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GreenMoney Journal - publishing since 1992
Fall 2010 issue
Socially Responsible Investing – Better Companies, Better Communities
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Organization Profile: 1% for the Planet
by Terry Kellogg
BACKGROUND: As we all know, charitable giving was hit hard in 2008. With few exceptions,
foundations cut giving commensurate with their own loss in assets; they refused to evaluate new
recipients, or they froze giving altogether. Similar trends emerged among individual donors. The
early read is that giving from the 1% for the Planet network will buck this trend since the
organization continues to set growth records and donations tied to sales are more insulated from
movements in the financial market. It's worth a moment or two of reflection on how this all came
about.
1% for the Planet exists to build and support an alliance of businesses financially committed to
creating a healthy planet. We are a rapidly growing global network of companies that donate one
percent of sales to organizations working on sustainability worldwide. And we are a brand that
engages and inspires a powerful citizenry to make informed choices as consumers.
Here's
how 1% for the Planet works: we license the 1% for the Planet trademark for use by member
companies. Members give directly to the organizations they choose; money does not pass through 1%
for the Planet. Members pay annual dues (part of their one percent) based on revenues. We certify
that member companies annually meet their one percent commitment. We maintain a database of
recipient organizations that are eligible to receive contributions.
Patagonia broke ground
in the 1980's when it committed ten percent of its profits to environmental causes. 1% for the
Planet grew out of the realization (on the part of Patagonia founder, Yvon Chouinard) that a
company's pledge to give a percent of profits doesn't go far enough. It's a hedge: if the year goes
well and there's something left over, after we spend money on what really matters, then we'll do
some giving. A commitment built around a percent of sales ensures that said commitment is truly
baked into the company's DNA because it's part of every transaction that company engages in. What's
more, it's transparent: it's easier for a consumer to recognize, and act on. Finally, a commitment
around a percent of sales holds in both good times and bad.
OUR HISTORY
Chouinard launched 1% for the Planet together with his fishing buddy Craig Mathews at a
low-key event at a Patagonia store in San Francisco. The concept was: since we share a commitment
to donate a percent of sales, and our businesses are thriving in part because of it, wouldn't it be
great to inspire others to do the same.
Participation in 1% for the Planet grew slowly at
first, mostly by word of mouth, primarily on the West Coast of the United States and in outdoor
industry circles. The trajectory changed in 2005 with the release of Jack Johnson's (our fiftieth
network member) album In Between Dreams. Also in that year, Yvon Chouinard released a book "Let My
People Go Surfing" that culminated with the story of 1% for the Planet. Since then we have received
coverage on most major news networks in the US and in a wide range of publications around the
world. The impact has been profound.
Since 2005, our member companies have increased from
92 to over 1,000. And for two years we have added more than one new member company a day.
Membership now consists of companies in 37 countries. Together we give over $10 million annually to
more than 1,600 environmental groups worldwide. To date, 1% for the Planet has initiated over $42
million in environmental giving. Through our network, we reach millions of consumers.
The
1% for the Planet network is poised to not only become the largest single funder of environmental
causes, but also an influential community of businesses, non-profits and consumers committed to
environmental responsibility.
FUNDING
Environmental causes
received less than one percent of the total US philanthropic giving in 2006. Of that total,
corporate philanthropy accounted for less than four percent, or about one tenth of one percent of
their sales. The 1% model is well suited to the challenge of changing those statistics so that real
and present dangers are met with more adequate funding and that the potential of corporate giving
is more fully realized.
Our member companies give directly to the organizations of their
choice. 1% for the Planet does not serve as an intermediary in this process, but we do certify
their annual one percent contribution and ensure that their donations go to organizations that are
legal charities with an environmental focus. In 2006, 42 percent of our member contributions to
NGOs were gifts of $10,000 or more.
These donations primarily supported nonprofits
engaged in conservation and preservation work. They also went to organizations involved in
advocacy, legal defense, environmental health, research and education, leadership development, and
civic engagement. Examples of these nonprofit recipient organizations include Canadian Parks and
Wilderness Society, Conservation Alliance, Environmental Defense Center, LightHawk, Natural
Resources Defense Center, Oceana, Pesticide Action Network, Nevada Wilderness Project, Northwest
Institute, Sage Centre, Sierra Club, RARE, and Yellowstone to Yukon.
IS CORPORATE
PHILANTHROPY A DATED NOTION?
Sometimes we hear people talk as if investments in
greening internal business practices should take precedent over "giving money away." We agree that
it is imperative for businesses to make the changes they are capable of to improve the
sustainability of their operations. But we also understand that options for affecting truly
meaningful change are limited. Many companies are enticed by low-hanging fruit only to find that
systemic change is out of reach.
The relevant questions for a company to ask are: what are
my options for affecting change? And which of these options can advance our strategic interests?
Through this lens, investing in non-profit organizations has long been and will remain a powerful
strategic tool for companies that are smart about how they make such investments. After all, it's
the work of activists and non-profits that has led to most of the significant changes we've seen in
attitudes and behavior around the environment. Projecting into the future, it's unlikely that this
mechanism will fundamentally change.
IN CLOSING
The time is
right for 1% for the Planet because businesses have never been more aware of the connection between
environmental and economic sustainability. Many businesses are actively engaged in figuring out how
to make a positive difference. Corporate philanthropy matters to employees, shareholders and
consumers; it creates value and helps companies strengthen relationships.
Consumers want
to support responsible businesses - specifically those that are helping the environment. In a
recent global survey, consumers say that a corporation's performance in addressing the problems of
the environment and climate change affects not only how much they trust the company but also
whether they would buy its products.
The 1% for the Planet brand is a simple and effective
way for the public to understand a company's commitment. And it leverages giving by carrying the
message of environmental responsibility to the company's sphere of influence (employees, board
members, suppliers, customers, consumers and the public at large). This message, in turn, educates
and inspires those in this sphere to take positive action on behalf of the environment with their
purchasing power, at their places of employment and in their daily living. The impact of giving one
percent of sales is exponential.
Our success will add significant new funding to the
environmental field, help prove that environmental responsibility is good for business and growing
the base of consumers that engage in sustainable consumption.
For more information go to
http://www.onepercentfortheplanet.org
Article by Terry Kellogg, CEO, One Percent for the
Planet. Contact him at terry@onepercentfortheplanet.org
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