Remarks
Eva S. Hardy
Senior Vice President – Dominion
Chamber Goodwill Awards Program
Fredericksburg, Va.
Sept. 28, 2006
"Giving Back to the
Community: Why
Philanthropy Makes Good Business Sense"
Thank you. It’s my pleasure to join you today.
I
want to thank Xavier Richardson for his kind introduction… and for inviting
me to be your keynote speaker.
I recall speaking at a luncheon program
similar to this one a few years ago. When
the program chairman introduced me, he said: "Ms. Hardy is our
only speaker today. When she finishes, we can relax and enjoy ourselves. The
rest of the program is going to be entertainment."
Somehow I don’t
think that was exactly what he intended to say — but
that’s what came out.
I’m quite sure that Xavier’s introduction
didn’t lead anyone
to believe that I am here to entertain, and for that I am grateful.
What I do want
to do is tell you something about the way my company gives back to the community
through the Dominion Foundation… and why
we think corporate philanthropy makes good business sense.
Before I do that,
however, I want to take a moment to thank Woody Van Valkenburgh and Rappahannock
Goodwill Industries.. and Bob Hagan and the Fredericksburg Regional Chamber
for co-hosting this awards program.
Dominion is a long-time friend and supporter
of your organizations. We
appreciate your support of the business community and all you do for the citizens
of East Central Virginia, many of whom are Dominion customers.
In an era tainted
by corporate greed and scandal, good deeds are too easily overlooked. So
when someone shines a spotlight on members of the business community who have
chosen to be good corporate citizens, that is definitely something to cheer
about.
To you award nominees in the audience, I applaud you for
your generosity and community spirit. You are all winners, and you deserve
the recognition you are receiving today.
I know I’m preaching to the choir
when I say to this audience that business philanthropy and community involvement
are good things. But not everyone
agrees with that point of view.
There is a school of thought that believes the
only legitimate purpose of business is the creation of shareholder wealth. A
leading advocate of this view is Milton Friedman, the prominent economist.
While teaching at the University of Chicago in 1970 he wrote: "The
one and only business of business is maximizing profit, playing within the
rules of the game."
Contrast Mr. Friedman’s statement with one
that hangs in the offices of Paul Newman’s food products company, "Newman’s
Own."
It reads: "There are three rules for running
a business; fortunately we don’t know any of them."
Newman’s
food empire donates its profits — somewhere in the neighborhood
of 150 million dollars — to charitable organizations.
At Dominion, we
fall somewhere in between those two extremes. We think
Mr. Friedman’s position is a little too narrow and short-sighted. Mr.
Newman’s doesn’t work for us as an investor-owned company.
I imagine most of you also come down somewhere between those
two points of view — especially since you have chosen to share your resources
with community-based non-profit groups.
Wherever you stand of the spectrum
of opinion regarding philanthropy, I think we would all agree that the rules
of the game have changed over the past 35 years — and they will continue
to change.
Since Milton Friedman made his case for the business of business
being business, more and more companies have realized two things:
First, that maximizing profits and growing shareholder value require a
long-term perspective;
And second, that doing what is "socially responsible"
is not just do-gooder window dressing or slick PR; rather, it is enlightened
self-interest that helps ensure the firm’s long-term viability — without
which there could be no profits or shareholder value whatsoever.
Dominion, for instance, has a fundamental connection to the
community. We
are linked in a very literal way through the pipes and wires that deliver natural
gas and electricity to our customers.
We have a strong local presence wherever
we do business by virtue of the products we sell. They are the lifeblood
of everyday life. We try to strengthen
that presence by being a good employer, a good neighbor, a good community advocate
and a good environmental steward.
For example, because we are an energy company
providing a vital public service, we devote significant resources to EnergyShare,
a program you are probably familiar with. It is Dominion’s fuel
assistance program, and it helps needy families pay their winter heating bills. This
winter will be EnergyShare’s 24th year serving our neediest customers.
Now
let’s focus on the subject of philanthropy — which comes from
two Greek words meaning "love for mankind." Philanthropy
is a very important aspect of the partnerships that Dominion has long nourished
with the communities we serve.
Through the Dominion Foundation, we channel more
than $10 million a year to health and human services providers, community development
groups, environmental organizations and cultural and educational institutions.
The
grants we make go to support food banks, homeless shelters and feeding programs… improve
educational instruction in math, science and technology… upgrade
cultural outreach efforts in the performing arts… and protect valuable
land and wildlife habitat with the help of organizations such as The Nature
Conservancy.
Dominion also has a matching funds program to encourage our
18,000 employees to support eligible cultural, educational and charitable causes.
And
our employee volunteers are some of the best people you will ever meet. With
the full backing of senior management, they donate thousands of hours of time
each year to a broad range of community initiatives — home repair for
the elderly… Habitat for Humanity projects… mentoring with Big
Brothers and Sisters… and March of Dimes Walk-A-Thons, to mention only
a few.
Programs that target children, families and education are
a top priority for our volunteers.
Just last month, a team of Dominion
volunteers from the North Anna Power Station worked with officials at Livingston
Elementary in Spotsylvania to build a greenhouse and butterfly garden on the
school grounds.
