Korean Philanthropy: Hyundai’s Corporate Social Responsibility in North America

with

Zafar Brooks, Director of Corporate Social Responsibility and Diversity Inclusion,

Hyundai Motor America

Moderated by Nikita Desai, Director of Policy and Corporate Programs, The Korea Society

NIKITA DESAI:

Welcome to The Korea Society, and welcome to Studio Korea. My name is Nikita Desai, director of policy and corporate programs here at The Korea Society.

Today's program, Korean Philanthropy: Hyundai's Corporate Social Responsibility is part of The Korea Society's effort to highlight Korea's growing profile internationally. As part of our national outreach program, The Korea Society's leadership visited the Hyundai America Technical Center and had the opportunity to meet with the senior technical team led by Dr. Won Suk Cho.

Today we are very pleased to welcome director of corporate social responsibility and diversity inclusion of Hyundai Motor America, Mr. Zafar J. Brooks. Mr. Brooks has had a distinguished career in the automotive industry and has received a number of professional awards. Most recently, this year he was given the 2013 Global Community Award by the Ajamu Group, and in 2012 was named CSR Professional of the Year by PR News. Please join me in welcoming Mr. Zafar Brooks. [Applause]

ZAFAR BROOKS:

Thank you very much.

NIKITA DESAI:

Zafar, please tell us about your background and how you became involved with Hyundai, and what has been your experience to date.

ZAFAR BROOKS:

Thank you so much, Nikita, for that very kind introduction. Good evening, everyone. I am honored to be here tonight to talk with you at The Korea Society about our CSR activities at Hyundai Motor America. On behalf of Hyundai Motor Group, I would like to congratulate The Korea Society for all of the amazing work you do. We have been a proud partner of yours for many years, now.

With respect to my own background, I joined the auto industry in 1986 right out of undergraduate school. I was born and raised in Memphis, Tennessee and currently live in Southern California with my wife of twenty-seven years. We have two adult children who live out of the state.

I joined the auto-industry with Ford Motor Company in 1986 and had an opportunity to get into their management training program, and to enjoy a range of career opportunities throughout the course of my sixteen years with the company. I left Ford in 2006 as the head of the U.S. franchising activity based in Irvine, California for the Lincoln and Mercury Division. I then went to work for Volkswagen of America, where I ran their West Coast Regional Office and later became the national head of marketing for their U.S. and Canadian operation.

In 2005, I had the great fortune to come back to Southern California. I took a position with Hyundai running their West Coast Regional Sales and Marketing office. In 2007, as a result of our company's continued growth, I was offered a position in a newly created role: that of director of general affairs. We brought together, under one discipline, activities we had previously been doing in the areas of government relations, diversity outreach and corporate giving, and I'm very proud that I continue to serve in that role today.

NIKITA DESAI:

Let's talk about corporate social responsibility or CSR. Why are corporations engaging in CSR versus solely focusing on the bottom line? Why is CSR so important?

ZAFAR BROOKS:

That's a great question, Niki, and as a CSR practitioner, I love to talk about the benefits of corporate social responsibility. CSR is not an either/or proposition, it is not the bottom line or not. I would argue that CSR is consistent with overall business philosophy and should be part every company's business mix.

Corporate social responsibility is not really a new discipline. It's something that companies have always done. Today's notion of CSR is just a progression, but in the old days you used to think about community relations, where organizations understood the intrinsic relationship between companies and their communities by giving back to local organizations as a way to make a contribution. It was a great way to build employee morale by partnerering with communities and by sharing with the community what their organizations stood for.

If you look at CSR today as a discipline, it really has moved forward and connected to the overall business mix. CSR is an understanding that there is a healthy relationship between a company's reputation and its business philosophy—that the association with philanthropic activities enables an organization to increase its owner potential, its owner loyalty and improve sales as it gives the company an opportunity to demonstrate its social values to the public.

Again, I would argue that corporate social responsibility is not an either/or alternative of corporate best practices. CSR supports the bottom line. Data indicates that between 80-90 percent of the public would rather do business with a company engaged in socially or environmentally responsible goodwill, as well as do business with a company that is making a difference.

NIKITA DESAI:

I reviewed some data about philanthropy in Korea. Approximately 80 percent of philanthropy is driven by corporate giving versus individual donations. Korea's global profile in philanthropy is really on the rise. Do you believe that philanthropy and corporate social responsibility is growing because of companies like Hyundai?

