In the previous article in this series, “Giving Back: Building a Legacy Beyond the Profits”, we featured Watermark, Xylem’s global corporate citizenship program, which sits inside the business rather than beside it, and Xylem invests a portion of company profits into water causes every year. The Hempel Foundation sits at the opposite end of the spectrum. It is neither inside the company nor beside it. It is its majority owner.
A Little History
In 1948, J.C. Hempel made a decision that would shape his company for generations. Thirty-three years after founding a small marine paint business in Copenhagen at age 21, he transferred all his shares to a newly created foundation. His reasoning was simple. He wanted a permanent owner to protect its future and, once the business was secure, to ensure its profits benefited society.
More than 75 years later, the Hempel Foundation remains the majority owner of what has become a global coatings group employing thousands of people in dozens of countries. Its purpose works on two levels. The first is stewardship: supporting the company’s long-term development and competitiveness. The second is giving back: the dividends the Foundation receives help fund education and nature conservation work worldwide. The Foundation has supported programmes reaching 1.6 million children with better learning opportunities and conservation programmes covering five million hectares of tropical forest.
This approach creates an unusual relationship between a business and its people. Hempel’s employees are not asked to volunteer or fundraise. Instead, the message is that their everyday work keeps the company strong and makes the Foundation’s work possible. It is a powerful idea, but not an easy one to bring to life for someone on a factory floor thousands of miles from the projects it supports.
To understand how that works in practice, and how a legacy built on long-term ownership stays meaningful to the people who sustain it, Margaret Jaouadi spoke with Anders Holm, Chief Executive Officer of the Hempel Foundation, who has been with the Foundation for nine years.
J.C. Hempel decided the company’s future should come first, with profits returned to society once the business was secure
Margaret: How does that order of priorities shape the Foundation’s role today, as both owner and philanthropist?
Anders: The Foundation is very aware that our first and foremost purpose is the long-term ownership of Hempel A/S. You can see that in our board, too. Most of our board members come from the business side, reflecting the board’s top priority: long-term ownership of Hempel.
Maintaining a strong financial reserve is essential to fulfilling that ownership role. It also gives us a sound basis for long-term philanthropy. A strong Hempel creates the Foundation for us to make a difference in society for generations to come.
Margaret: Foundation ownership often signals stability and long-term thinking. In what ways does it make Hempel a more attractive place to work?
Anders: In Denmark, foundation ownership is actually very common. Many of our biggest companies are foundation-owned, including Novo Nordisk, Carlsberg, Maersk, and Hempel.
Foundation-owned companies invest significantly more per employee and are more capital-intensive. They are also more likely to survive over the long term. They also play a major role in research and development, accounting for 34% of private-sector R&D employees in Denmark.
For employees, that combination of a long-term perspective and investment in the business can be very attractive. Foundation ownership adds another dimension: their everyday work also helps make a wider contribution to society possible through the dividends paid to the Foundation. For those reasons, I think it is very attractive for employees to work for a foundation-owned company.
The people at Hempel make our work possible
Margaret: The message to employees is that their daily work funds the Foundation. How do you make that feel real for someone far away from the projects you support?
Anders: It is very important for us. If you asked my colleagues at the Foundation why we are here, they would point to our visionary founder and to the people at Hempel who make our work possible. But it is also because of the strong long-term link between how well the company performs and how much we can do in our philanthropic work. So we make a point of reminding our colleagues at Hempel A/S that their work and our ability to do our work are strongly connected.
The good news is that both leadership and employees are genuinely interested in learning about what we do. We welcome leadership teams to our office to talk about the way we work. We are holding an annual summer party where we invite employees to hear about the impact we are having. In Denmark, we invite colleagues to see our work firsthand, and we take part in company-wide town halls.
Much of our work, though, takes place many kilometres from Denmark, in Indonesia, Madagascar, Brazil and other places. So we arrange eyewitness trips, where 10 colleagues from around the world travel to one of the countries where we support work and see firsthand the changes we are enabling. The trip comes with an obligation. Those 10 people return to their offices around the world, hold their own town hall, and share what it means to them, as employees, to see the difference we are making together. We have also had the company’s leadership team visiting our work.
What really strikes me is that I can meet colleagues five, six, seven, or eight years after a trip, and they still get emotional talking about the children they met, the nature they saw, and the organisations they engaged with, and how hard they worked to make the world a better place. We’re proud to welcome colleagues and leaders to experience firsthand the impact we are making together.
Margaret: How does the Foundation decide which projects and partners to support?
