The Nature Conservancy History

Company Perspectives:

"Nature's real estate agent." That's The Nature Conservancy. Among environmental organizations, we fill a unique niche: preserving habitats and species by buying the lands and waters they need to survive.

Company History:

The Nature Conservancy (TNC) is the star performer among environmental groups, in size, growth, effectiveness, and stature among government agencies and private donors. On average, 1,000 acres a day are added to its system of nature preserves, the world's largest. When TNC cannot buy desired property, it sometimes attains conservation easements restricting use of the land in return for tax benefits.

TNC traditionally has maintained a low profile, preferring to let its partners reap the media attention. It began pressing, however, for more publicity in this earth-friendly age, garnering numerous product sponsorship deals as its membership approached one million. Author Peter Drucker singled out the management skills of the group, whose MBAs and lawyers injected a powerful dose of high finance into a field better known for grass roots activism.

Origins

The Ecological Society of America, a scientific group, was founded around 1900. In 1917 it formed a study group, the Committee for the Preservation of Natural Conditions, that would split from the Society in 1946 to become The Ecologist's Union.

One of this group's members, engineer Dick Pough, learned of the Nature Conservancy of the British government while traveling to England. In 1951 The Ecologist's Union adopted the name The Nature Conservancy, although Pough envisioned private rather than state support for the group. Donations from Pough's wealthy connections--such as $100,000 from Reader's Digest cofounder Mrs. DeWitt Wallace--put TNC in business.

TNC bought its first 60-acre property, Mianus Gorge, in 1955, sparing it from the development that surely would have spread from nearby New York City. Other small preserves followed, and the group found itself in competition with the venerable Audubon Society, also soliciting property donations.

This year marked the beginning of TNC's Land Preservation Fund, which acted as a rotating credit account. From an initial $7,500 donated by the Old Dominion Foundation the fund blossomed to more than $100 million by 1990. Mining heiress Katharine Ordway donated more than $53 million.

TNC bought the entire island of St. Vincent off of Florida's gulf coast for $1 million in 1969. It became a 13,000-acre national wildlife refuge. The 40,000-acre Virginia Coast Reserve was even more ambitious. The Virginia Coast Reserve was first begun in 1969 to protect nesting shore birds in particular from a developer who wanted to continue the development in overcrowded Virginia Beach to the barrier islands. After TNC began making acquisitions, however, politicians scrapped plans for bridges connecting the islands to the mainland.

The Corporate 1970s

By the 1970s the character of the organization had shifted from that of a scientist's group to something more akin to that of a property management company. TNC had about 50 employees, including Pat Noonan, a determined MBA who served as director of operations.

The group began to court corporations, the scourge of many environmentalists, for land donations. Union Camp Corporation donated 50,000 acres of the Dismal Swamp, a gift worth $12.6 million and believed to be the largest corporate donation at the time.

The Nature Conservancy employed a novel strategy in acquiring 35,000 acres of Mississippi swampland in 1973. When some of the shareholders of the Pascagoula Lumber Company vetoed a purchase offer of $15 million, it bought a controlling interest in the company. In 1976 TNC sold the land to the state of Mississippi for use as a state park. Mississippi, with its sportsmen-oriented approach to conservation, gave TNC a foothold in the Southeast.

In the case of Shelter Island, TNC bought all of a New York realty company's holdings, including property in Manhattan and Miami, to attain some Long Island osprey habitat. After the excess was resold, the land for Mashomack Preserve cost $5 million. Within 20 years, the osprey population had doubled.

Pat Noonan became president of TNC in 1974. At the insistence of its board of directors, TNC had developed a long-range plan. The United States was divided into regions, which would start the next level of organization: self-funding programs in each state.

Dr. Robert Jenkins, TNC's chief scientist, proposed a rescue mission for TNC: "The preservation of biotic diversity." He often alluded to Noah's Ark. TNC attempted to preserve specific species at risk by controlling specific habitats. The first of 50 State Natural Heritage Programs was established in South Carolina in 1974. After receiving initial support from TNC in identifying species at risk, the programs reverted to state funding.

An international program also was started. It eventually grew to include dozens of preserves in Latin America and the Caribbean, as well as projects centered in Canada, Palau, and Indonesia.

In 1978 TNC spent $2.8 million on its largest purchase at the time, buying nine-tenths of Santa Cruz, an isolated island off California whose rare native plant species had been severely threatened by feral pigs and 30,000 sheep, which TNC would have to eradicate. Fortunately, an ecologically savvy New England heiress supplied a quarter of the $4 million required to complete the project.

Thriving Under Reagan in the 1980s

Pat Noonan stepped down as president in 1980 but continued to serve as a consultant, as TNC required all the creativity it could muster. During the Reagan years, money for public programs of all kinds was scarce and Secretary of the Interior James Watt halted federal land acquisition. Nevertheless, TNC was able to persuade the state of Mississippi to support the launch of the Rivers of the Deep South program, which began with a massive $15 million grant from a private foundation.

By 1984 TNC had invested $25 million in the Virginia Coast Reserve, now expanded to include deepwater frontage along the eastern shore of the Virginia mainland. Since TNC could not sell the land to the federal government as a wildlife refuge during the Reagan administration, it was financed by an innovative charitable lead trust, which allowed the tax-free distribution of a foundation's real estate investment.

In 1984 TNC turned over to the federal government the 118,000 acres of North Carolina coastland that would become the Alligator River National Wildlife Refuge. Red wolves would be first reintroduced into the wild here. The same year, the largest privately held preserve, the 67,000-acre Panther Ranch, was given to TNC by the Harte family of Texas. Most of it became part of the Big Bend National Park straddling the Rio Grande. The year 1984 also marked the establishment of Coachella Valley Preserve, which helped keep 13,000 acres of expensive Palm Springs real estate habitable for creatures like the fringe-toed lizard.