Dominion donated $5 thousand toward the cost of the project,
and our volunteers spent one entire day building the greenhouse and landscaping
around it. Now
the school has an outdoor learning center where the kids can picnic – and
learn something while they’re at it.
Education and historic preservation
are closely related, and they are major areas of focus in our corporate giving
program. This is Virginia, after
all.
The Commonwealth’s presidential heritage is extremely
rich, and Dominion has made a point of supporting it. We are providing
significant dollars to help fund educational outreach programs at Mt. Vernon
and Thomas Jefferson’s
Poplar Forest retreat in Bedford County, as well as the ongoing restoration
of James Madison’s Montpelier home.
Here in the Fredericksburg area, we
have provided grants to Kenmore Plantation and George Washington’s Ferry
Farm in Stafford County, where important archeological work is being done.
Just
up the road in Prince William County, Dominion was among the first companies
to come forward with seed money for the new Belmont Bay Science Center. And
we are lending our support to the National Slavery Museum here in Fredericksburg
and to the new Marine Corps museum up in Quantico.
You may have seen the article
that appeared recently in The Free-Lance
Star about a Dominion Foundation grant to Widewater Elementary in Stafford
County. The money will be used to fund an after-school program for
disadvantaged students. It’s part of a competitive educational
grants program that awards $220,000 to schools in six states where Dominion
does business.
Those are just some of the many community initiatives we
are involved with in the Fredericksburg region. We support them because
we know that healthy, vibrant communities are essential to the long-term
success of our business.
That’s also why we are active partners with
local and regional economic development agencies, such as the Chamber of
Commerce and the Fredericksburg Regional Alliance.
Bob Hagan, Gene
Bailey and others are doing a great job of promoting strong job growth in
this area. Gene Bailey, president of the Fredericksburg
Regional Alliance was not able to be here today because he is in China on a
marketing trip. That’s what I call going the extra mile to recruit
new businesses.
New companies bring with them jobs and resources — and
potentially more philanthropic support for the community. You may have
heard about GEICO creating 800 new jobs here… seen the new state Visitor’s
Center under construction along 1-95… and read about the 5,000 to 6,000
new defense-related jobs that will be coming to the region over the next five
years.
Those are all signs of a region that is poised for solid
economic growth. And
when the business community is growing, opportunities to make a difference
in the larger community grow, too.
It boils down to this: Business
philanthropy is fundamentally about building long-term relationships and valuable
linkages with stakeholders.
When the number crunchers who watch over the bottom
line come to me for quantifiable results and hard data — and they always
do, God love them — I challenge
them to put a price tag on the credibility, trust and goodwill we earn by being
active participants in the life of the community.
They usually roll their eyes
at me in dismay. They know they can’t because
credibility is priceless. It simply can’t be measured in dollars
and cents. If they still want to argue about it, I tell them the story
about the big company that shows up in the public arena only when it has bad
news to announce — and there are plenty of real-world examples to draw
from in the energy industry… pharmaceuticals… tobacco… on
and on.
Those companies shouldn’t expect to be greeted with
open arms or a warm reception from the community. They will learn, sooner
or later, that there are real costs to be paid for poor or non-existent community
relations — things
like higher legal fees… lower customer satisfaction… or costly
new regulations and laws governing their business, not to mention the negative
media coverage they will receive.
At that point, the number crunchers typically
shrug their shoulders and go back to their profit and loss statements, hoping
not to see me again until the same time next year. Or not.
Please don’t
get me wrong. I fully embrace shareholder value as
a necessary and fundamental objective of business. My CEO would fire
me if I didn’t. But it is not a sufficiently comprehensive worldview
for the complex times we live in.
Dominion’s customers, for example,
want all the modern bells and whistles: 24-hour,
7-day-a-week customer service… perfect power quality and reliability… web-based
services and technologies… automatic meter reading.
But they also seem
to want the old-fashioned utility — the company that
supports the local YMCA capital campaign and buys lunches for the Monday get-together
of the Chamber of Commerce.
We can do both — and we do. It’s
what our customers expect. It’s
part of what I call the implicit "social contract" that exists
between business and society.
This contract has obligations, opportunities
and benefits for both sides. It’s
not written in law anywhere but that doesn’t make it any less powerful. It’s
part of America’s collective psyche and shared history, if you will.
Experience
has taught us that governments cannot fund all the social programs our citizens
need and want. Nor can individuals. There simply aren’t
enough Bill Gates’ or Warren Buffetts around to do the job.
That leaves
business to fill in the gaps. And modern society has come
to expect the business community to respond when social problems remain unresolved.
Companies
that turn a deaf ear to society’s call for help become vulnerable
to attack. They are actually putting millions or even billions of dollars
of shareholder value at risk, as I alluded to earlier.
In my view, businesses
that adopt a long-term perspective and understand the value of sustained community
involvement and investment are the ones that will gain strategic advantage
and do the best job of protecting shareholder interests.
I leave you with the
words of our 35th president, John F. Kennedy, who said: "If
we who have cannot help those who have not, then we cannot help ourselves."
That’s
the best, most succinct description of enlightened self-interest I’ve
ever heard. It’s what business philanthropy is all about.
Once again,
my thanks and best wishes. Keep giving to your community. It’s
good business — and it’s the right thing to do.