Anders: Our priority is to have as much positive impact as we can. We take a strategic approach to philanthropy, thinking hard about how we can work, who we can support, and what in-house capacities we need to have as much impact as possible. For us, doing good isn’t good enough. We try to work in ways that create the most positive change for children and nature worldwide.
Most of our work takes place in low-income countries, which by default have limited resources and fragile institutions. However, in this context, we try to maximise impact by focusing our funding on countries committed to positive change in the areas we work in. For education, this means working in countries where governments prioritise education and are committed to implementing effective programmes at scale. We fund NGO partners who can help turn that commitment into better learning for children. Our support is quite small compared with a government budget, but it can be very strategic.
We think much like a private investor. A private investor invests where they can get the highest long-term return, and we do the same. We invest where we can get the highest return, not for ourselves, but for the communities and countries where we work.
Maximising the impact
Margaret: How do you ensure your funding creates the greatest impact while also helping partners build stronger organisations?
Anders: In philanthropy, you always need to consider how you can drive the most positive change. That means considering both the needs we want to address and what our partners need to deliver lasting results. We very rarely implement work ourselves, and never abroad, so we depend on organisations that can deliver.
We look carefully at how funding is used, but the share spent directly on activities is not, on its own, a measure of effectiveness. Strong organisations need capable leadership, good systems and the ability to learn and adapt. Just as a private investor invests in building a business’s capacity, we invest in our partners’ ability to deliver lasting impact. Especially with medium-sized organisations, we ask how we, as a funder, can help them grow their impact. Often, that means investing in their capacity to deliver and supporting their communications, impact measurement, and fundraising. Whenever we do, we ask where that investment will take them in three, four, or five years.
We also tend to give grants for three or four years, partly for that reason and partly because, in the areas where we work, creating impact in a single year is very difficult.
Margaret: Do your project locations follow the countries where Hempel operates, or are they decided purely by where the need and impact can be greatest?
Anders: Purely by impact. We do not choose countries based on where Hempel A/S operates. The company has very few activities in Africa, yet the Foundation invests the most there. Our philanthropic priorities are set independently of the company’s commercial footprint. We focus on places and organisations where the need is highest, and where, for one reason or another, we believe we can help support change at a larger scale.
Margaret: With the 2030 targets just around the corner, how do you expect the Foundation’s work to evolve?
Anders: We focus primarily on education and biodiversity, and, honestly, we won’t solve those issues by 2030. So here too we think long term, and they will very likely remain our priorities for many years to come.
We are working hard to measure our impact. Our board challenges us on it and considers it very important, so we now have a person in the organisation dedicated purely to learning and impact measurement. We want to go beyond counting how many children we have reached or how many hectares we work in to understand the changes our support helps achieve. In education, how many children are we actually improving learning outcomes for? In conservation, in how many of the world’s most important biodiversity areas are we seeing reduced deforestation, more sustainable management, and more sustainable funding than before?
In conservation, we are strengthening how we set targets and track forest loss across the landscapes we support, looking at longer-term trends as well as year-to-year changes. Are we moving in the right direction? If not, why not, and how can we reduce deforestation next year?
We have also learned that having resources in-house can be an important way to create impact. In Denmark, we are buying land and transforming it into nature. So in many areas we are taking a more proactive role, and in some we are implementing work ourselves. More broadly, we want to use our knowledge, partnerships and funding to help effective approaches reach a much larger scale. That also means bringing other funders and partners on board. Our own resources are limited, but we can help mobilise far more around approaches that work.
Margaret: Is there a project you are particularly proud of?
Anders: I am really proud of how far we have come as a foundation over the last six or seven years in enabling impact around the world. What always inspires me is visiting the countries and landscapes where we work. Sitting in a classroom in Rwanda or Tanzania, talking to the teachers we support, the children who are now getting a better education and their parents, you begin to understand what the work means beyond the numbers.
Since I started, we have supported 1.6 million children with better learning opportunities. We focus on primary education, typically the first three years of school, where children build foundational learning and basic skills. The difference in a child’s opportunities between being able to read and not being able to is enormous. Meeting some of those children firsthand reminds me it is not just a number. They are real people whose lives are taking a different, more positive direction.
Margaret: What keeps you inspired in leading the Foundation?
Anders: It is a privilege to lead a foundation doing all this work, and seeing the difference we make inspires me every morning. But it also inspires me to talk with colleagues at the company who share that dual purpose: not only working for a great company, but working for a company whose dividends to the Foundation help fund work aimed at making the world a little bit better.
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