philanthropy

How Philanthropy Can Create an Impact for Your Business Beyond Profits

Philanthropy. Corporate giving. Social responsibility. These are a few of the different terms that are used by businesses to define their approach to giving back. Don’t be fooled by the jargon. All of these terms lead to the same result: using a business to leave the world a better place. 

Regardless of what you want to call your giving back plans, all philanthropic activities and charitable giving should be a strategic component of your businesses’ identity and, as such, incorporated into your annual plan.

Here are the benefits of implementing philanthropy into your business plan:

There are very few things in business that are a win-win for all parties involved. If done right, philanthropic activities can be beneficial for your business. Here are a few reasons how your startup could benefit from investing time and money in philanthropy: 

Public relations. Philanthropy can be a great opportunity to secure media coverage for your business. The media loves “do good” stories that not only showcase local businesses but also problems that are being solved by local leaders. If you choose to do good, don’t shy away from sharing the positive impact you’re bringing. Use your established communication channels (e.g., social media, newsletter, etc.), and send news releases to appropriate media contacts. 

Advertising. In exchange for support, organizations often offer businesses the opportunity to receive “free” self promotion, showcasing logos and websites, among others. For example, if you’re interested in supporting a local team, there may be an opportunity for you to receive stadium or program advertising as part of your donation package. Keep in mind that if you receive something in exchange for your support, you may not be eligible for tax credits. You’ll need to weigh the pros and cons of each scenario to determine what is best for your business. 

Tax incentives. If you’re interested in giving back, take time to run your ideas by your business’ tax professional. Depending on the activity, there may be tax incentives associated with your chosen activities. 

Attract employees and customers. Giving back affords another opportunity for individuals to consider working with and supporting your business. Depending on how much you highlight your philanthropic endeavors, you may be able to attract employees and customers. 

Team building. The nature of philanthropy is to bring people together for a good cause. Having a charitable arm in your business is a great way to reinforce the good your team can do beyond your bottom line. 

How to give back 

Philanthropy isn’t a templated business component. Every business owner has their own thoughts on philanthropy and chooses to give back in their own way. 

The first thing that usually comes to mind when thinking about being philanthropic is a charitable donation. According to a study conducted by American Express and The Chronicle of Philanthropy, small companies donate an average of 6% of their profits to charity. As a startup, perhaps a monetary donation is possible that time or maybe it’s just not in your business’ best interest. If that’s the case, or you’re just interested in being a bit more hands on when it comes to giving back, consider these options: 

Volunteer. Many organizations are actively seeking volunteers to dedicate time to ongoing or one-off projects. The list of ways to volunteer is long, and the amount of time you can commit will vary. If you’re interested in volunteering, figure out what you’re feasibly capable of doing, both in activity and time, and connect with the organization’s volunteer coordinator to see if it’s a good fit for everyone. Rolling up your sleeves and volunteering is a great way to not only see the impact you’re making but also to meet other like-minded people who could become customers, employees, partners or friends. 

In-kind donations. Leverage your business’ products or services to help others. One of the easiest, and most often affordable, ways to give back is to do what you do best free of charge. For example, if you own a print shop, consider printing collateral for organizations in need. Or, if you have a service-based company, set a select number of hours to provide pro-bono services. 

Host a fundraiser or drive. Give your employees and/or customers a chance to get in on the giving by creating a fundraiser or hosting a collection of items that can then be donated to an organization in need. Most organizations that collect donations have a wish list of items that are most needed. 

If a monetary donation won’t work for your business, look for ways to replace activities or items in your business with ones that support organizations you’re passionate about. Here are two examples of how you make this happen in your business: 

Holiday donations. Consider replacing the holiday gifts you send to clients, investors or partners with a charitable donation to a cause that aligns with your business’ interests. I’m confident that your contacts won’t miss the bottle of wine, chocolates or swag as much as they will love knowing that you’re doing good in the world. 

Team building. Keep philanthropy front and center by offering employees a set number of hours off each year to volunteer at select organizations or host team building activities that go beyond just getting everyone getting and allow your team to get involved, give back and grow together. 

If you want to give back but don’t have the time to dedicate to ideation and creation, consider reaching out to another local business in your area or your chamber of commerce to see what its plans are for philanthropy. There’s no shame in jumping on somebody else’s philanthropy plans as long as they align with your business. 

Regardless of how you decide to give back, it is important that you do your research on the organization you will support before you commit. The charities you associate your business with hold just as much weight as the vendors and partners you have, so it’s important that you fully understand who they are, how they operate and how your donations are being used. 

Break away from the crowd 

Many small business owners truly enjoy giving back. Because of this, timing around the holidays often becomes crowded with competing “do good” activities. To afford your activities a true moment to shine, consider executing your activities during other times of the year. For example, if you’re interested in hosting a drive to collect winter coats, consider launching the drive in early October, encouraging folks to donate now and buy themselves a new one for the upcoming season. Thinking outside the box or jumping on an activity before others do is the best way to make sure you don’t get lost in a sea of good. 

It’s OK to say “no” 

Investing time and money into a charitable cause that aligns with your business can yield great results for your business. However, it is important to remember you can’t and shouldn’t do it all. 

Throughout the year, you may be contacted by different organizations asking you to make donations or provide in-kind support. You need to make sure you evaluate these opportunities and review the organizations that are requesting support before agreeing to help. It is vital that any organization your company is associated with is reputable. 

Remember, you’re operating a business, so if the charitable activity doesn’t make sense for your business or it’s not the right time, it’s OK to say no. Your business and cash flow needs to be top priority, even if you really want to give. 

Key takeaways

One of the biggest components of a successful business is planning. The philanthropic endeavors your business chooses to be part of, align with and execute are no different. You need a plan. 

Take time to mull over the options; bounce ideas off of your team, your friends and your family; research organizations; and review what other businesses have done. Most of all, make sure your business is ready and able to give back. 

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