'Tis Better to Give
One on One with John McCall Macbain
By Peter Mitchell
On October 15th John McCall MacBain was named the Distinguished Leader for 2008 by the Brock University Faculty of Business. The Niagara born native attended A. N. Myer Secondary School in Niagara Falls before graduating in economics from McGill University, attending Oxford University as a Rhodes Scholar, and receiving an MBA from the Harvard School of Business.
His impressive academic record was quickly surpassed by his business accomplishments. After working for three years as the director of marketing for Power Financial Corp. he struck out on his own in 1987 and bought Auto Hebdo, a Quebec based classified magazine for people buying and selling automobiles. Over the next two decades he built one of the largest classified advertising empires in the world, Trader Classified Media, extending throughout Canada before providing similar publications in Europe, China and Russia. Under MacBain`s entrepreneurial guidance, Trader Classified boasted 50 Internet sites and 350 print titles in 25 countries.
When he sold the company in 2006, the North American assets alone were worth a whopping $760 million. He could easily have invested in a yacht and sailed off into the sunset and a more-than-comfortable retirement. Instead he embarked on a new venture; possibly the most satisfying one of an already illustrious life.
He established the McCall MacBain Foundation to invest in climate change and other worldwide concerns. Based in Geneva, where MacBain now resides with his family, the charitable foundation presented its first grant in July 2007 to Liberia. Working in partnership with Conservation International, the goal is to help the African country improve its education, healthcare and environmental practices. While many might consider them lofty, possibly insurmountable aspirations, those naysayers don`t possess the drive and entrepreneurial spirit that has already led this international philanthropist to seemingly insurmountable educational and business success.
Business Niagara was fortunate to obtain an interview with Mr. McCall MacBain to get his thoughts on philanthropy and the responsibility we all share, as businesses and individuals, to put the pursuit of profits aside to help those causes and individuals in need of assistance. As any philanthropist will tell you, it is better to give than to receive.
Why do businesses give?
It’s not the guilt feeling. You want to give back. It seems like the right thing to do. There are great needs in the world. We’re concentrating our efforts on two major areas: health and education in sub-Saharan Africa, starting with Liberia. There are great needs there. People are dying. We’re working on maternal mortalities, stuff like that, with our fund.
Secondly we’re working on climate change because it’s having a terrible impact on our planet, on our children and our children’s children. We have great needs and philanthropists are needed to make changes that the government isn’t handling. Philanthropists play a big role and we’re willing to take it on. We have been fortunate through our system to be able to amass enough wealth, much more than we need to live on. So let’s try to give it away intelligently to try to make some good changes in the world.
Secondly we’re working on climate change because it’s having a terrible impact on our planet, on our children and our children’s children. We have great needs and philanthropists are needed to make changes that the government isn’t handling. Philanthropists play a big role and we’re willing to take it on. We have been fortunate through our system to be able to amass enough wealth, much more than we need to live on. So let’s try to give it away intelligently to try to make some good changes in the world.
Do you believe in philanthrocapitalism: the belief that businesses can help the world’s needs better than governments and individuals?
There are roles for everyone. One of the things we’re doing is investing in sustainable and social business. We have a big project to make a 35 megawatt wood chip renewable plantation in Liberia. That’s a big project that will change the lives of many people. They’ll get more power, they’ll get reliable power, and they’ll get power at half the price –with a zero carbon footprint.
If we make money, which will of course go back to our foundation, that’s great. So we can create a business which makes money, allows us to give away more money and at the same time creates a lot of jobs. We think this particular project has enormous potential; potentially more than governments and pure charities can provide by developing business in those areas.
Can you expand on Corporate Social Responsibility?
I do think that we forget how lucky we are. Corporate Social Responsibility makes sure that you’re doing things that aren’t harming the environment, because you’re going to have to be living in this environment in the future, both in your personal life but also your business life.
I don’t know how, for example, Philip Morris can hire any employees. I don’t understand that. People are mixing their personal life and their business life too much. I think that businesses have a role and businesses will maximize profit, but there’s a role for financial philanthropy. And individuals have a lot of money when they sell their businesses. They just don’t need to do stupid things and buy a big boat. They can do good things with their money and that’s what we want to do. That’s where our social responsibility is.
From a business owner’s standpoint, are there any other benefits beyond the “feel good” PR factor? Are there tax benefits?
The big benefit is that you’re doing the right thing. You’re helping to save lives. You’re helping make advances in a population that’s in dire need of particular luxuries that we had to give us a good start - education and healthcare – to get to where we are.
Has business philanthropy evolved in the past 10/20 years with the rise of the internet?
I think philanthropy has evolved in two ways. One is the political side. If you see Barack Obama’s campaign, he’s been able to raise a lot of money. There are also philanthropists that are raising money through the internet.
Also, Bill Gates has done a great thing by giving away the majority of his money to the Gates Foundation and getting Warren Buffet to put money there. That makes it a beacon of light for other business people by saying: “When you sell your business you don’t need all that money”. Try to invest it in smart philanthropy. Divide that between a big foundation like ourselves or a bank that gives away a little money here and there. That’s not as focussed as a smaller program like we’re talking about. They do it for community reasons etc. We’re doing it for the best health outcomes, the best educational outcomes.
Is there a downside for either the business or non-profit organizations?
Oh yeah, there’s that example of a city in Holland that decided they were going to do these great things by running some of their utilities with palm oil. What was happening was people in Indonesia were burning down their native forests to plant this palm oil, and they were creating more carbon in the atmosphere than if they were using gasoline.
Bad philanthropy can actually cause negative outcomes more than if they hadn’t done anything. There are lots of examples of that. You have to be careful when you’re giving and think of the ultimate goal. Will it be achieved properly? Some people don’t look at that; they don’t look at the unintended consequences of their giving. The other big one is bio-ethanol: using food as a fuel has basically raised fuel prices for the poor people in the world. That’s not a good thing.
What advice would you give to avoid that kind of scenario?
You should seek expert advice. You should evaluate your goals, set the goals for your programs, evaluate the programs in their execution to see if they are achieving those goals, and beware of unintended consequences. I guess the big thing philanthropies should do is make sure that what they do is sustainable. Not just give money away and the second it stops everything dies. Or buy a big building that nobody uses.
You have to be very careful that you have an entry and an exit point in your strategy. You want it to be sustainable. Some day the Ministry of Health in Liberia can take over this midlife college we’re setting up. We’re paying for a few years but eventually the Ministry will have to take over the cost and train local people to run it at a rate they can afford over the long term. Our philanthropy can’t continue to fund things indefinitely so they have to be sustainable over time. You want to be a change agent.
What can people or businesses do to protect themselves from frauds?
You want to get to know your grantees ‑ who you’re giving your money to and what you’re giving it for. Number two is to make sure you check it out. Don’t just give away your money and say “Good luck”. Give money over time, not all at once up front. Check up on it, make sure that your goals are very clear, and the staff is actually hired. Have them do a budget to show where the money is actually going.
What’s next for you personally and for your foundation?
We’re hoping to continue to develop green energy for Liberia on the investment side of the foundation. For the foundation itself, we’re looking at strategic grants around the world for the environment, and also to try to find more educational grants we can give in Liberia.
Any final thoughts?
I think people need to be aware of the responsibility they have to give to others, and try to do it in an intelligent way.
