Purposeful Corporate Giving can Transform Communities
In a world where “karmic capital” is perhaps most obvious in the form of for-profit social ventures like kicks-maker TOMS, what’s a comparatively conventional bank, grocery chain or software company to do? Following a study of the value of corporate giving on company performance, Ilya Cuypers, Assistant Professor of Strategic Management at Singapore Management University, points out in an SSIR article that “how companies give has a bigger effect on their financial performance than how much they give.” In fact, corporate philanthropy embodying the characteristics of innovation, sincerity and genuine engagement outperformed higher-dollar giving by 2.8 times when looking at the impact on a company’s financial gains and public perception.
Companies that ring in at the top of the do-gooder charts give community impact a seat at the table—as a co-pilot to business strategy—and integrate it into the fabric of company culture. This intentionality is a shift that’s making waves on two fronts: company profits and community progress. We’ve all heard of corporate social responsibility (CSR), and while the term is a kitchen sink of sustainability- and regulatory-related factors, ultimately it’s about conscience and citizenship—and that’s why philanthropic activity is at its core. Now more than ever, companies are moving their CSR practices from the periphery of what they do to the core of who they are. When done well, it personifies companies and even makes them more likable.
The more a company authentically and actively engages in social impact initiatives, the more community problems actually get solved. Not only is this great for the causes a company supports, it can be rocket fuel for a company’s bottom line. Ultimately the big winners in corporate giving are companies that do it with purpose. How does a company cultivate that without compromising the very reason for their existence? Here’s a few ideas:
Select Wisely
By making philanthropy part of your company’s purpose, you make headway in an area related to your company’s focus and promote your impact in a natural way. Take, for example, Google’s support of STEM (science, technology, engineering and math) programming. Fundamentally linked to Google’s core profit-generating purpose “to organize the world's information and make it universally accessible and useful,” this is the stuff of genuine community transformation. Here at Mission Capital, we call it “engaged philanthropy”—the kind that moves beyond check writing into a more informed, whole-person giving experience.
Invest in Employees
Employees who understand what their community’s issues are, and how to help solve them, are more likely to give and give purposefully than those who aren’t informed or empowered. When employees engage in social impact initiatives, they’re an extension of your brand. Thus, it’s in a company’s best interest to create meaningful community engagement experiences and provide educational opportunities in support of them. By doing so, a company’s giving culture is catapulted off its sidelines—becoming more intentional, sincere in purpose and innovative in function—and engages its employees in powerful, problem-solving philanthropy that, over time, also builds brand reputation, boosts profits and reinforces talent retention. Here are a few ways to get started:
Bring in an expert to offer training on the local social impact landscape, the fundamentals of nonprofit board service or how to vet an organization’s effectiveness.
Underwrite an employee’s hands-on engagement in the community.
Let your employees lead the way. Listen to their interests, offer a matching grant program to multiply the impact of their personal giving/volunteerism and involve them in corporate giving strategy discussions.
Austin is rich with purposefully community-minded companies—and we need more of them.