By Wendy Leibowitz. Thirty-five dollars per house does not, at first, sound like a weighty chunk of change. But for Centex Homes and The Nature Conservancy, it sure adds up quickly. Since April 1999, for every house Centex builds and sells it has donated $35 to The Nature Conservancy (TNC), an Arlington, Va.-based non-profit founded by ecologists to preserve nature sanctuaries, plants, and animals. Just after the close of its fiscal year this past April, with home sales up 80 percent since the start of the relationship, the Dallas-based builder announced that its contributions to TNC had reached $3 million.
Given the rocky relationships between big builders and many environmental advocacy groups, the partnership between Centex and TNC might not look like such a natural fit. But look again. What began as an effort to expand Centex's efforts to serve a greater good and TNC's desire to support responsible land development has turned out to benefit both organizations -- though not without some bumps along the way.
The partnership between Centex and TNC began modestly in the spring of 1999. Centex asked The Point Group, a consulting company in Dallas that had been working with the builder on communication issues, to develop a deeper corporate-giving strategy.
"Land, Home, People," was the driving theme for Centex, recalls N. Scott Jones, The Point Group consultant who worked with Centex. "We [Centex] had the people: Centex has a one million dollar endowment that provides scholarships to kids who are pursuing careers in home building. We had the homes. Centex is a cornerstone partner with Habitat for Humanity," a non-profit that builds houses for and with the underprivileged. "We needed the 'land' part."
Centex's Neil Devroy, vice president of communications and public affairs, recalls the search: "We decided to look around for a national, U.S. non-profit agency that was a leader in giving back to the land. The Nature Conservancy emerged as the largest conservation organization that preserved land and eco-systems." It helped that Centex's president and COO, Tim Eller, then the CEO of the home building unit, served on the state board of trustees for TNC in Texas and expressed interest in exploring a broader relationship with the non-profit, Devroy added.
That resulted in a series of meetings in Texas and Washington, D.C., not only to "determine ways to work together," recalls Devroy, but also to make sure a potential relationship was a mutual fit.
TNC wanted to review how Centex conducted its business and land development to make sure that the builder operated in a way that was consistent with TNC's values regarding land preservation. Centex wanted to review TNC's operations to ensure that the corporation's money would be used directly to help preserve land. Devroy said he believes that deciding points for Centex were TNC's non-confrontational approach to working with business, as well as its use of corporate investments. The dollars donated to TNC "actually go on the ground for land preservation," he says. "TNC gets measurable results, actually preserving habitat."
At first, Centex wanted to focus its involvement on Texas, but TNC was interested in a national commitment from the start. Centex agreed, but signed a one-year commitment, with an option to renew. At the end of the first year, Centex signed on for two more years. The builder is now in the first year of a three-year contract.
Making it Work
Finding the best way to communicate Centex's public service commitment wasn't obvious. At first, Centex gave a free membership in TNC to everyone who bought a new Centex home. Pamphlets in the new homes promoted TNC to those who might not have heard of the organization, and Centex, which hoped to increase its reputation as an organization working to preserve the environment.
But that effort proved bumpy for both organizations and was soon abandoned. The administrative costs of administering the membership were high, according to Centex's Devroy. And it didn't work well for TNC, either, recalls Nigel Homer, TNC's associate director of corporate partnerships, who has worked closely with Centex. "The downside of giving a free membership is that it's a tougher proposition to get members to renew," says Homer. "People didn't pay to begin with, so why should they pay to renew?"
That's when a new approach was developed where Centex directly supported TNC's conservation programs to make a simple donation for each house built and sold. The $35 per-house figure was both organizations' best guess as to how much it costs to preserve one parcel of land around the world, based on the volume Centex was producing that year, says Devroy. By tying the financial contribution to each home built and sold, Centex lets its employees know that "this is not some faceless amount of money being given from some corporate account somewhere. It flows directly from their efforts out in the field," says Devroy. Posters in model homes and regional offices state that Centex is a proud supporter of the TNC, and follow-up direct mail to new home buyers thanks them for their purchase and explains the $35 contribution. "But we certainly don't expect people to buy a home because of our $35 contribution," laughed Devroy.
Indeed, assessing the benefits of this kind of program isn't easy for a builder that measures almost everything else. "If anyone expects to tie home sales to involvement with [a non-profit], they will be sorely disappointed," says Jones.
Centex Homes' $35 per-home donation program to The Nature Conservancy has resulted in $3 million in support for a variety of projects including land purchases and the construction of learning centers and walking trails in Texas, Florida, and Maryland. Among them:
But in customer satisfaction surveys, Centex asks what customers think about the partnership with TNC. There is 96 percent customer support, Jones reports. "Over the long haul, that affirms the sale and affirms the brand," he says, and helps answer the question, "Is this a quality brand that you want to do business with?" A potential new bump occurred, ironically, days after Centex's donation announcement. In a turn of events, TNC came under fire when The Washington Post published a stinging three-part series criticizing some of TNC's practices. The investigative report shook the image of the quiet, cooperative environmental organization that prided itself on its scientific research; its non-confrontational stance toward development; and its history of working responsibly and quietly on reputable building projects with corporations and government bodies.
Devroy, however, said the articles would not shake the Centex-TNC partnership. The Post, says Devroy, "mentions a half dozen problems, not the thousands upon thousands of successes. We will continue to support [TNC] enthusiastically." TNC responded forcefully to The Washington Post in print, on television, and on its Web site, www.tnc.org and said it would devote its June board meeting to revisiting some of the practices criticized by the newspaper.
As TNC has educated Centex on environmental issues, Devroy says he hopes the partnership will help educate the public, including those who are not buying homes. "One of the things that the public doesn't understand is that home builders don't build where we want to build," says Devroy. "We build where we're permitted to build, literally and figuratively." Partnering with TNC may help Centex work with neighborhoods to be allowed to build there, he says.
But there's a paradox at the heart of every philanthropic endeavor, he adds. "The more that you do, the more visibility you get, the more expectations are raised from all kinds of different quarters that you have to be able to deal with."
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