In the News

The Business Case for Philanthropy

Most of us probably give back to our communities in one way or another. Whatever our reasons—we care about the cause, it makes us feel good, it connects us to our community, or even the tax advantages of larger or planned gifts—we benefit from our charitable activities.

Giving back through your business can be just as rewarding. In fact, a strategic corporate philanthropy program can benefit not just your community, but your bottom line.

What is corporate philanthropy?

Corporate philanthropy is an intimidating phrase that simply means you are using your company’s assets to support a charitable cause. In 2019, US companies gave $21.09 billion through grants, gifts, sponsorships and other giving programs.

Some companies have made a name for themselves with their giving programs, including large, multi-national businesses like Wells Fargo, Google, and Goldman Sachs. Others, such as Des Moines-based Raygun or Gillette, use their brand to raise awareness about issues in their communities. And still others like Cisco donate their product and expertise to help causes closely affiliated with their brands.

As a small business, your giving program can be as small or as large as you want it to be. And, you do not need to have a highly organized philanthropy department to make a difference. Grants and sponsorships, donating a portion of sales, employee-driven campaigns, gift matching and paid volunteer time off are just some of the many ways to support charitable organizations and causes in your community.

Why is it a good idea?

Corporate giving is not just good for your community, it is good for business. Supporting a charitable cause signals to customers that you are part of their community and creates customer loyalty. This is especially true of cause-related marketing—a specific type of corporate giving in which you work alongside an organization to raise money or awareness. In addition, giving programs are associated with better employee engagement and retention.

How do I get started?

If you are ready to start a business giving program, you will need to consider how it will be funded and what you want to achieve. Ensure you have a budget, strategy and ideally a designated person to manage it. You should also make sure that the program has guidelines that tie to your company’s values, brand and image in the marketplace. There can certainly be tax benefits, but there are also limitations, so make sure you have spoken to your tax advisor before making any decisions.

The most important thing to consider about corporate giving is what is the difference you want your business to make in the world. Just like your personal giving, corporate giving strengthens the community in which you do business. Ensuring your customers and their families have safe places to call home, food on the table, arts to inspire or thriving schools is not just good for sales, it is good—period.