Seventy million readers eagerly awaited last month’s release of Sports Illustrated’s annual swimsuit edition, an issue that attracts more than twice the number of readers of a typical issue.
But for many of the staff members at the Nature Conservancy, the issue’s publication set off rounds of soul searching and criticism after news got out that the charity has embarked on a partnership to promote the swimsuit issue alongside the Gilt Groupe, a Web site that sells luxury goods, travel, and specially arranged events.
With the deal, the charity, America’s wealthiest conservation group, gets all the money from the sales of goods and events Gilt produced to promote the swimsuit issue. One such offer gives members the opportunity to mix and mingle with the swimsuit models at the issue’s launch in a posh New York nightclub. A $1,000 VIP ticket ensured up to 12 drinks, all to benefit “the Nature Conservancy’s beaches and oceans conservation work.”
The partnership set off alarm bells among some people in and out of the Nature Conservancy who feel the swimsuit issue demeans women and that associating with it was unwise for a charitable cause.
After Mark Tercek, chief executive of the Nature Conservancy, learned about the arrangement, he sent a message to staff and board members apologizing for any offense it had caused people who work and volunteer for the organization.
Mr. Tercek said he had not been informed of the deal in the early stages and that by the time he learned about the agreement, it was impossible to pull out without risking an expensive legal challenge and potential financial penalties.
But he did tell the organization’s marketing staff not to proceed with promotions for the arrangement that went above and beyond those that were necessary to fulfill its role in the deal. He has also revamped how the group vets such agreements.
Seeking Young Donors
The controversy the organization faced internally, including from angry board members and female staff members, shows the risks that nonprofits can encounter when they seek catchy ways to reach young people. Most readers of Sports Illustrated’s swimsuit issue are age 30 to 45, a younger set than the typical Nature Conservancy supporter who is, on average, 62.
“The initial reason why it was attractive is that one of our core strategies as an organization right now is to broaden the basis of support for conservation and the environment,” says Jim Petterson, a spokesman for the group.
The Nature Conservancy is not alone in facing controversy over a marketing decision.
Many groups have run into trouble with deals that offended some of their constituents. For example, when Susan G. Komen for the Cure entered a marketing agreement with KFC, supporters balked because of concern that the fried-chicken chain’s meals were not healthy and went against the organization’s mission.
Joe Waters, a cause-marketing expert and nonprofit consultant who blogs at SelfishGiving.com, says it behooves organizations like the Nature Conservancy to vet those arrangements broadly to figure out what’s appropriate and what’s not.
“It really does require that an organization is in tune with what their constituency is interested in and what they’re offended by,” Mr. Waters says.
Staff and Board Response
The Nature Conservancy’s controversial step drew an especially sharp response from staff and board members because they said they felt it had escaped screening tests the organization put in place to guard against attacks to its credibility after a 2003 scandal that caused it to come under an investigation from Sen. Charles Grassley, the Republican from Iowa.
“There were some good intentions, but I don’t think necessarily that good judgment was used,” says Steve Polasky, a board member and a professor of ecological and environmental economics at the University of Minnesota. The swimsuit issue, he notes, “is something viewed as offensive by women or people who don’t like to see scantily clad women parading around.”
He says that at a recent meeting, board members raised questions about the adequacy of the Nature Conservancy’s review and oversight process. He recalls people asking: “How did this come about without upper management knowing about it?” “How do we in the future catch something before it’s set in stone and before we can get out of it?” “Who was signing off on it?”
Not everybody thinks the marketing deal with the swimsuit edition was a reason for concern, however.
“I’ve been a feminist all my life,” says a staff member who spoke on condition of anonymity because she was not authorized to comment publicly on the matter. “This didn’t really offend me. I didn’t have any issue with it. But that’s just me. I can understand why some people do.”
Ten months of marketing work went into the deal after Sports Illustrated approached the Nature Conservancy in May.
The environmental organization promised to post a Web page where people could learn about Sports Illustrated’s work for the organization on oceans and coastal issues. It also added a reference to Gilt to its corporate page, tweeted about the deal, and mentioned the partnership in a newsletter sent to donors.
The Nature Conservancy says it was not guaranteed a specific amount of money from the sales related to the promotion of the issue and probably won’t know until summer how much it will receive from the deal. The magazine didn't guarantee a mention in the swimsuit issue, but the organization's work was cited in an essay by the musician Lenny Kravitz. [Editor's note: The previous paragraph corrects an error about Sports Illustrated that appeared in an earlier version. Neither the charity nor the magazine says the Nature Conservancy was promised its name would appear in the print issue.]
For Sports Illustrated, the venture was one of the few times the “swimsuit franchise had done anything philanthropic in nature,” says Scott Novak, a spokesman for the magazine. “We felt like they have a world-class and world-renowned organization and are widely respected for their work.”
Mr. Novak said he wasn’t aware of the internal struggle at the organization after the partnership was announced. “This is the first time I’m hearing of this,” he said after getting a call from The Chronicle. “At every turn, they’ve been nothing but supportive partners.”
While the Nature Conservancy may have appeared to be supportive, it was spending a lot of time doing damage control once concerns about the deal surfaced.
“There was indeed a communications gap here,” says Mr. Petterson, the charity spokesman. “The CEO has made it clear that he wants to be informed about cause-related marketing projects. He has also been clear that our marketing staff went into this with absolutely the right intention. We have now put in place protocols to ensure that we don’t have similar communication gaps in the future.”
He added that in the past Mr. Tercek reviewed many marketing deals with companies, “but not all.”
The project also escaped the scrutiny of an internal committee that looks at “new, novel projects” to determine whether they pose any potential risks, such as to the organization’s reputation, finances, or legal standing, Mr. Petterson says. “This project didn’t come to that group.”
Mr. Petterson declined to name the staff members responsible for the deal. Asked if Geof Rochester, the Nature Conservancy’s chief marketing officer, had faced any discipline, Mr. Petterson says the organization is not “applying any blame” and is taking “ownership” of what happened.
In a subsequent e-mail, Mr. Petterson wrote: “I want to make sure I was clear. ... Geof has the full support of the Conservancy’s CEO, Mark Tercek.”
Mr. Rochester joined the organization in July 2010. Before that, he was executive vice president for marketing at World Wrestling Entertainment and a marketing executive at Showtime Networks.
Credibility Still a Concern
To reassure staff members, especially the group’s female employees, which account for 55 percent of its 4,000 workers, Mr. Tercek and his colleagues are trying to make amends.
Still, Nature Conservancy veterans are especially worried about threats to the organization’s credibility.
So is Mr. Tercek, a former managing director at Goldman Sachs who took over the organization in 2008 after the charity faced a Senate investigation and other criticism of its management.
In the years before he was appointed, the Nature Conservancy had come under fire over questionable deals with for-profit companies and trustees and was forced to restructure its board.
Even with such changes, Mr. Tercek’s leadership has hit some rough spots. In 2010, the environmental organization faced criticism after the Gulf oil spill when a Washington Post article reported on the Nature Conservancy’s financial ties with the oil giant BP.
Still, the group has a sterling reputation as a fundraising powerhouse. It brought in $527-million, more than any other conservation group on The Chronicle’s Philanthropy 400, the list of the charities that raise the most from private sources.
Mr. Petterson says he doesn’t think the deal with Sports Illustrated will cause that to change. As a matter of a fact, he says, since the issue came out, “we haven’t heard much from our donors.”