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MGM Mirage Changes Charity Policy

LAS VEGAS -- MGM Mirage's charitable efforts will undergo a springtime withdrawal from the oversight of the United Way of Southern Nevada as the organization's largest donor seeks greater control of its employee and corporate giving.

Executives of the Strip giant say the move is a reflection of the company's growing financial power as a member of the Fortune 500 and will clearly demonstrate that it is a player when it comes to charitable work within the state.

One key change: The United Way will simply become one of many charitable options in MGM Mirage's payroll deduction plan.

"We're not withdrawing from giving. The giving continues," said MGM Mirage spokesman Alan Feldman. "We're changing our philanthropic program to go direct to charities rather than the United Way."

Company executives have privately argued that MGM Mirage and its workers do not receive adequate credit for their charitable efforts, which saw them raise $2.4 million, or nearly 20 percent, of the $12.15 million collected by the local United Way chapter for its 2001 charitable campaign.

The company's workers gave $1.9 million while the corporation donated $500,000.

"In part, it's a response to ongoing polling where the public says the casinos aren't doing their fair share," Feldman said of the giving change that could be completed by late next year. "As an industry we're doing more than anyone else in the state."

Top players in the United Way of Southern Nevada downplayed the move's potential impact on the charitable organization, although it could be forced to replace lost revenues, including nearly $370,000 from MGM Mirage's share of giving that has gone toward the organization's $1.8 million annual operating budget.

Mandalay Resort Group was the charity's second largest donor during the 2001 fund-rasing campaign by giving $732,887.50 in corporate and worker donations.

A total of 85,000 individuals and 500 companies donated this year to the local United Way chapter, which is one of 1,400 chapters throughout the country.

"We have many challenges, and this is one of them," said Gail Ousley, the organization's interim executive director. "Since Sept. 11 happened, our whole community at large has been challenged.

"We are working harder. We need to bring in more new accounts and find more dollars."

The move comes three months after the release of a Business Community Investment Council survey found that the casino industry's level of philanthropic giving appeared to be low when compared to other industries.

At the time, MGM Mirage executives rejected that claim, saying the industry is a big donor to the United Way but does not receive credit for donations filtered through that organization.

The change in charitable giving reflects MGM Mirage's addition this year to the Fortune 500 list of the country's largest revenue-generating companies. The casino giant was formed in 2000 after MGM Grand's $6.4 billion purchase of Mirage Resorts.

With the company's elevation to the Fortune magazine list, MGM Mirage President and Chief Financial Officer Jim Murren told his top executives that they should examine all aspects of how they do business to ensure that MGM Mirage operates like a company worthy of the designation.

"There's a sophistication that they bring, a different world view," said Punam Mathur, the company's vice president of Corporate Diversity and Community Affairs.

"This challenges the scrutiny of the way that you do what you do. We asked, 'Is there another model that would be a better fit, especially in community involvement?' "

Mathur and MGM Mirage Executive Vice President of Marketing Bill Hornbuckle serve on the board of the local United Way chapter and co-chaired last year's giving campaign.

As they begin the March changeover in their giving strategy, MGM Mirage say they executives will continue to honor past corporate and employee commitments to the United Way.

"This is not about hurting United Way," Mathur said. "We've sat down with their staff and our staff. What we don't want to do at the end of the day is hurt the community."

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