For 35 years, I have delivered a Thanksgiving address to family and friends. My addresses have examined a wide range of themes, including “friendship,” “gratitude” and “family,” topics befitting Thanksgiving. Last year, I fashioned my remarks around the theme of “legacy,” both personal legacy — what we are bestowing to our children — and generational legacy — what the Baby Boomer generation is leaving behind. In my Directors & Boards Letter from the Chairman last winter, I evaluated the Boomer legacy in terms of advances and setbacks to corporate governance.
This year, my address focused on the theme of “service” — service to our nation, our community and our faith, which requires some amount of self-sacrifice, some commitment of personal time and some degree of altruism. Service encompasses a broad range of community engagement, including disaster recovery, conservation efforts, education, health care, senior citizen assistance and military service. Volunteers serve in schools, food banks, homeless shelters, health clinics, youth recreational centers, veterans facilities, and other nonprofit and faith-based organizations. Whether helping rebuild flooded communities, providing after-school tutoring or supporting conservation efforts, volunteers not only learn about their country and contribute to their community, but also gain meaningful experiences and get valuable training.
Since our nation's founding, service has been the hallmark of the American ethos. In the 1830s, Alexis de Tocqueville observed and praised America's spirit for voluntary association, which had “the effect of extending democracy beyond the scope of elected offices to the level of people who share a common purpose and strive for the public good.” Tocqueville viewed the proliferation of associations as a unique American response that was crucial to the success of the American democratic experiment by “providing for the well-being of all of its citizens in accordance with a sense of equality.” Service was at the very core of the young nation's democratic values, public identity and national cohesion.
For 300 years, America has relied on its decentralized, privately organized network of nonprofit organizations, staffed by motivated volunteers and funded by individual donations and private foundations. Often in collaboration with federal, state and local government-sponsored agencies, civic groups, community organizations and charitable institutions have played vital roles in delivering needed services.
America's corporate sector has embraced service. For example, many companies, like Comcast, Aramark and Lincoln Financial in my hometown of Philadelphia, have “service days” where employees, their families and community partners volunteer their time to support civic projects and charitable programs. Service days often include participating in environmental cleanups, beautifying parks or helping in shelters and food banks. These activities are usually part of the company's broader social responsibility initiatives, which aim to build stronger connections with its local communities, enhance its public image and instill a culture of service throughout the organization.
Service is a unifying force that bridges social, racial and economic divides by bringing together individuals to work toward shared goals, such as caring for the most vulnerable, improving neighborhoods, building communities and advancing the greater good. Service strengthens our democratic foundation and reinforces our inclusive society by fostering understanding, promoting cooperation and boosting civic engagement. Service is the beating heart of our communities, infusing empathy, compassion and harmony. We must continually nurture America's legacy of service.
In his first Directors & Boards Letter from the Chairman, my father wrote that board work is one of the highest forms of service. Directors give their talent, skill and wisdom to improve corporate performance through the assurance of good corporate governance. By taking on this important work, directors have helped to build dynamic, innovative, ethical companies that have enriched the shareholders, benefited the stakeholders and contributed to the nation's prosperity.
In my last Directors & Boards Letter from the Chairman, I encouraged directors to consider government service, whether it be on commissions, boards and agencies or in official roles. Now, perhaps more than ever, our nation needs the best and the brightest to take on these duties and responsibilities. Directors, particularly retired executives, have the experience, skills and time to provide wise counsel and competent oversight, which can help our nation remain strong politically, militarily and economically.
In addition to government service, I have four recommendations for directors. First, I encourage directors to serve on boards of civic institutions and charitable organizations where they can provide their experience and expertise from the perspectives of both board governance and management prerogative. Importantly, they understand the boundary separating the former from the latter. In some nonprofit organizations, the board oversteps this boundary, encroaching into management's domain and taking on managerial roles. Failing to recognize the boundary between board oversight and managerial leadership inevitably leads to dysfunction in both.
Second, on their nonprofit boards, directors should take an active role by getting deeply engaged in corporate governance, including chairing key committees such as finance, HR and audit. They bring to these boards valuable insights and special talents in governance matters, such as risk assessment. They should not take a board position thinking they are there only to lend their name or write a check.
Third, directors should encourage CEOs to get their direct reports, and perhaps other high-potential executives, on boards of service organizations. These top executives can contribute their talents and experiences to helping advance these organizations, as well as learn about the role of a director, the responsibilities of board oversight, the nature of collective decision-making and the importance of good corporate governance. Board engagement is much the same regardless of the organization, and serving as a director of a civic institution or charitable entity is a valuable learning experience for an up-and-coming executive.
Fourth, directors should support programs like organized service days and, importantly, should personally participate in some of these endeavors. They ought to understand that community service helps to convey the company's core values and that corporate-sponsored service programs can boost employee morale, job satisfaction and loyalty, which in turn can lead to better retention and higher productivity. In addition, a reputation for providing community service can help attract prospective employees and customers who place a high value on corporate social responsibility.
On the boards of both corporations and nonprofits, directors bring special knowledge, skill sets and perspectives to the formulation, execution and assessment of service policies, programs and initiatives. They can contribute to, but also can benefit from, community service in terms of broadening their horizons, experiencing new challenges and gaining personal fulfillment. I know many of you do a great deal for your community and for our nation. Thank you for choosing to serve.