Papa John’s has launched a foundation focused on “equality, fairness, respect and opportunity for all.”
The move comes after the company has struggled with slumping sales, nourished by racially charged controversies and a months-long public spat with Papa John’s founder John H. Schnatter.
The pizza chain launched the foundation at Bennett College, one of the nation’s historically black colleges and universities, which, as the first recipient of a grant, received $500,000 to support the Stand With Bennett campaign.
Victoria Russell, the company’s chief diversity, executive and inclusion officer, told Insider Wednesday that Papa John’s launched the foundation because it did not have one, as its previous community giving had been tied primarily to Schnatter.
A lot of the company’s franchisees and employees for years have done work to improve their communities, she said, and through the foundation, the company is joining their efforts.
The creation of the foundation also sends the message that Papa John’s is making it a priority to empower the communities it serves, she said.
The new foundation also is providing grants to the Boys & Girls Club of America and the Association of American Colleges & Universities and is giving $100,000 to Lean into Louisville, an initiative with the city, “to support community dialogue and trainings on holding difficult conversations.”
Papa John’s CEO Steve Ritchie said in a news release that the foundation is about more than giving money.
“It’s about cultivating partnerships that empower communities as they work to overcome barriers to civility and unity,” he said. “As a company that is 120,000 strong, we are present in communities across the country. We’re thrilled to kick off this commitment and support better lives and better community for our team members, franchisees and customers across the country.”
Schnatter this month agreed to resign from the board after he and the company find a mutually acceptable independent director.
The embattled founder, who for much of the company’s existence also served as the company’s face in advertising campaigns, had suggested in late 2017 that the NFL’s failure to stop players from kneeling during the national anthem had hurt the company’s sales. Players were protesting police brutality and racial inequality.
The company apologized for Schnatter’s comments, and announced in December 2017 that he would step down as CEO.
Last summer, as Schnatter tried to regain control of the company, Forbes reported that he had used a racial slur on a conference call with a consultant. In late July, the company’s board adopted a so-called poison pill to thwart Schnatter’s takeover moves.
Throughout the controversies, Papa John’s shares and sales have continued to suffer, while the company has incurred significant costs.
In an earnings report this month, the pizza chain said that because of “recent events,” it had incurred special charges last year of more than $90 million related to, among other items, “re-imaging costs at nearly all domestic restaurants” as it removed Schnatter’s image from the company’s logo.
The company also said it lost nearly $14 million last year, as revenue fell 20 percent compared to 2017.
Russell said the location of the foundation’s launch, at one of the nation’s historically black colleges and universities, and the composition of the advisory board — seven of eight members are women, seven of eight are minorities — are unrelated to the company’s recent racial controversies.
“This is really about looking forward and doing better,” she said.
Russell said she could not share a dollar amount that the company had made available to the foundation, but said that grants would be announced periodically when the advisory board helps identify grantees. The foundation is not taking solicitations.
Russell said that the foundation’s work also would help the company’s business and talent attraction.
Millennials, who represent a large portion of the company’s customer and employee base, commit to organizations and companies that support their values in thought and action, she said. As customers vote with their dollars, the company has to make sure they recognize Papa John’s for more than just the quality of its product, Russell said.
And, she added, as the company recruits talent, prospective employees want to know that they’re part of a company with a vision beyond making a great product.
Once the employees and franchisees see that the company encourages them to get involved in projects that empower their communities and help people overcome barriers, they will form a deeper connection with both their communities and the Papa John’s brand, said Russell.