Corporate Philanthropy: What Your Business Needs to Know
With social activism and ethical business practices taking center stage in national conversations, it makes sense that corporate social responsibility (CSR) and corporate philanthropy programs are on the rise. Instead of just selling valuable products and services, your business is now expected to take an active role in social causes.
In fact, according to a Cone Communications study on CSR, 63% of Americans hope businesses will take charge in driving social and environmental change in the absence of government regulation. Corporate philanthropy is increasingly becoming less of a “nice-to-have” offering and more of a “must-have” element for businesses to keep up with consumer desires.
But while your organization may be facing pressure to implement these programs, you don’t have to view them as a burden. In fact, if implemented correctly, your corporate philanthropy programs can be a driving force for customer loyalty, cause marketing, brand awareness, and employee engagement.
This guide will provide a roadmap for marketing managers, community giving managers, and HR professionals taking the dive into the world of corporate philanthropy. You’ll not only learn what corporate philanthropy is and its different types, but how to start a successful CSR program of your own by going over the key essentials of CSR, including:
No matter your business’s products or services, these strategies should help you take action and launch your own robust corporate philanthropy program. Let’s get started with a brief overview of what corporate philanthropy is and what it might look like for your business!
What is Corporate Philanthropy?
Corporate philanthropy is the voluntary actions that businesses take to improve their impact on the environment, their communities, and society at large. These programs have become incredibly popular in the business sector, with over $21 billion in corporate gifts given to nonprofits last year alone.
This may seem like a hefty investment to please your customers, but the benefits of corporate philanthropy go far beyond presenting a positive image for your business.
For instance, corporate philanthropy can provide an essential boost to your employee engagement rates. Over 71% of employees say it is imperative or very important to work at a business where the culture supports giving and volunteering.
This statistic might seem surprising if your idea of corporate philanthropy is just cutting a check to a local charity. For many people, the first idea that comes to mind when thinking of philanthropy is a cash donation. But there are a variety of different corporate giving programs that provide aid to nonprofits in different ways—which we’ll later discuss in more depth.
How Corporate Philanthropy Benefits Businesses
You may wonder if the cost of investing in corporate philanthropy is worth the benefits. After all, every single one of the corporate philanthropy programs we’ve discussed, with the exception of in-kind donations, involves donating money to an organization without necessarily receiving anything tangible in exchange.
So, how can corporate philanthropy strengthen your business and earn back its return on investment?
In addition to providing crucial support to worthy causes in your community, corporate philanthropy offers businesses many advantages such as:
Increased employee engagement. As mentioned earlier, corporate philanthropy can significantly improve employee engagement and retention rates. This Re:Charity report on corporate giving shows that employees who engage in corporate giving programs tend to have 75% longer tenures with their employers. The message is clear: your employees want to be a part of a business that improves their communities and creates change beyond the walls of their office. Your corporate philanthropy programs aren’t just for public vanity—they can and do create real, positive changes in your work environment’s quality and overall team member satisfaction.
Better engagement with customers. In an age when mass media is instantly available at everyone’s fingertips, customers have become increasingly mindful of the companies they support through their purchases. As quickly as bad news about a company will spread, good news about your company’s involvement in charitable causes will also reach customers. In fact, 87% of customers will purchase a product because a company advocated for an issue they care about.
A marketing and reputation boost. When you partner with nonprofits and other charitable organizations, you can expand your marketing reach. These joint efforts, such as charitable events or fundraisers, expose both of your organizations to audiences that may have otherwise been difficult to reach. Additionally, these activities can lead community members to view your organization as a philanthropically-minded force for good. For example, this America’s Charities workplace giving survey shows that 69% of respondents reported increased sales after launching CSR programs.
Creating an effective cooperative giving program may require a bit of investment, but it will more than make up for the initial planning and donations required to keep these initiatives running.
For example, Six Flags North America has used its corporate philanthropy program to engage employees, partner with community leaders, and create a sense of customer loyalty that will last a lifetime. From its Project 6 program to its Make-a-Wish sponsorship, Six Flags has leveraged the power of in-kind donations to share thrilling theme park experiences with children and community members in need, cementing itself as a pillar of social good in its communities.
Types of Corporate Philanthropy
Corporate philanthropy programs can vary widely depending on a business’s industry and community engagement goals. Just as each business’s day-to-day operations, products, and services are different, every corporate philanthropy program will work differently.
That being said, there are several common corporate philanthropy initiatives, including:
Monetary Donations
DIRECT MONETARY DONATIONS
Direct monetary donations, sometimes structured as grants, are payments that your organization makes to nonprofits. This is one of the most common and straightforward forms of corporate philanthropy.
