Corporate and Family Philanthropy The case of the Th

Corporate and Family Philanthropy
The case of the Th. Schmidheiny family
Fourth Invitational Conference on Family Business
Dr. h.c. Thomas Schmidheiny
Charity vs. philanthropy in the narrower sense
My remarks today are about philanthropy in the narrower sense,
not about charity.
Philanthropy in the narrower sense:
Not "only" giving, but:
• Having a giving strategy
• Aiming at a long-lasting ("sustainable") impact
• Demanding accountablility of the recipients
• Transparent giving
Charity:
Unconditional giving, mostly in cases of emergency. No sustainability,
no learning-curve.
1
Corporate and private philanthropy
Different, but with the same roots
2
In the beginning, there is the entrepreneur family – company and family
are "one"
Traditionally, a lot of entrpereneurs in Switzerland
have assumed also public functions:
For example Max Schmidheiny, my father:
• Not only leader of the family entreprise
Hoderbank/Holcim
• But also active in politics (local, cantonal and
national level) and officer in the Swiss Army
Personal responsibility and accountability of
the entrepreneur family is the root.
3
Today: Separation of corporate and private philanthropy
Different purposes, rooted in the same values of the business founders
Corporate
philanthropy CSR
Private
philanthropy
Joint
initiatives
• Strategic
• Philanthropic
• Aligned to business
• Aligned to family values
• Economic "licence to
operate"
• Societal reputation,
personal responsibility
• In line with all
shareholders' interests
• Free from shareholder
interests
4
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
5
Holcim is one of the world's leading suppliers of cement and
aggregates – founded in Holderbank in 1912
• Global Group with operations on all continents in over 70 countries
• Significant presence in emerging markets – especially Asia and Latin
America
• ACL and Ambuja Cement being part of it
• As of per year ending 31 December 2012 (E), Holcim had



Net sales of CHF 21.7 billion
Operating EBITDA of CHF 4.2 billion
Net income CHF 1.1 billion*
* Net of write-offs
Source: Consensus Bloomberg
© 2012 Holcim Group Support Ltd
6
The Group's strategy is based on three pillars
Product Focus
• Two basic resources
►
►
Cement
Aggregates
• Value-adding products
and services
►
►
►
Ready-mix concrete
Asphalt
Concrete products
Geographic
Diversification
Local Management
Global Standards
• Truly global
• Balanced between
►
►
• Business strongly
anchored in local
markets
• Supported by
global standards
Regions
Mature / emerging markets
►
►
Net sales1
Europe
North America
1
Op. EBITDA1
Policies & directives
Exchange of
know how &
best practices /
benchmarking
Latin America
Africa Middle East
Asia Pacific
Reported as per 12M 2011 YTD
© 2012 Holcim Group Support Ltd
7
Sustainable Development is a key element of Holcim's
vision, mission and strategy
Vision: We want to provide foundations for society's future.
Mission: We want to be the world's most respected and attractive
company in our industry – creating value for all our stakeholders.
Holcim Strategy House:
© 2012 Holcim Group Support Ltd
8
Holcim's CSR engagement is strategic
Holcim defines CSR as:
Our commitment to work as partners with all our stakeholders to effectively
improve the quality of life of the members of our workforce, their families and
the local communities around our operations.
The CSR Policy is based on 6 pillars:
1. Business Conduct
2. Employment Practices
3. Occupational Health and Safety (OH&S)
4. Community Involvement
5. Customer and Supplier Relations
6. Monitoring and Reporting Performance
© 2012 Holcim Group Support Ltd
9
Social responsibility at Holcim focuses on four main areas
Building capacity of people
and organizations
through engagement
and investment
© 2012 Holcim Group Support Ltd
10
Holcim's social engagement is sustainable and linked to the
core business
Building human capital:
"Give a man a fish and you feed him for a day. Teach a
man to fish and you feed him for a lifetime."
Social investment:


Holcim currently spends double digit millions on
community initiatives, donations and in-kind support.