While other environmental groups such as Greenpeace (which eschews any corporate support) made headlines by chasing whaling ships and blocking logging roads, TNC's less confrontational approach attracted a broad base of supporters. By 1985 membership stood at 300,000.

TNC began a unique program, surveying 25 million acres of Department of Defense property, in 1988. Another new partner was Ducks Unlimited, which it joined in buying $3.5 million of California farmland to be reverted to waterfowl habitat.

TNC began an extensive survey of 14,000 North American plant species and added an even more impressive purchase than the Santa Cruz property: nearly all of the Animas Mountain range in New Mexico--321,703 acres of diverse wildlife habitat formerly owned by the Gray Land and Cattle Company. Negotiations for the acquisition had begun in 1982. The Big Bend development protected marshland on a similar scale in the eastern United States. Big Bend soon was resold to the state of Florida.

In 1989 The Nature Company, a Berkeley, California catalog merchandiser, entered a partnership with TNC whereby it processed new memberships and donated a portion of its product sales. Income at the time was $168 million and in 1990 membership reached 600,000 as the last of 50 state chapters was added. With assets worth $620 million, TNC managed 1.5 million of the more than 5.5 million acres it had protected.

TNC promoted the concept of "greenways"--linear belts of wilderness connecting wildlife sanctuaries. Its philosophy grew to rely less upon acquisitions, preferring to convince existing owners to take care not to harm wildlife by using pesticides, and so forth.

TNC sometimes appeared the bane of property developers, resentful at being told how to use their land and at the millions spent to preserve unappealing species such as crocodiles and rats. In addition, land acquired by the Conservancy no longer generated property taxes for local communities.

TNC also faced charges of threatening reluctant property owners. Further, an audit questioned prices federal agencies paid for TNC properties from 1986 to 1991. Subsequent reviews factoring in donations and other losses concluded, however, that TNC actually lost money on the deals.

The Green 1990s

Realizing the importance of accounting for people themselves in populated landscapes, TNC began acquiring new properties around its Virginia Coast Reserve to be resold with permanent restrictions to encourage certain uses, specifically, farming rather than coastal property development. TNC created the for-profit Virginia Eastern Shore Sustainable Development Corporation to manage the project, which included job creation among its objectives.

TNC extended its approach of compromise and cooperation to big business. Corporate giving accounted for $2 million, or 16 percent, of TNC income in 1991. By the mid-1990s, 500 companies, such as Miller Brewing Company, Canon USA, Honda of America, Procter & Gamble, and Warner-Lambert, supported TNC with donations, some of them through cause-related marketing. This arrangement allowed the corporate partners to use the TNC name and logo in promotions. TNC also introduced its own credit card.

In 1992 TNC helped broker a compromise between the Walt Disney Company, which wanted to expand its Orlando theme park, and the state of Florida, which wanted to protect adjacent wetlands. Disney agreed to restore 8,500 acres of wilderness in central Florida and was allowed to proceed with its development. TNC also worked out an agreement with Georgia-Pacific concerning timber harvesting on certain property. Each party held one vote to decide whether particular parts of the area should be harvested.

TNC reassessed its performance measures--such as acreage protected--after the bog turtle population in Schenob Brook, a Massachusetts acquisition, continued to decline because of uses of the watershed beyond the site's borders. The organization began seeking out much larger areas to preserve, designated Last Great Places, such as the Fish Creek Project organized to save a population of freshwater mussels. In this case, TNC helped subsidize no-till farming technology to reduce the amount of silt in the water. TNC's vision of preserving entire biological systems actually had been pronounced as far back as 1975.

To restore 36,000 acres of tallgrass prairie in Oklahoma bought in 1989, TNC initiated a series of prescribed burns there in 1993. A small herd of bison then was reintroduced onto the restored landscape. Membership reached 766,000 in 1993, revenues were $280 million, and nearly eight million acres had been protected. Assets approached $1 billion.

The number of species found in tropical rain forests ensured TNC's interest in foreign countries. A dozen Conservation Data Centers cataloged this ecological diversity around the globe, and its "Parks in Peril" program assisted national governments in maintaining existing parks. At the end of the century, TNC had operations in more than 20 countries. TNC helped preserve 57 million acres outside the United States, compared to ten million within. In 1996 TNC counted 900,000 members and 1,850 corporate associates.

Further Reading:

• Blair, William D., Jr., Katharine Ordway: The Lady Who Saved the Prairies, Arlington, Va.: The Nature Conservancy, 1989.
• Fabris, Peter, "Doing Good by Doing Well," CIO, April 1, 1995, pp. 42-50.
• Grove, Noel, The Nature Conservancy, New York: Harry N. Abrams, 1992.
• Howard, Alice, and Joan Magretta, "Surviving Success: An Interview with the Nature Conservancy's John Sawhill," Harvard Business Review, September-October 1994, pp. 108-18.
• Kennett, Jim, "Land Donations: A Booming Business Option," Environment Today, April 1993, pp. 3, 12.
• Morine, David E., Good Dirt: Confessions of a Conservationist, Chester, Conn.: Globe Pequot, 1990.
• Osterland, Andrew W., "War Among the Nonprofits," FW, September 1, 1994, pp. 52-53.
• Regan, May Beth, "No Nukes, No Logging, No Money," Business Week, July 24, 1995, p. 40.
• Zbar, Jeffrey D., "Firms Go Green with Conservancy," Advertising Age, January 11, 1993, p. 16.

Source: International Directory of Company Histories, Vol. 28. St. James Press, 1999.

Directory of Sample Business Plans Directory of Company Histories Contact Us Advertise