Direction donations can be as simple as writing a check to a charity. Alternatively, you could partner to contribute a portion of your sales during a given time period to a designated nonprofit or host an ongoing donation drive.
MATCHING GIFTS
Matching gifts are donations that businesses make to match their employee’s monetary contributions to charitable causes. This allows you to engage your employees on a one-on-one basis, showing support and giving to organizations that each of them finds personally important.
The process of actually facilitating these matching gifts is usually a shared, online exchange between your matching gift system and the nonprofit’s matching gift database software, where:
Your employee logs into the nonprofit’s donation page to submit their gift.
Employees search for your company’s matching gift form through the matching gift database embedded in the donation page.
Employees can automatically submit a request for you to match their donation.
The ratio and maximum amount of these matches vary for each organization. For example, many businesses offer 1:1 matches, but some provide 2:1 or even 3:1 matches.
However you go about setting up your match ratio or your matching gift form, just be sure to make sure that employees know about the program!
SPONSORSHIPS
Corporate sponsorships are a form of corporate philanthropy where your business supports a nonprofit during an event or specific fundraising effort.
This time-based type of philanthropy is flexible and can be mixed and matched with other philanthropic initiatives, such as a holiday direct donation campaign, to build up a more concentrated wave of support. Consider implementing sponsorships into your current corporate philanthropy program to complement and enhance your other campaigns.
In-Kind Donations
IN-KIND DONATIONS
In-kind donations are the donation of goods, experiences, or services rather than money.
For example, DonationMatch has helped many product-based businesses donate their extra inventory and product samples to charity events, turning unnecessary overhead into a marketing opportunity.
On the nonprofit side of the engagement, these charitable organizations are able to get in touch with businesses and immediately receive valuable or otherwise unattainable items that can be put directly towards fundraising for their mission.
Even businesses that don’t sell physical products, such as the Chicago Museum of Contemporary Art, have been able to participate in in-kind giving by donating tours, tickets, and valuable experiences to local community programs.
SPONSORSHIPS
As we mentioned, corporate sponsorships involve your business offering support to a nonprofit during a specific event, campaign, or project. For instance, you might donate dining gift certificates to be put up for bid at a charity auction or send employee volunteers to help facilitate a 5K.
Corporate sponsorships intersect with several other types of corporate philanthropy. For example, donating those auctionable gift certificates would count as both a sponsorship and an in-kind donation program.
You can pair corporate sponsorships with all of the other types of corporate philanthropy on this list to create a concentrated, time-sensitive campaign that will bring attention to your philanthropic efforts.
talent donations
VOLUNTEER GRANTS
Volunteer grants are contributions that employers make to nonprofits that their employees have volunteered with for a specific amount of time.
Volunteer grants, volunteer grant funds, or dollars for doers programs are a particularly effective way to engage your employees, rewarding them for actively helping charitable missions.
No matter the most compatible corporate philanthropy program, be sure to choose one or two well-suited nonprofits with which to create ongoing partnerships. As you learn more about your nonprofit partners, you can understand what types of donations and giving initiatives are most helpful for them.
Additionally, partner with charitable causes that align with your business’s mission or sector. Doing so will help create a more consistent, positive public reception of your brand. Before getting started, be sure that your business has the right tools to find the best nonprofits for your philanthropic partnership.
5 Steps to Create a Corporate Philanthropy Program
Launching your own corporate philanthropy program can be difficult without a bit of guidance. The DonationMatch team has had years of experience organizing and facilitating in-kind corporate philanthropy initiatives for businesses, and with these fundamental strategies, you should be well on your way to starting your own program:
1. Establish your goals.
Before you decide what type of corporate philanthropy program to pursue, you need to establish your CSR campaign goals. Think about what you’re hoping to gain from your campaigns, such as increased employee engagement or a reputational boost. Only then can you really begin to build out your corporate philanthropy program.
Here’s how you should walk through the goal-setting process:
Determine target benefits. What are you looking for in your CSR program—employee engagement? Brand exposure through cause marketing?
Assess CSR strategy’s compatibility with your business. How does the giving program you’re considering help you achieve the goals in step 1? Are there other types of corporate philanthropy that might be more beneficial for your target goals?
Establish specific return on investment markers. In other words, figure out what specific key performance indicators (KPIs) you can measure to assess whether your program is doing well. We’ll touch more on this later.
For example, if your main goal is to create a more active and more public partnership of giving between your business and community organizations, then an in-kind donation program may be the best fit for you. By contrast, if you want to improve employee engagement, then a matching gifts or volunteer grant program may provide better results.
2. Gather the necessary technology.
Gathering the right tools is a must for building your corporate philanthropy program. While smaller businesses may be able to run a rudimentary corporate giving program through manual means, CSR software tools can optimize your campaigns and maximize their effectiveness.