The largest part of the budget is invested in the Holcim
focus areas of community development, education and
infrastructure:
Overheads
20.25%
Over 3 million people
benefited directly from Holcim's
social engagement in 2011
Community
Development
21.64%
Donations
20.91%
Others
2.57%
Infrastructure
20.27%
Education
14.36%
© 2012 Holcim Group Support Ltd
11
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
12
Healthy Business; Healthy Community
Presentation to ACL Board By Pearl Tiwari
22nd April 2009
Energise • Involve • Enable
13
ACF's Outreach
Benefited
• 21 locations
• 12 states
• 1.5 million people
• 928 villages
Energise • Involve • Enable
14
Stakeholders
•
Investors
•
Customers
•
Supply Chain
•
Employees
•
Community
•
Government
•
Civil Society / NGOs
Energise • Involve • Enable
Budget
Ambuja Cement Foundation's total budget
for 2012-13 is Rs. 610 million (appr. USD 11,1 million)
Income: Ambuja Cement's share –
Rs. 360 million (appr. USD 6,6 million)
Energise • Involve • Enable
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
17
Fortaleza. Desempeño. Pasión.
CECAF – Farming and Forestry Training Center
Holcim Apasco - Mexico
CECAF, Holcim Apasco - México, CJL, 2013-01-22
© 2013 Holcim Ltd
Lesson learnt in Mexico or: our "magic formula"
Ever since we started our operations in Mexico, the plant manager had the
social activities of the company as a core responsibility.
Lesson learnt:
In order to make social responsibility activities really sustainable – it must be
made a key responsibility of the top management.
© 2013 Holcim Ltd
19
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
20
Corporate and private philanthropy
Different purposes, rooted in the same values of the business founders
Corporate
philanthropy CSR
Private
philanthropy
Joint
initiatives
• Strategic
• Philanthropic
• Aligned to business
• Aligned to family values
• Economic "licence to
operate"
• Societal reputation,
personal responsibility
• In line with all
shareholders' interests
• Free from shareholder
interests
21
The family's philanthropic strategy (1/3)
Our family values
Family
Philantropy
Entrepreneurship
Integrity
Live-long
learning
Individual
responsibility
22
The family's philanthropic strategy (2/3)
Our philanthropic interests
Help for selfhelp
Art
Education
Individual /
social
development
Innovation
Economic
literacy
Entrepreneur
ship,
liberalism
23
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
24
The foundation portfolio of the Th. Schmidheiny family
A historically grown portfolio of charitable foundations
atDta Foundation
Help for selfhelp
Art
Foundation
Art Collection
Th. Schmidheiny
Education
Ernst Schmidheiny
Foundation
Individual /
social
development
Innovation
Entrepreneur
ship,
liberalism
Foundation FUTUR
Economic
literacy
Max Schmidheiny
Foundation
25
atDta-Foundation Help for Self-Help
Purpose:
Fostering the ability of humans to help themselves
Type of foundation: Grant giving foundation
Annual commitment: 2011 - CHF 1,4 million (appr. INR 83.628.300)
Study grants
to individuals
Grants to NGOs
51%
51%
49%
49%
• Development projects:
Education, food security,
hygiene, microcredits
• Cultural and social projects in
Switzerland
26
Ernst Schmidheiny Foundation
Purpose:
Type of foundation:
Fostering economic literacy among young people, mainly in
Switzerland, but also in Germany and the Philipines
Operative foundation (own projects only)
Main project: "Economy weeks":
• High-school students take over
management of virtual companies for
one week
• Leaders from the Swiss business
community volunteer as their business
coaches and economics teachers
• 50% of Swiss grammar schools take part
• Network of 500 volunteering leaders
• 100'000 graduates so far
27
Max Schmidheiny Foundation
Purpose:
Type of foundation:
Promotion of a free economic and social order (advocacy)
Operative foundation (own projects only)
Main project: Max Schmidheiny Fora
• Creation of a platform for young leaders from
the spheres of politics and business
• Promotion of a dialogue and a new network
between politics and business, learning from
each other
• Debate of issues relevant for the future of
Switzerland
28
Foundation FUTUR
Purposes:
Type of foundation:
1.) Promotion of start-ups from the local university of applied sciences;
2.) Promoting the exchange between young entrepreneurs and young
artists
Operative foundation (own projects only)
Main project: Herrenberg – a home for startups and young artists
• Business incubator (18 companies so far;
over 120 permanent jobs created)
• Artist residencies with graduates from J.J.
