Profile: Beyond Toys
Michael Goldstein, former CEO of Toys 'R Us, has segued his corporate success into a charitable empire.
Toys 'R Us is a fixture of the American landscape. With over 1,500 stores and sales of $11 billion, it is the largest retailer of toys in the world.
From 1994-98, Michael Goldstein served as President and CEO of Toys 'R Us; he was Chairman until June 2001. Now Goldstein runs the Toys 'R Us charitable foundation.
Goldstein is convinced that business exists to serve the public interest, and that the best way to "do well" is to "do good." While he is not in these convictions, he is in the extent to which they have shaped his personal and public life. Aish.com interviewed Goldstein in his New York office.
How did you get started in business?
I decided early on that I was going to work very hard, that I was not going to have people push me around, and that I was going to have enough money to live a better life. I was a very ambitious student. I finished college with straight A's, Magna cum Laude.
After graduation, I pursued a job with the Big Eight accounting firms, but I kept getting rejected. One of my neighbors was a successful accountant, and he explained that "the quota was probably used up." In other words, they had enough Jews in the admission group as new accountants. I was heartbroken.
So instead, I took a position with a large Jewish accounting firm, and it turned out to be the best move I could have made. Though I didn't know it at the time.
Okay, you've got our interest. Why was this such a great move?
Because it opened me up to the larger picture of life. The head of the firm was a fellow named Harry Mancher. He was my mentor, someone I really respected. When I became a partner, he required that I become involved with a charitable organization, donating my time and money. This was something I had no concept of whatsoever. I was 32 years old with two children, and it was tough making ends meet.
They said, "Don't worry, we're not looking for your money. We want your expertise."
I became a board member of Manhattan's 92nd Street Y. I remember trying to explain to the board members, many who were extremely wealthy, that I was early in my career and couldn't write a big check. They said, "Don't worry, we're not looking for your money. We want your expertise." It turned out to be a great learning experience for me, a wonderful first step. Since then, as I became more successful and made more money, I have consistently looked for ways to give back.
What factors moved you out of the Toys 'R Us corporate side, and into the charitable foundation?
Some years ago, friends from Bear Stearns suggested that I spend one hour each week learning Torah with a rabbi from Aish. I was going through a difficult time. I was considering retiring from Toys 'R Us, and I didn't want to work full-time anymore. Yet I didn't know how to give up a job like this. I found the hour of Torah study very rewarding -- intellectually and spiritually. Not at all like my Hebrew school education with all the memorization and Hebrew, and not knowing what any of it meant.
My life was always motivated by the ambition to succeed. But the weekly Torah study got me to focus and ask: "What do I want to do with the rest of my life?" It was the first time that I really sat back and asked that question. And I realized that what I wanted to do with my life was to raise money and help children. And I realized that being CEO of Toys 'R Us wasn't really that important to me, except for how it would help me achieve this other goal.
I realized that being CEO of Toys 'R Us wasn't really that important to me, except for helping me achieve other goals.
The big question mark when I left as CEO was whether I would still have the clout to accomplish what I wanted to. It turned out for the best. During my career, I've helped so many people with their business, and given so many people a shot, that when I began making contacts for the charity work, just about everyone became a willing participant.
Give us an example of how you've leveraged your business contacts to raise more money?
Well, I wanted to meet with Rosie O'Donnell, because she is one of the most influential women in the country. I was given a 10-minute meeting. Rosie can be gruff, and she was skeptical about Toys 'R Us profiting commercially from her. I told her, "All I want to do is work with you to raise money for kids in need. With your celebrity status and my business expertise, we can raise lots of money." At the end of those 10 minutes, we shook hands on a deal.
Today, four years later, her children's foundation has raised almost 50 million dollars, which we disperse directly to childcare organizations. Whenever Rosie does a commercial or other special event, all the money goes right into the foundation. We've created an advisory board consisting mostly successful businesswomen -- the heads of eBay, Avon, and Mattel. We now have the goal of getting the endowment up to 100 million dollars.
Besides offering your business expertise, how do you get involved personally?
Through a program in New York, I'm principal for one day each year at P.S. 107 in Queens. There's a little girl named Cheyenne, who has spina bifida, who I met when she was in kindergarten. The New York Times had followed me on a visit to P.S. 107, and the theme of the article turned out to be me and Cheyenne. She was in a wheelchair eating lunch, the two of us were chatting, and The Times was snapping pictures.
She is very sweet and mature, and we got to be friends. She happens to be very beautiful and photogenic, so I've set her up with a modeling agency, and she'll be modeling in Toys 'R Us catalogues. One of the things we started about 15 years ago in our catalogues is to show diversity in terms of color, gender, and physical challenges. Early on, we included children with Downs Syndrome, and we've gotten accolades for it. The models are paid on a nice scale, so it helps a bit with some of the expenses that a girl like Cheyenne has with such a serious disability.