To ensure that your program will run smoothly, reach the widest possible audience, and facilitate relationships with the right nonprofits, invest in these software solutions:
In-kind donation portal. There are thousands of charitable organizations and nonprofits that are eager for your donations. However, qualifying and choosing organizations that are well-suited for your program is a far greater challenge. Fortunately, an in-kind donation platform can help. This tool allows you to cut through the clutter and match your business with qualified nonprofits that meet the specific criteria that you’ve entered, which may include location, cause type, and supporter demographics that match your own customers.
Communication platforms. How you communicate with your customers and employees about your philanthropic initiatives can determine your program’s success. For example, a volunteer grant program won’t succeed if no one in your organization is aware that you are offering grants. Leverage communication platforms, such as your email marketing tools and social media strategies, to promote these opportunities.
A tracking and reporting system. Data tracking and data reportage are two of the most fundamental tools necessary for tracking your program’s performance. This data will show you where your program can improve and where you’re doing well. For instance, tracking data for your in-kind giving program will allow you to determine which nonprofit partnerships have been the most rewarding and what products you should continue to allocate to your partners.
Investing in these tools may seem like a costly investment. Fortunately, there are comprehensive platforms that can help you achieve all of these goals.
For example, the DonationMatch platform is able to automate and streamline nearly every step of the in-kind giving process, from partnership matching to facilitating donations and performance tracking.
When you begin searching for your own corporate giving tools, look for effective, turnkey platforms that centralize all of these features into one or two powerful solutions.
3. Connect with nonprofit partners.
Finding nonprofit partners that fit your corporate giving goals can be a challenge.
The number of nonprofits you want to engage will greatly influence the reach and depth of your campaigns.
Here are a few key features you should consider when choosing your nonprofit partner:
Years in operation
Community reach and impact
How their mission aligns with your business
Past corporations they’ve partnered with
What types of programs they might be open to
If a deeper, long-lasting, integrated relationship is desired, take your time to choose the right partner and foster a relationship. If you want to maximize brand visibility and reach, then engaging more organizations with a turnkey program will be more effective. The beauty of these programs is that you can do both. For instance, as we mentioned earlier, Six Flags North America chose to partner with Make a Wish to nurture a robust and highly beneficial relationship over years, yet continues to donate tickets to thousands of charity fundraisers each year.
4. Build excitement around your initiatives.
Your corporate philanthropy programs may serve a practical purpose, but that doesn’t mean that they can’t be fun and engaging. In fact, that’s one of their most important benefits!
Stir up excitement amongst your employees and customers by:
Gathering employer and customer feedback
Promoting your initiatives during team gatherings
Creating an employee and/or customer-led corporate philanthropy council
Sharing information about your programs on your company website
This will help to better guarantee that your programs will perform successfully and make the most positive impact!
5. Track your progress.
We’ve said it once and we’ll say it again: data tracking is one of the most fundamental parts of running an effective corporate philanthropy program. How else will you know how to avert failure or repeat the success of past campaigns?
Track the following key statistics to help measure the impact of your program and the level of engagement:
Total contributions annually
Participation rates (such as who took advantage of matching gifts!)
Changes in rates of employee retention and overall satisfaction
Changes in rates of customer retention and overall satisfaction
Changes in sales and net revenue
Changes in sources of new customers
Associated costs, savings, and ROI
Expressed feedback and appreciation for giving programs (through survey responses)
These essential metrics should give you a good starting point, but you’ll want to sit down with your team to decide what data points from your campaigns you should focus on. After all, your own corporate philanthropy is unique, and will have its own unique goals and objectives.
Wrapping Up
Appealing to your customer base, engaging employees, and positively promoting your business are worthwhile goals to strive for. The social changes that have begun to rock the corporate world have only accelerated the rise of corporate social responsibility as a necessary cornerstone of your business practices.
With this guide and the right, intuitive corporate giving tools, take your business one step closer to launching your own effective corporate philanthropy program.
For more information on corporate philanthropy, different CSR programs, and DonationMatch’s solution to corporate philanthropy, check out these additional resources:
Top 3 Things Donating Can Do For Your Business. Take a deeper look into the benefits of corporate giving and how it can generate greater exposure, customer loyalty, and even increased revenue for your company.
Corporate Philanthropy Made Easy — DonationMatch. DonationMatch is dedicated to your corporate philanthropy endeavors. Explore how our turnkey platform has revolutionized the in-kind donation process.
Workplace Giving: Explore Matching Gifts From the Other Side. Employee engagement is a high priority for all corporate philanthropy programs. Dive into tips, tools, and software solutions to initiate your workplace giving campaigns and engage employees.