The capital of corporate philanthropy
My philanthropic tour of Minneapolis began on the banks of the Mississippi River, where the Great Northern Railroad once transported grain from the giant mills of General Mills and Pillsbury. The Great Northern is long gone - merged into the Burlington Northern almost 40 years ago - and though the mills are still standing, they have long since been converted to other uses, as General Mills moved to the suburbs and, in time, acquired its rival Pillsbury.
Bill King, the head of the Minneapolis Council on Foundations - and my tour guide - pointed out the mills as we got into our car. As well he should have. One of the lasting legacies of the Great Northern is the Northwest Area Foundation, which was founded by James Hill, the Great Northerns founder. As of March 2007, it had $500 million in assets, and is devoted primarily to anti-poverty efforts. Minneapolis and St. Paul have an abundance of foundations that were started by the founders or top executives of many of its biggest companies, like 3M and Target.
General Mills, meanwhile, was an early member of an organization begun in the mid-1970s called the Five Percent Club: Minneapolis-St. Paul corporations agreed to set aside 5 percent of their pretax income for philanthropy. Believe it or not - and it is a little hard to believe, given the modern emphasis on maximizing profits and pleasing Wall Street - the club still exists. Now known as the Keystone Club, it has 214 members, 134 of which donate at the 5 percent level. (The others give away 2 percent of their profits.) Last year, General Mills donated more than $57 million, second only to Target, which gave away nearly $160 million.
“Heres the new Guthrie,” King said as we began the tour. The Guthrie Theater, the citys fine regional theater, recently moved into a sparkling new building by the river - one of five major arts organizations that have recently built new buildings or major additions. All of them were built, in no small part, with corporate donations.
We drove a little further. “This is where the bridge collapsed,” he said, pointing directly in front of us. He was speaking, of course, of the 35W bridge, which collapsed in August.
“When it fell, there was an immediate response from corporations,” King continued. “And a fund for victims was set up by the Minneapolis and St. Paul Foundations.”
The latter groups solicit donations from local people who want to be involved in philanthropy but lack the means to set up their own foundations. Combined, the two foundations have over $1.5 billion in assets, and are major forces in the Twin Cities.
We entered North Minneapolis, a low-income neighborhood, and drove past a storefront that said, in bright lettering, “The Cookie Cart.”
“This is a cookie business that is run by kids in the community,” King said. “It helps them learn skills that can really be useful. It has been around for 10 or 15 years.” It is largely corporate-sponsored. As we neared a school, King told me about a Medtronics-funded program that began as a $75,000 pilot program to help kids get interested in science. It has since become a $5 million, five-year program. And on, and on.
Ask anybody in the world of corporate philanthropy and theyll tell you: Minneapolis-St. Paul is like no place else, a bastion of giving in an age when most companies are cutting back. “It is an unusual city in regards to corporate giving,” said Robert Reich, a former U.S. labor secretary.
Back in the 1970s, John D. Rockefeller III said in a speech to the Minneapolis Chamber of Commerce that he had heard so much about “the public spirit of its business community, about your remarkable Five Percent Club, that I feel a bit like Dorothy in the Land of Oz. I had to come to the Emerald City myself to see if it really exists.”
So did I. And sure enough, it does exist. But why here?
If you ask this question to people in Minneapolis, you hear all kinds of theories. “When you live in such a harsh climate, you understand the need for the common good,” said Emmett Carson, the former president of the Minneapolis Foundation. Others suggested that the areas corporate generosity grew out of the Scandinavian culture that took hold in this region, with its deep Lutheran roots.
Christina Shea, the senior vice president of external relations at General Mills, thought it had to do with enlightened self-interest. “How do you attract high-powered talent?” she asked. A large part of the answer, she believed, had to do with building communities in which talented people wanted to live. Steve Rothschild, a former General Mills executive who left the company to found an anti-poverty group called Twin Cities Rising, said he thought that Minneapolis-St. Paul companies had long viewed their responsibilities broadly. “Most Twin Cities companies have a stakeholder model, not a shareholder model,” he said. There is probably some truth to all the theories.
