The charitable thing to do: corporate giving benefits not only the community but also the bank's reputation and employee morale. But deciding who deserves the money can be a daunting challenge.

• Author: Bernstel, Janet Bigham
• Position: Cover Story

When Randy Ezell interviewed for the job of bank president four years ago, he remembers the first thing out of bank director Warren B. Mosler's mouth. "I want you to make a whole lot of money . . ." Mosler said, "for medical research through the American Cancer Society."

Ezell, who is the president and CEO of Enterprise National Bank of Palm Beach County, North Palm Beach, Fla, says he was used to the "I want you to make a whole lot of money" part. 'But my old banker instincts told me to step back and think about this (new) arrangement."

According to Ezell, Mosler firmly believed that philanthropic activities were not only good for the community, but also for business. A major commitment made to a worthy cause would benefit everyone. So when Mosler led a group of minority shareholders to take control of the bank in 1996, the new business plan included a provision to donate 25 percent of the bank's pretax income to the American Cancer Society.

"It soon became obvious to me that it was heartfelt, and the ownership of the bank wanted to make a significant difference," comments Ezell.

For a community bank looking to create name recognition and differentiate itself, programs like Enterprise National Bank's Bank for the Cure should be what Ezell calls the "tiebreaker."

"If you know about our good deeds and my CD rates are the same as the guy down the street, why wouldn't you give us a shot?' he asks.

Although he cautions that "the jury on the ultimate success of this program is still out," he has noticed an upward development in employee esprit de corps once staff became involved in the charity's events. Employee morale is turning out to be one of the great payoffs in their campaign. (See sidebar.)

"When your staff has some passion about their volunteer work and the service level they provide, it's contagious," explains Ezeli. "When you're volunteering you get noticed, and that one-on-one marketing is sometimes the very best you can have."

Like many corporations, Enterprise National Bank is finding out that a corporate giving plan is an effective tool for achieving both employee and community relationship objectives. What's not always as clear is the best way to administer the funds or time allocated to charity.

The hot potato

Most financial institutions receive their share of requests for donations, from school sports sponsorships to fundraisers for local chapters of national charities. So how does a financial institution decide whom to give to and whom to turn away?

Larger banks often delegate the giving decisions to their company foundations, kicking it up one step from the bank's daily operations. Some community banks leave the decisions in the hands of the president. At Pueblo Bank & Trust, Pueblo, Cob., for example, there is no formal giving policy. President and CEO Mike Cafasso reviews each request individually. If the request is big enough, say in the $10,000 to $30,000 range, he'll bring it before the board.

"I'll often get input from them even on a request over $5,000, simply because they might have other ideas to enhance the project even further," he explains.

Cafasso taps his marketing background for ideas on contributing in other, cashless, ways too. For example, he has used his media contacts to drum up donated production facilities and airtime for suicide prevention public service announcements. And each December, several of the bank's branches host an Art at Christmas day, showcasing the work of local artists. Sale proceeds fund art scholarships at nearby universities.

How you turn someone down is a critical part of the job, though, he says. Personal attention and a candid response makes it easier for him to say no, and most people he's been in contact with tend to be very gracious, pleased that they've even been considered.

Hand off to marketing

Other banks tend to point donation requests straight to the marketing department. Whether it's because they have the most direct access to the...