Anita and I have always made a point of making sure that our children are generous with both their time and their money. We “force” them to volunteer with us at church, to donate to 501c3’s and to get involved with their communities. Invariably they complain about having to get up early on a weekend to rake leaves, or do a community car wash, but once we have finished they always have a great sense of satisfaction and fulfillment.
It is a fact that as humans, giving – whether it’s our money or our time – feeds our souls. In a recent newsletter I wrote that people that volunteer their time are 7 times happier than those who don’t.
American society gives some great rewards to entrepreneurs who are able to find what people need (or want), and provide it. This situation is in huge part thanks to the free market philosophy that has led to a lot of prosperity for some individuals, and whilst charitable acts are usually performed without the expectation of direct financial gain, they certainly are not without their own rewards (see below).
There are several reasons that corporations “give”, mainly to do with how it makes them look with their own employees and with actual and potential customers.
- Employee Morale
If a company chooses to make a corporate donation, workplace culture can improve with increased employee involvement and a positive general attitude. Millennial’s are the generation of social responsibility (also making up nearly 50% of the workforce) and according to a 2016 Deloitte study on volunteering, millennial’s were “twice as likely to rate their corporate culture as very positive” if their company participated in workplace volunteer activities. Many companies also have a “matching funds” scheme, whereby they will make a donation of equal value to a charity that an employee donates to. This obviously helps the charity financially, but also helps the employee to feel as if they are giving double the money.
- Marketing
Sponsorship is a great way to do good in your community, while also gaining marketing exposure. Sponsorship gets your company’s name out there, especially if you sponsor some kind of event – just make sure that the event, charity or person being sponsored mirrors your own company’s goals. Remember how quickly US Postal Service cut sponsorship ties with Lance Armstrong after his doping admission, or when Speedo withdrew swimmer Ryan Lochte’s sponsorship after he lied about being the victim of an armed robbery at the Brazil Olympic Games?
- Tax Deduction
Okay, not quite so sexy as the last two, but for a corporation being able to take a tax deduction for money paid or goods given is definitely an incentive. Besides which, unlike marketing and employee morale, the effect of the tax deduction is concrete and quickly felt.
- It’s Good for Your Community
Charitable contributions have numerous benefits, but the most important one is obvious: you should give back to your community. Charitable donations help better your community, and the public will notice if a company is making a real effort to improve its surroundings. If your core values include environmental awareness or sustainability, then you could donate to local parks or recreational areas, if you make musical instruments you might donate to the local opera, if you are a sports equipment manufacturer you could donate gear to your local Little League. Besides which A 2013 study by Cone Communications and Echo research revealed that a staggering 82% of U.S. consumers consider a company’s approach to social good when making a purchase. This is particularly true among two notoriously hard-to-reach demographics: millennials and moms.
- Connections
It may seem obvious when I say it, but “companies” don’t give away money, it’s the decision makers who own (or work) for the companies that give away money or goods. What might their motivations be? The truth is that philanthropy is the gateway to power. Philanthropic organizations are often a “who’s who” of the world’s most powerful individuals. Entry into these organizations brings one into contact with these people. For an entrepreneur or businessperson, these connections are an invaluable resource. The people you know determine what you can get done and what opportunities you can take advantage of. People in these organizations tend to develop a mutual trust and respect for one another, which are essential factors in doing business.
Successful corporate leaders understand promoting public opinions that are favorable to your company, boosting internal morale and improving the area you live in are all good reasons to make positive contributions to your community.
In 2017 corporate giving was nearly $21 billion (lagging well behind personal giving at $287 billion and foundation giving at $67 billion). Based on total US corporate profits of $2.1 trillion that means corporations only give about 1% of profits in charitable donations. By comparison personal giving averages about 2.8% of gross wages, which, interestingly, hardly changes irrespective of whether you earn $20,000 or $10,000,000 p.a.
I know that as an entrepreneur, it can be very hard to find time in your schedule to give back.
You’re struggling at a work-life balance, or figuring out the next step to propel you to success. When are you supposed to volunteer? I have a few thoughts on how you can combine the two. Below are five easy ways for you and your team to be giving back. Hopefully, you’ll make it a regular habit or, better yet, part of your company’s DNA to give back.
Talent. Your expertise and talent are often more valuable than your money. Identify a couple of impact organizations that you believe in and offer them one hour or one day of your expertise. You might evaluate their business plan, review their finances or help them with business development.
Time. It’s a fact, people who volunteer are generally more healthy. Create afternoons or days for your whole team to volunteer together.
There are websites like VolunteerMatch.com that can help identify a local need. Or you can reach out to an organization like Kaboom, Habitat for Humanity or CityYear that rely 100 percent on volunteers to build playgrounds, homes and fix parks.
You will be surprised how much it builds your team morale when you give back to your community.
Partnership. You can help raise awareness for a cause you are passionate about by creating a partnership with your company or with your own life.
Sophia Bush donated her birthday to Pencils of Promise one year, generating lots of attention for the organization. Maybe you could consider donating a month’s profits to a cause or creating a product to raise awareness. That will generate funds and lend credibility to the organization. That goes a long way to help, especially for smaller organizations.
Goods. We throw away things every day that someone else could use. Rally your team to bring in their coats, business clothes and electronics to donate to organizations like Dress for Success.
Money. Money is always a way to participate in a philanthropic cause. Big or small, every donation has an impact.
I have two requests. First, there are so many worthy causes out there, I urge you to take some time to explore those that mean something to you personally. Do you care about health? Education? Children? Sanitation? The environment? Whatever it is, it’s important that you connect to it in a meaningful way.
Second, look at smaller organizations.There are many large organizations doing indispensable work but it is harder for regular people like us to grasp the best way for us to plug into a United Way or Salvation Army.
Instead, I encourage you to reach out the small and medium sized organizations where your talent, goods, money or time will go a whole lot further. The smaller organizations also provide a way for your to see the impact of your do and give. That will motivate you to stay engaged for the long term.
To use a quote from Winston Churchill, “We make a living by what we get. We make a life by what we give.”
If you would like some more information about how you can get involved in your community and help out your local charities as well as your bottom line, give us a call at (440) 385 6737, or email us at contact@jagerconsulting.com.
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