09/08/2011 01:14 pm ET Updated Nov 08, 2011

American Express Foundation President on Service, Local Communities and Leadership

Tim McClimon is the President of the American Express Foundation, one of the most innovative leaders in philanthropy today. He has a rare ability to see opportunities to make an exceptional impact for both the community and the company's bottom line. We talked this week about how he has translated his vision and insights about the community into powerful programs at American Express.

9/11 is a very personal day for American Express employees given that your HQ is across the street from Ground Zero and you lost 11 employees that day. How did you decide to honor that day by becoming the lead sponsor for the September 11th National Day of Service and Remembrance?
We had to look at our strengths as a company. Our real strength is in service; we depend on having high quality customer service to attract and keep our customers. It's ingrained in our culture here. We felt that the way we could participate in remembering that day would be to engage in something we know very well.

How do you keep it authentic and not make it feel commercial or opportunistic?
We're providing the funding and we're trying to use our own networks and strengths to help engage people. We developed a Facebook app that's an easy way for people to connect with volunteer opportunities. We're just trying to be a good citizen and do something that builds on a strength that we have and that our employees have.

How will you personally be commemorating 9/11?
I'm going to be volunteering with my 13 year old daughter. We'll be part of the New York piece of the National Day of Service. There are three different places; a school, a park clean-up and a project packing care packages. I'm not sure which one of the three we'll be assigned to, but we'll be out volunteering Sunday afternoon as part of the program.

Your Partners in Preservation provides a $1 million historic preservation grant to one organization each year. They are selected by the community from 25 finalists in their city. This was one of the first crowdsourcing philanthropic efforts. How is it going?
People know their communities. They like their neighborhoods. They're proud of the historic sites there. They really get behind the program. Quite honestly supplying a million dollars in historic preservation grants in one community is a big deal for these communities.

We've done San Francisco, Chicago, New Orleans, Boston, Seattle and now Minneapolis/St. Paul and when we go into those cities and announce the 25 finalists it generates a huge amount of locally focused media attention and interest from community leaders and local businesses.

You were a pioneer again with the first external blog about corporate philanthropy - what was the impetus for that?
There are a lot of CSR sites and blogs out there but almost all of them are done by activists. They have a particular point of view about what corporations should or shouldn't be doing. We felt that having a CSR blog that was written by a practitioner rather than an activist might help fill a void out there.

American Express works with thousands of small businesses across the country - helping them realize their potential and create jobs. What are some lessons small businesses could share with nonprofits?
Nonprofits are mission driven organizations and they're really focused on that cause, but sometimes it gets confusing about who their customer is. Is their customer the one to whom they're providing a service or is the customer the one who's paying to ensure those services exist, or is their customer someone else? Successful small businesses are those that can really attend to serving their customers. I think that's a lesson that a lot of successful nonprofits could learn: who is their customer and how do they service that customer.

It often comes down to leadership, I find. This is yet another area where you have been a real innovator.
Leadership is part of our corporate culture here. Our program really married the interest that Ken [Chenault, CEO] & our senior leaders had in leadership with a need that existed in the field where there really weren't many other funders. There really wasn't a national funder that had identified nonprofit leadership as a priority. It gave us a way of doing something unique, differentiating our funding and doing something our senior leaders could identify with.

What have you found is key to developing nonprofit leaders through your Leadership Academy?
We built the Academy around three different tent poles. One of them is the need for 360 degree assessments in organizations. We wanted leaders to come to us having assessed where they stood within their organizations; how they were viewed by their subordinates, peers and superiors. The second tent pole is executive coaching. We discovered through our support of leadership programs that the ones we thought were really successful had some sort of coaching component. The third pole is to use our senior leaders as teachers and facilitators along with the staff of the Center for Creative Leadership. It really provides an opportunity for our Chairman and our senior people to use their business knowledge and skills and impart them in a way that is relevant to nonprofits.

And we never have a lack of people who want to participate because they get the connection, they know they have skills that may be relevant to nonprofits and they don't have to go anywhere to use them. It's that three pronged approach that seems to really work. And the feedback we get from participants and from our team is really positive.

We've seen firsthand how well that works, it's tremendous. What prevents you from really taking it to scale to serve more nonprofit leaders?
Since we want to keep that as an important part of what we do, we can only do it so many times and in so many locations. We're really focused on deep rather than broad.

The barriers we have are both the money and people, which are the same barriers nonprofits face for the most part. We only have so much money we can devote to this program unless we want to give up grant making - which we don't want to do. We don't want it to overwhelm the grant making we do. That and we only have a certain number of people here.