I'll bet you've got more stories like that to share.
Well, through Rosie, I visited an orphanage in Harlem that takes in infants who are abandoned, or whose parents are in prison or rehab. I was introduced to a little girl, Esther, who at the time was four. She was a doll, with a smile and energy that made you instantly fall in love with her. It turned out that Esther was one of three sisters. Both parents had died of AIDS and they had no one else other than the orphanage.
I liked Esther a lot, so my wife and I took her to the Museum of Natural History. My wife loved her, too; she understood what intrigued me about Esther. On the ride back, Esther said that she had a great time... "but why didn't you take my sister Blessing?" So we started to take both children. I would visit the orphanage to read to them, bring them clothes and toys, and take them out to dinner. Soon they said, "What about our sister Rose?" So we all went to the zoo and many different places together. We sent the three girls to summer camp, and they were the hits of the camp. But I was careful not to spoil them. It became a wonderful friendship.
These kids will always remember that there was someone there for them when they were alone.
We thought of adopting them, but we decided they really should have younger, African-American parents. Eventually someone wanted to adopt them, and the orphanage arranged a going-away party for the three kids. When their new mom came, the three kids ran over, hugging her, calling her "mommy." It was unforgettable. It's great that they're now part of a family, and these kids will always remember that there was someone there for them when they were alone. These kids are very special; they're going to be proud members of society.
That's amazing personal satisfaction. Let's talk some about the corporate world. Is there a conflict between the business of making money, and making the world a better place?
I think there's a misperception. Neither of my daughters has any interest in business, and I remember being criticized after my younger daughter read different articles about corporate greed. She said "Dad, you're what's wrong with this country!" I understand what she meant. Society is a bit crazy in what we pay celebrities, and CEO's are in that class. Yet we're not willing to fairly compensate people who are important to society, like teachers and social workers.
But I think business is what makes the world go round. Having a strong economy is good for individual quality of life, and is also a key to building good relations between countries.
I think that because of our ability to generate money, business people have a tremendous obligation to help develop social programs, to give these programs the opportunity to expand, and to make sure they offer competitive wages in order to attract quality people.
How can corporations get involved directly?
At Toys 'R Us we did some things that made us a better company and also benefited society. Early in my career we were not paying enough attention to the safety of certain toys. So we made a decision to improve our safety standards, because we don't want any child getting hurt with a toy. Besides being the right thing to do, it's also good business because you'll have less rejects and returns, and an overall better reputation with customers. So we developed a very extensive safety program with much greater testing, and about six years later the Consumer Product Safety Commission commended us with their award of honor.
We decided to stop selling toys that could be mistaken for real guns.
Another example is toy guns. About 10 years ago a boy was shot and killed by a police officer. The boy had a toy gun, and the police officer mistook it for a real gun. It was a terrible tragedy and it really had an impact on me. I went home that night and spoke to my wife and kids, and I went back to the office the next day and talked about it with key company executives. We decided to stop selling toys that could be mistaken for real guns. It took a few weeks to phase them out, because we wanted to be fair to our suppliers and give them a chance to come up with other items we could buy, so as not to hurt them financially. The Wall Street Journal got wind of it and we ended up with tons of positive publicity. But that wasn't the purpose.
With so many stores worldwide, how can a business such as yours give back to the communities you operate in?
At Toys 'R Us we've instituted a hospital playroom program. We found that hospitals playrooms were very run-down, and that it was difficult for hospitals to fundraise to improve their play space for kids. At the same time, child psychologists were saying how important it is for children to have some place where they can escape the pain, the suffering, and the scare of being in a hospital. So we instituted a program where we now have beautiful playrooms in about 70 hospitals. We maintain them and add toys on a regular basis.
If you could go back 30 years and give yourself some advice, what would it be?
I missed a lot of my kid's childhood and I regret that. It goes by so fast and there's no way to replace it. Now I have a grandchild, and I'm not going to let that pass me by. I think for many of us, business becomes 24 hours a day. You're always thinking business. I really wasn't there for my kids. My daughters felt cheated. I wish I had taken time off when my children had a play or special event. Maybe my charity work is making up for some of that.
I would like to see a shift in the corporate world on this. I think any employer that doesn't encourage family time is making a mistake.
What else have you learned from your struggles?
When I was having difficult times because Toys 'R Us wasn't doing that well, a wise person said to me, "Do you know anyone who's smarter than you are, and more hard working than you are, yet has not succeeded the way you have?" I said, "Yeah, I know lots of people like that."
He said, "Do you also know people who have succeeded beyond your wildest expectations, and yet are not as smart or as hard working as you?" And I said, "Yeah, I know lots of them, too."
He said, "Well, now you know there's something to success beyond just hard work and brains. There are other forces, like God."
Once I understood that, I realized that so much of what has happened in my life is what God has decided. I'm playing out a role, and it's not all in my hands. So for me, I just want to play it out as best I can.