ZAFAR BROOKS:

Indeed. As you may know, our parent company is based in Seoul, South Korea and we are a leader in the international automobile space. We're one of the largest car companies in the world. And an important part of our business strategy has always included responsible corporate citizenship in the markets we wo serve all over the world. The global slogan of our parent company's CSR is "Moving the World Together." We help to improve societal issues within the communities in which we work and do business.

What I love about the global philanthropic strategy and sophisticated programs that have been created by Hyundai is the focus on the needs of the individual markets in which we work. I brought along with me our Corporate Social Responsibility Annual Report. It's our global white paper which will be available to everyone at the end of the program. The white paper highlights many of Hyundai's worldwide philanthropic programs: projects ranging from education to water to health issues to sports activities. Hyundai is very committed to corporate social responsibility. It is an important part of our overall business philosophy and is encouraged in local markets to provide whatever services are in the best interest of those markets.

NIKITA DESAI:

Please tell us about the Hyundai Hope On Wheels program—how it began and how it has expanded in recent years.

ZAFAR BROOKS:

The Hyundai Hope On Wheels program is Hyundai's nonprofit organization, an authentic effort, dedicated to eradicating the serious problem of childhood cancer. I'd like to give you a little background on how we got started in this work.

It began in 1998 fifteen years ago. A group of Hyundai dealers, along with Hyundai employees, in Boston and greater New England, began raising money to help a local program called the Jimmy Fund, an initiative of the world-renowned Dana-Farber Cancer Institute. That local initiative was born organically and ultimately became a nationwide initiative. By 2004, the program was carried in markets all across the country, and I had the great fortune in late 2006 to be invited to lead this program. We incorporated in 2007. It is now a 501(c)(3) nonprofit organization. That gives us some flexibility and allows the public to engage with us and participate in our campaigns.

During this fifteen-year period, Hope On Wheels has provided $72.6 million for pediatric cancer research here in the United States. We believe, based on data we've seen, this ranks us as the second or third largest nonprofit organization in the United States focused specifically on childhood cancer research that does not receive any government funding assistance. Our program is straightforward. It's quite simple. We help kids fight cancer, and we do so by funding research and creating public awareness about the significant threat of this disease.

Today childhood cancer is the leading cause of death in American children. Every half hour or so another child is diagnosed with cancer. While there has been an amazing amount of progress made through research (nearly 80 percent of childhood cancers can be cured) we do not feel we have come far enough. We look for the day when no child has to go through the experience of having cancer.

During the last fifteen years, we've done a range of things we're proud of, and I'd like to share with you just a handful of some of the more current projects Hyundai Motor America is doing. First of all, we have two different grant categories.

The Hyundai Scholar Award funds a one-year research grant to a member institution that is engaged in research programs that serve children with cancer and their families. This is specifically designed for research projects that help advance the understanding of the disease and treatments within the field. The Hyundai Scholar Award is a one-year award of $75,000. Local dealers and employees around the country nominate local children's hospitals. Once a hospital has been nominated, they are invited to apply. They provide an outcomes-based proposal that has as its goal the advancement of scientific knowledge about the disease.

The second category of grant funding is known as the Hyundai September Hope Grant. Now, many people in your audience may be aware that September is National Childhood Cancer Awareness Month. It's a time where we, as a community, reflect on the significance of this issue and support the children and their families. Hyundai funds this grant, which is a two-year, $250,000 research award. Every COG-member children's hospital in the country is invited to apply.

I am the executive director of this program. That board is a partnership with our Hyundai dealers. They serve on four seats on the board and we, at Hyundai, also have two seats on the board along with the medical advisory committee. We have a panel of eight leading medical professionals who serve on that committee. They help design the grant's guidelines and make sure they are appropriate for the field, and then they review and score the applications which are ultimately funded. In December of 2012 we opened up the process and invited applicants. In early March of 2013 we selected the winners. The grants will be presented in the month of September. I'm proud to tell you that we are funding forty-one different research projects and will award, in that month alone, a total of $10.25 million to benefit child cancer research.

