The retailer will concentrate its 5 percent donation program, directing $500 million over the next five years to helping kids learn to read by third grade.
Target's got a new corporate giving strategy, and Oprah has a hand in pushing it.
The Minneapolis-based retailer said Friday it will refocus the bulk of its 5 percent donation program around a single issue -- education -- and direct $500 million over the next five years primarily to support efforts to get kids reading by the third grade.
It is the single largest charitable contribution in company history, and it doubles the amount Target has put into school programs to date, Target's president of community relations, Laysha Ward, said at a rare media gathering at Target Field.
With one in four U.S. children failing to graduate from high school, and nearly 40 percent of black and Hispanic students dropping out, Ward said Target was "compelled to do more to address the education crisis and ensure our kids are ready for college, a career and the challenges of a global economy."
Childhood education advocates and philanthropy groups said the sizable commitment from a company with such broad consumer appeal could draw more investment into schools from government.
"This is a huge statement from our business community that will have national impact," said Art Rolnick, senior fellow at the Humphrey School of Public Affairs and a leading researcher on the economic effects of early childhood education and nutrition. "Target has done their homework. They're looking to invest their foundation money in the best way possible. They realize there's overwhelming research that shows the earlier you get to our at-risk children, the more impact you can make."
Rolnick said federal programs are looking for matches from private enterprise, and Target could be setting a strong example.
Chuck Slocum, who has spent decades working with businesses on early childhood education issues, concurred.
"Target has incredible reach as far as its influence," said Slocum, founder of the Williston Group, a Minnetonka-based management consulting company. "It will galvanize interest, and it will influence other corporations and foundations. It is very welcome leadership."
Getting Oprah Winfrey on board probably won't hurt either.
On Friday, the talk show host helped launch Target's national campaign to get adults to pledge to read to children. Target will give 1 million books to low-income children to jump-start the effort and will donate up to 1 million more depending on how many people sign the online pledge.
The decision to focus on a single philanthropic issue is a major shift in the company's long history of corporate giving. The Dayton family began a policy of donating 5 percent of the retail chain's annual income to charity in 1946.
Until now, Target has spread those donations -- more than $3 million each week, it says -- across the arts, social services, education and volunteerism.
Jon Pratt, executive director of the Minnesota Council of Nonprofits, said there's a growing trend in corporate and institutional philanthropy to go after specific social issues or specific goals.
The McKnight Foundation also has homed in on getting kids reading by the third grade. Facebook founder Mark Zuckerberg recently announced that he was giving $100 million to a troubled public school system in Newark, N.J.
Pratt said there were pros and cons of this "focus, focus, focus" approach to philanthropy.
"What gets left behind?" Pratt asked, noting that Target has long made direct assistance to organizations that support the basic needs of food, clothing and shelter.
Target's Ward chose her words carefully in a presentation to the media that covered a variety of company issues. Ward said the retailer was "connecting our work in the arts, social services and volunteerism to education for greater impact."
Spokesman Joshua Thomas declined to give more details about what might go unfunded in the future but said the company wants other programs it supports to "align with education." That might include funding for a school food pantry program or school field trips to museums or art institutes.
In 2009, Target gave $187 million in cash and non-cash donations through its 5 percent program.
A promotion that allows Target credit card holders to donate to schools of their choice funneled roughly $27 million, the company said. But that money is directed by shoppers, and doesn't always go to the neediest schools.
The announcement comes at a time when Target has taken a public relations hit for a much smaller donation -- a $150,000 campaign gift to MNForward. The donation to the pro-business group, which backs Republican Tom Emmer for governor, was met with calls for boycotts from supporters of gay rights who said Emmer's stand against gay marriage and other social issues didn't align with Target's policies.
Target said Friday it is still evaluating its policy on political contributions.
The company had a much easier time talking about doing good deeds in schools.
Said Ward: "Our enhanced focus on education isn't a promotion or a one-time campaign."
Jackie Crosby • 612-673-7335