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Pledge 1
Community Manager
Community Manager


Original article here



If you take a quick scan of recent headlines about corporate ESG momentum, you’re likely to see the word “trend” popping up time and again. It’s a word that could falsely imply the ESG movement is fleeting. But in fact, all signs point to permanence, with more ESG requirements poised to become mandatory in 2024 and beyond.   


None of this is surprising. Investing in environmental, social, and governance (ESG) initiatives is the right thing to do for people and the planet. It also appears to be a sound performance strategy that helps to attract and retain talent—particularly as millennials and Gen Z become more dominant in the workforce.  


The big question on the minds of many founders is not whether to embrace philanthropic leadership, but rather when is the right time. The answer might surprise you. 



Back in 2021, my company, Coveo, joined Pledge 1%, a global movement to inspire, educate, and empower all companies to leverage their assets for good. The movement challenges organizations to pledge 1% of equity, 1% of employees’ time, 1% of profits, and 1% of technology capabilities. While our pledge date may not appear noteworthy on the surface, that changes when I reveal that we took the pledge during the run-up to our IPO.  


Pledging equity on the road to IPO might feel off-limits, whether due to concerns around bandwidth, board pushback, investor dilution, or even the misconception that it’s too late. In fact, founders at many companies, including DocuSign, PagerDuty, and Twilio, all successfully spearheaded Pledge 1% commitments within a couple of years, or even a couple of months, of their own IPOs. 


Not only is it possible to take action pre- or concurrent-IPO, it’s also much simpler to get shareholder’s approval. The upsides are plentiful, including the amazing potential to create billions of new philanthropy dollars that can be used to address significant societal issues for years to come. But just because it’s possible, doesn’t mean everything is simple. 


The good news is you don’t have to go in blind. Here are five takeaways from my team’s experience with committing to Pledge 1%.




1. Get Your Board Aligned And Onside  

Leaders who have been through the Pledge 1% process recommend meeting with each board member individually so you can connect and communicate with them in their preferred manner. I support this approach, as it allows you to feel out reactions and address questions one on one.  


My company’s board was unwaveringly supportive of joining Pledge 1%, even given the timing. We were also fortunate to have a board member who had already participated in Pledge 1%. That individual’s support was invaluable throughout the process. 


2. Think Long Term 

The decisions you make early on are binding for years, so it’s crucial to make informed choices and consider all the regulatory complexities. For example, as a Canadian company, we faced constraints related to stock legends in the U.S. Fortunately, nothing proved insurmountable. 


Your equity source can be corporate, founder, or a hybrid. We committed to a corporate upfront model with a sale schedule over multiple years. “Upfront” means investor dilution happens all at once and the full amount is on the cap table. This approach could allow you to benefit from stock upsides and speak confidently about your commitments, knowing your philanthropic vision is protected from management changes or M&A activity. 


3. Surround Yourself With Experienced Advisors 

Tax considerations weren’t a primary concern for us, but yours may require proactive measures to receive charitable receipts. Surrounding yourself with tax, legal, and accounting experts with Pledge 1% experience is a sound strategy, as it helps you avoid unnecessary expenses and time.  


We also decided to partner with donor-advised funds, or DAFs, in the U.S. and Canada rather than setting up a private corporate foundation. This allows us to more easily give back to local communities where most of our employees and customers are based.


4. Tap Into The Expert Tools 

The Pledge 1% program provides access to tools, networks, and expert guidance from its team and founders who have been through the process. Standing on the shoulders of these giants can help to significantly streamline the implementation process, particularly amidst the madness of IPO preparations. 


5. Identify An Owner  

Being part of Pledge 1% centralizes ESG efforts, easing reporting and coordination. Identifying a passionate in-house owner helps to drive long-term success. Even smaller companies that can’t invest in a dedicated senior impact executive can do this. For example, we’re fortunate to have our CMO leading our ESG efforts and rallying 50+ employees to join the committees. 



At Coveo, we chose to be part of the Pledge 1% movement because it provides a proven, sustainable way to fund our social impact for years to come. It’s also an amazing way to keep us laser-focused on a mission that is highly meaningful to our organization and our people.   


We put knowledge and education at the center of our 1% Pledge because we passionately believe that education is the ultimate social equalizer. Our initiatives prioritize programs for young people aged 6-18 years old in vulnerable social groups who are challenged with accessing knowledge and education. We’re already making great strides.  


Since taking the pledge in 2021, we’ve donated more than a million dollars, plus thousands of employee volunteer hours, to worthy causes. Achieving this milestone wouldn’t have been possible without the willingness of our leaders and board to explore joining Pledge 1% while on the road to IPO.  


I hope the insights I shared in this article ignite meaningful discussions about how to build a long-term liquidity vehicle for supporting organizations aligned with your company’s mission. The more late-stage companies that join Pledge 1%, the faster we can make meaningful corporate philanthropy the new normal.