Our mission at Hope On Wheels is to grow public awareness of the prevalence of pediatric cancer, and we have engaged in a wide array of programs on behalf of these children. We are their voice. In addition to all of our special programs, we have developed a community through the use of social media, an important part of that strategy. We have a Facebook page, a Twitter page. We use Pinterest and Instagram. We also have a website: HyundaiHopeOnWheels.org. We invite people to go there, to meet the families, to meet the children and to meet the doctors who are doing the research. It will give you a better idea of why Hyundai, a car company, is involved in this particular issue.

We have created a 5K series which gives people a chance to help the cause with their friends and families - to walk and run - in the communities where we participate. We have pledged that one hundred percent of the money we raise through the 5Ks is donated to a local children’s hospital in that community. We are very much committed to giving back.

Last but not least we have our Youth Ambassador program. A childhood cancer survivor is selected for a two-year assignment. They go around the country with us to meet families and children in different hospitals telling their stories of hope and of their victories. It enables those who have been through the experience to give hope and encouragement to the families who are going on the same journey.

Our current Youth Ambassador is a fourteen-year-old young man out of Miami, Florida. His name is C.J. George. He is an absolutely amazing kid who has such a powerful story. One of the things C.J. often says is, "I didn't have a choice. I had to fight pediatric cancer." We have joined him in his fight to let him know that we at Hyundai, along with our U.S. dealer body, are committed to finding a cure for this dreaded disease.

NIKITA DESAI:

I'm sure you get this question a lot. Why is a car company involved in philanthropic activities around pediatric cancer research?

ZAFAR BROOKS:

We do get that question a lot. I will tell you that I'm not a doctor and I don't play one on TV. As I mentioned before, Hyundai Motor America is committed to corporate social responsibility and philanthropy. Our global brand slogan is "New Thinking, New Possibilities." We take on difficult problems to find innovative solutions to society's problems, and pediatric cancer is an important societal issue that affects more kids and more families in this country than anything else.

As I mentioned earlier, pediatric cancer is the leading cause of childhood death by disease in the United States today. About every thirty minutes or so, another child is diagnosed with pediatric cancer. As I mentioned, while cure rates are upwards of 80 percent for the most common forms of cancer, there's the other side of this story. We've been stuck at this plateau for the last two decades. Making the quantum leap to the next major step, we believe, will come through research funding.

My friends in the medical field will tell you that once these kids go through treatment, there are usually very harsh and long-term side effects. These aren't just young adults. These are young physiologies that are continuing to grow, and sometimes the side effects of the treatments are not known for many years. Problems most of us would never think about in terms of a six or seven-year-old child often show up much later in their lives.

Part of the reason we are so committed to this is because it is such a difficult problem to solve. As our CEO, John Krafcik often says, "We love to take on the hard problems and find innovative solutions." Another reason is it gives our dealer bodies an opportunity to give back to their local communities, and through them we support about 218 children's hospitals all over the country. We are actively involved. We've funded over 600 research projects to date and about 100 research projects every year for the last four years. Over 250 of those projects are in some active form of study at the present time.

We are committed to this. We are a company that is committed to giving back to our community, and we feel this is a problem we simply must overcome. It's about our kids, it's about our future, and this is the fight we are pledged to win.

NIKITA DESAI:

Of course, there are a range of social problems in the United States. How do you decide which programs to support?

ZAFAR BROOKS:    

I have a wonderful job, but that is the hardest part of the job. It is a very difficult task, because there are so many outstanding organizations that are doing good works all around the country. It makes me feel good to go home at night having worked with so many fantastic organizations. But resources being what they are, we cannot do everything we'd like and we can't fund every project that is presented to us.

So, we have a few criteria we look at. The basic criteria we're interested in have to do with the areas of children's health and safety, environmental responsibility, education, arts and cultural appreciation, and community volunteerism. These are the five core areas we look at and the projects we fund need to be aligned with one of these areas. These five core areas give us enough latitude to work on a range of issues, but they also allow us to maintain our focus.

Once we determine that a project falls into one of those specific categories, we then ask questions about the potential outcomes of the proposed research, as our grants are outcome-based. For instance, what is the specific outcome-based component for the program? Our goal is to match the potential outcomes of the research to the social issues we are trying to address. Within our pediatric cancer effort, for example, we require an annual progress report. That is one of the baselines we use to determine the success and viability of moving forward with future grant funding by Hyundai.

