by the CEOs of American businesses, the foundations for a new corporate-nonprofit partnership will be shaky at best. To reach this point, top corporate executives must first agree on the philosophical underpinnings of their relationship to the society in which they conduct their businesses. One notable effort a few years ago may be instructive. 

In the fall of 1991, almost 100 chief executive officers of the nation's insurance companies met for two days in Washington to review their industry's twenty-year record of corporate public involvement. Among other national leaders of the public, private and nonprofit sectors, Brian O'Connell, then president of INDEPENDENT SECTOR, lauded the industry's program as a "role model for other trade and industry associations...The need has never been greater for the business sector's active involvement with the voluntary sector in addressing key social issues facing our nation."

Those trying to come up with effective strategies for corporate community involvement today may note with interest the subjects of the CEOs' breakout sessions almost a decade ago: 

• translating the CEO's corporate public involvement commitment throughout management;
• strategic planning: maximizing corporate objectives through effective use of corporate public involvement;
• tackling tough issues: knowing when to take the lead on social/economic problems; and
• social and community issues of the 1990s: priorities for the company and the industry. 

Plus ca change? Yes, and no. The basic challenges are the same or similar. But, the changes in the very composition of corporate America (read globalization, mergers and high-tech) make for new complications and complexities as we wrestle with corporate-nonprofit partnerships in the new millennium. While the mega-billionaires have discovered the joys of philanthropy, corporate giving as a percentage of net income still hovers around one per cent. While corporate foundations are more and more professionally staffed and accountable, they remain at the mercy of mergers and acquisitions. 

Which brings us back to the need for leading business executives to enunciate in common the basic principles for their community involvement. One unique, but largely unheralded, effort to set down the guiding philosophy for a major industry came as a direct result of the 1991 CEO conference. Motivated by that meeting and its intense discussions of the essence of corporate public involvement, insurance industry leaders shortly thereafter crafted the following Declaration of Interdependence Between the Life and Health Insurance Business and its Communities: 

This Declaration was approved by the boards of directors of the two major insurance trade associations, the American Council of Life Insurance and the Health Insurance Association of America, early in 1992. Before the end of that year, a number of companies had through their boards of directors or senior management action formally adopted it as their own. How many of the 600 plus companies belonging to the two associations follow these principles today is not known, certainly not by me, since I retired as director of the industry's Center for Corporate Public Involvement several years ago. (For all practical purposes the 23 year old Center program no longer exists under new association management). 

Yet, the lessons of the effort, lasting over two decades, ought not to be overlooked by those revisiting business-nonprofit partnerships. Indeed, they might well serve as prologue. The most relevant: 

• like all important management policies, goals and guidelines for corporate community involvement must bear the imprimatur of the CEO. The emergence of dedicated company and foundation staff is a most welcome and necessary development, but only the commitment of the CEO and senior management can assure stability for the program, not to mention acceptance at all levels of the business;
• bringing like-minded, or at least open-minded, CEOs together to articulate principles and policy for community involvement is vital early on, and on a continuing basis. Peer pressure works—even, or especially, at that level;
• industry-wide programs—with designated, credible staff and resources—help greatly, because they provide both a sense of comfort and competition;
• communicating and monitoring company programs are necessary to stimulate new strategies and to evaluate progress;
• corporations, like people, and CEOs (also like people) thrive on positive recognition. Local and national awards, on an annual basis, for performance to society in general or to a community in particular serve to highlight not only the company or CEO but, even more important, the value the public places on corporate community involvement. Caveat: Awards must be devoid of commercialism, based purely on merit and above reasonable reproach;
• it is tempting, certainly easier, to work mainly with the corporate cheerleaders, the usual suspects for social responsibility, than with the larger, maybe more mainstream businesses and their CEOs. But, if the latter come to view community involvement as a process being pushed by business mavericks, no matter how noble, or by fringes on the corporate left, acceptance and progress will be slow. In short, the recognized, visible, economically successful leaders of American business must be relentlessly pursued as potential partners, no matter how rocky the road. Once committed, they can be a potent force to recruit more skeptical executives; and
• finally, and of overriding significance to INDEPENDENT SECTOR members, is a lesson I learned early on: No partnership is worth its name if each partner does not participate in give-and-take. Even as the public and nonprofit sectors have been subject to counsel and criticism over time, so do those partners in the process need to go after the corporate sector when necessary. 

The American consumer can and should be a voice, an instrument, to promote corporate community involvement. But, the reality is that most citizens have not yet been adequately informed of that need, nor do they understand their clout to move American business along the path of social responsibility. 

Concluding on a personal note, it is only fitting that INDEPENDENT SECTOR members recall the insurance industry's pioneering program from the 70s to the early 90s. For John Filer chaired both IS and the Center for Corporate Public Involvement during some of those years. As Aetna CEO, he provided the vision and the skill to guide both the nonprofit and the corporate sectors to respond more creatively to the needs of society. He was my friend and mentor until his untimely death in 1994. 

Other John Filers are out there, of this I am sure. They are indispensable to the success of the Corporate-Nonprofit Partnership Initiative.

Stanley G. Karson. Until 1995, Stanley Karson headed the Center for Corporate Public Involvement since its inception in 1972. The Washington-based Center, funded by two major insurance associations, was the only industry-wide program in American business focusing on corporate social responsibility. He continues to work with both the profit and non-profit sectors to promote effective partnerships between the two. 

In his 23 years with the Center, he worked with hundreds of CEOs and other officers of insurance companies to encourage and enable their support of such issues as education, the elderly, employment, health and wellness, housing, hunger and the homeless and HIV-AIDS. The Center's magazine, Response, and its annual Social Report chronicled creative and successful corporate community projects and provided data on cash contributions, social investments and voluntarism. 

Over the years, Mr. Karson has spoken extensively on corporate community involvement around the nation and abroad. He has been featured in most major U. S. dailies, and he has written numerous articles promoting business-community partnerships. Currently, he serves on the boards of Partnership for Prevention, the National Retiree Volunteer Coalition, Corporate Philanthropy Reports, Wellness Councils of America, and Business/Labor Responds to AIDS of the Centers for Disease Control. He received an honorary doctorate degree from Benedict College for his leadership with the College Endowment Funding Plan which leveraged over $120 million for traditionally Black colleges.

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