School of Art, Mumbai, India (10 alumni so
far)
• Art workshops in Mumbai for JJ graduates as
part of the selection process
The medieval Herrenberg building
29
Foundation Art Collection Thomas Schmidheiny
Purposes:
paintings
Type of foundation:
Preservation and making public of the outstanding collection of
by the Swiss artists Ferdinand Hodler
Operative foundation (own projects only)
Activities
• Loan of art works to museums world wide
• Preservation of the art work
• Fostering of publications on the Swiss artist
Ferdinand Hodler (1853-1918)
30
Content
1. Corporate Philanthropy: Holcim's CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family's philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
31
Philanthropic investments into selected academic institutions
Why making philanthropic investments in academic institutions?
•
Fostering cutting edge research and/or education in relevant topics
•
Help to build up new degree programmes, new areas of research
•
Personal pleasure: intellectual stimulation; fruitful encounters with
intriguing persons, personal confrontation with the next generation
•
Synergies with asset management
32
Philanthropic investments into academia: ISB!
Thomas Schmidheiny Chair of Family Business
and Wealth Management
The Thomas Schmidheiny Chair of Family Business and Wealth Management was
set up in the year 2006 with funding and support from Dr Thomas Schmidheiny of
Spectrum Value Management. Led by Professor Kavil Ramachandran, the Chair
offers extensive research on family governance and leadership, professionalisation,
and entrepreneurship in family business.
33
Philanthropic investments into academia: Tufts University – Fletcher
School
• Facilitating the Center for Emerging Market Enterprises
• Fostering the new degree programm Master of International
Business (MIB)
• Thomas Schmidheiny Professor of International Business
34
University of St.Gallen, Switzerland – Max Schmidheiny Chair for Law and
Economics
• Initiation of the Max Schmidheiny Chair in Law and Economics
at the renowned University/Business School of St.Gallen:
Bringing Prof. Dr. Anne van Aaken to St.Gallen (young
professor with international reputation)
• Fostering the new degree programm Master of Law and
Economics (MLE)
35
Content
1. Corporate Philanthropy: Holcim’s CSR
1.1. Overview
1.2. India: The case of Ambuja Cement Foundation
1.3. Mexico: The case of Apasco
2. Family Philanthropy
2.1. The family’s philanthropy strategy
2.2. The foundation portfolio
2.3. Direct investments into academia
3. Lessons learnt
36
Lessons learnt (1/5)
Treat philanthropy as an integral part of your asset management.
Philanthropy should be in harmony with the the values of your family.
37
Lessons learnt (2/5)
Philanthropic money is always limited.
The hardest task of philanthropy is to find intelligent levers.
I am convinced that the support of education – academic and vocational
is one of the best philanthropic levers.
38
Lessons learnt (3/5)
Keep control over your foundation(s).
There is no need to make one large endowment once - rather give regularly
to your foundation according to its actual need and its performance.
39
Lessons learnt (4/5)
Quality over quantity (1):
Rather change one life fully than sprinkle benefits over a large number of people.
Key is always "help for self-help". Facilitate and demand a learning curve of your
grantees.
40
Lessons learnt (5/5)
Quality over quantity (2):
Accompany your projects. Dedicate time - your time and/or other human
resources - to your projects.
41
THANK YOU VERY MUCH!
42
Lessons learnt (1/5)
Treat philanthropy as an integral part of your
asset management.
Philanthropy should be in harmony with the
values of your family.
43
Lessons learnt (2/5)
Philanthropic money is always limited.
The hardest task of philanthropy is to find
intelligent levers.
I am convinced that the support of education –
academic and vocational – is one of the best
philanthropic levers.
44
Lessons learnt (3/5)
Keep control over your foundation(s).
There is no need to make one large endowment
once – rather give regularly to your foundation
according to its actual need and its performance.
45
Lessons learnt (4/5)
Quality over quantity (1):
Rather change one life fully than sprinkle benefits
over a large number of people.
Key is always "help for self-help". Facilitate and
demand a learning curve of your grantees.
46
Lessons learnt (5/5)
Quality over quantity (2):
Accompany your projects. Dedicate time – your
time and/or other human resources – to your
projects.
47