Then we look at whether the program is scalable and something we can continue to grow with. Again, we look to make sure the program is aligned with our values. Will our employees, our dealer partners and our vendor partners be able to participate in the program?

I can give you a couple of examples of Hyundai's involvement in philanthropy for context. Most recently, as many of you know, there were some really bad storms in the Midwest and Northeast. We were very proud to help support disaster relief in Oklahoma City and hurricane relief for Hurricane Sandy in the Northeast by making a significant contribution to the American Red Cross.

About a year and a half ago, the Martin Luther King Memorial project on the Mall in Washington, D.C. was created, and we were one of the leadership-level partners that helped in funding the creation of that project. We were proud to contribute to such an important part of America's cultural experience.

Other projects include youth scholarship programs and internship programs. Within our local communities, we've done a range of things such as blood drives and food drives. We support a project called the International Day of Poverty Eradication. That allows our employees to give back with donations of food and clothing.

There is a project that I’m very excited about that I’m first sharing with you. Next week we're going to be in Austin, Texas to announce a new project. We have partnered with an organization called the MIND Research Institute, a nonprofit organization that specifically works with math education at the elementary school level. For the last three years, we have funded a series of Hyundai Math Labs. These labs are an opportunity to help young kids in grades K-6 learn math skills and improve their STEM skills. It uses video-based technology and gives children a chance to learn at their own pace.

Research has demonstrated an association between long-term education and early success in mathematics. We will be announcing next Tuesday a national rollout of this program. It will be our third year funding twelve Hyundai Math Computer Labs across the country in six different states. We believe it will assist 20,000 students who will use these math computer labs to help them build stronger math skills. We're focusing on underprivileged and underperforming school districts in the United States. Hyundai is very proud of all of the programs we've done.

In addition, the Math Labs are outcome-based, so we will be able to review the results by measuring them against other axes. What we've seen so far for the six schools we've already funded is that those students who have gone through the program have appreciably improved their math skills. Stay tuned and you'll hear more about where we're going and what schools we'll be going to.

NIKITA DESAI:       

Well, you should talk to David Joo who took part in our Korean Entrepreneurship Program. He's a young Korean-American who started an online tech education company called KnowRe. It is an adaptive online learning experience that helps students improve their skills.

Let me ask you a follow-up question. You said that Hope On Wheels is not-for-profit. What was the logic behind creating your own nonprofit corporation versus supporting other existing programs? That was really interesting to me.

ZAFAR BROOKS:

That's actually a very good question. By creating its own not-for-profit 501(c)(3), Hyundai has been able to include the public as part of the story. I would often get emails from people telling us they loved what we were doing and offering support. We had no way to accept public donations. This, in part, allows us to do that. It also allows us to work with other nonprofits collaboratively. In addition, it brings transparency and public accountability to the program, because we are obligated to complete a public financial statement for example.

I'm very proud to tell you that close to ninety-three cents out of every dollar we take in goes directly to childhood cancer research. We don't have any employees in the foundation we need to pay. We don't pay rent. We’re in a wonderful position to get that money directly to the scientists and doctors who are doing the research, and we're very proud of that, as well.

[Hope On Wheels Video]

I'd like to make a quick comment about that video which I hope you enjoyed. That was a recap of our results for 2012. That information is also available on our website along with our 2013 kick-off video.

I'm sure you noticed on the video the kids putting their hands into cans of paints and then putting their handprints on a car. That is the iconic part of our program. We collect the children's handprints as a symbol of the commitment we have to this cause. This lapel pin I'm wearing has our logo which was designed to display three hands. These hands represent those kids who have won their battles with cancer, those kids who are in active treatment, and the memories of those who, sadly, were not able to win their battles.

Whenever we present a check to an organization, we don’t just mail them a check. We invite the children to the presentation, as well. We have the kids dip their hands in paint and then leave their handprints on a brand new Hyundai vehicle. We then ultimately scan those hands and we make a decal print. We then drive those cars all around the country. Those handprints are meant to represent all children with cancer, along with their dreams, their memories and, indeed, their value to us all. Thank you for allowing us to share that video.

NIKITA DESAI:

Thank you for sharing. Please join me, once again, in thanking Zafar Brooks from Hyundai Motors. [Applause]

[End]