Philanthropy is not something that only has to exist during the holiday season. Not only is it possible to integrate philanthropy into your business model year-round, but the long-term benefits of social responsibility outweigh the cost of donating a portion of your profits. How? Research found that 80% of customers are willing to switch to another brand that’s associated with a charity of their choice, according to Marti Beller in an article on Business News Daily. “There is virtually no downside to driving your business while impacting the greater good. It’s a win-win-win — nonprofits receive increased donations, customers feel connected and empowered, and businesses win loyal customers.”
There are three core benefits that social philanthropy can have on your company:
- Relationships. When you’re passionate about a cause, you can attract people interested in this same cause. Partnering with charitable organizations helps your company spread its reach even further than before- to people who may not have considered your company previously.
- Brand. Philanthropy builds and supports a brand (i.e., Toms). By giving back, you can evoke emotion and foster an authentic connection with your consumers.
- Employee engagement. Philanthropy as a core value promotes employee engagement, infuses passion in those around you and gives employees more energy and drive. After all, who doesn’t want to be a part of something bigger?
Though there is no golden standard for philanthropy programs, there are four common programs that companies typically offer:
- Matching gifts. Employees submit applications to their employer, requesting for their personal donation to a nonprofit to be matched by the company, which can potentially double or triple donations.
- Volunteer grants. Employees donate their time and efforts to a nonprofit and then submit applications for their company to donate money to that particular organization.
- No strings attached annual grant stipends. A set dollar amount which every employee is able to allocate to a nonprofit of their choosing.
- Matches for fundraising walks, runs, etc. Allows employees to raise money from friends and family, which is then matched by their employer. Similar to matching gifts.
One of the top philanthropic companies is Apple. According to Triple Pundit:
CEO Tim Cook became Apple’s head honcho in April 2011 and almost immediately instituted a program to match employee donations. In the time since, Apple has matched over $25 million worth of employee donations, resulting in more than $50 million for charities around the world.
In October 2014, Apple informed employees that it will expand its corporate giving program to include all countries in which it has a presence, which extends the program from U.S.-based nonprofits and a handful of organizations in other nations. Apple also announced that its volunteer grant program will give employees $25 per hour for their respective organizations.
Silicon Valley companies have been criticized for a lack of corporate philanthropy, although companies may just differ in how they donate. While Tim Cook is adamant about employees dictating where Apple donates, Facebook CEO Mark Zuckerberg separates his business from his philanthropy. He and his wife gave $120 million to help local schools in 2014, which demonstrates his propensity to acquire wealth and share it personally rather than to donate through corporate giving.
Apple will match employee donations up to $10,000 per year, and most 501(c)(3) organizations or equivalent organizations are eligible to receive matching gifts.
Social responsibility seems easy when it comes to large-scale corporations. Not only is there the financial backbone supporting your philanthropic measures, but the employee and consumer support. How are small businesses supposed to practice company philanthropy on a smaller scale?
- Emphasize the good. By focusing on the good that is accomplished when consumers purchase from your company, you are not only helping the nonprofit, but you’re helping your own company. Take TOMS, for example. This company has superbly woven their “One for One” into the foundation of the company, and it can be said that a huge portion of their success is due to this socially responsible model.
- Think local. Being involved in your community is critical for a company’s success. Have a day dedicated to volunteering at a local nonprofit with your employees. If you can, offer probono work to nonprofits.
- Publicize your accomplishments. Don’t be shy about your company’s philanthropic efforts. Not only does this make a good name for your company, but you’re once again helping the charity by publicizing their cause.
- Give your consumers options. People want convenient and simple ways to do good; they want to make a difference without having to track down and donate directly to each cause that’s important to them. By giving your consumers numerous options of causes that they can donate to (like Amazon accomplished with AmazonSmile), you can not only attract more consumers due to the versatility of your causes, but you can help more nonprofits.
Entrepreneur did a case study on Dancing Deer Baking Co., a Boston-based small business:
By partnering with nonprofit organization One Family to create the Sweet Home Project, Dancing Deer donates 35 percent of the retail price of all Sweet Home goodies and gifts toward One Family’s goal of helping homeless families move out of poverty. Specifically, the money supports scholarships that help homeless women complete their education.
Dancing Deer’s philanthropic efforts also provided an outlet for employees and consumers to connect with the company beyond just cakes and cookies. “At a basic business profitability level,” said former CEO Trish Karter, “you’re going to create a better brand and a better company if you give people something higher to aspire to than just turning a positive cash flow.”
A byproduct of Dancing Deer’s charitable giving has been improved marketing that pays dividends in customer loyalty. “The relationships with our customers are enhanced because they understand that we care about something more than just making money off the cookies we sell them,” Karter said. “There’s nothing wrong with making money. But it’s nice to add something else bigger and better to it.”
Any company, no matter how big or small, is capable of creating a culture of philanthropy. By incorporating it into the DNA of your company, you can succeed in your business and help make a difference in the world.