How to start a corporate philanthropy program

Corporate philanthropy is just one component of a strategic corporate social responsibility program, but it is a a powerful and effective one. Customers report that they have a more positive image (91%), more trust (87%), and more loyalty (87%) towards businesses that support social and environmental programs. Strategic philanthropy can give you brand recognition with exactly the audiences you want, or even boost the hit rate of social or traditional media stories. Company charitable giving also drives employee satisfaction: “working for a company that gives back to the community” is important to more than two-thirds of the workforce.

Large companies that have resources available for CSR activities typically assign this responsibility to community relations, public relations, a  corporate foundation, human resources, government affairs, or even a dedicated CSR team. They might also involve on-staff attorneys and accountants to help set up and manage corporate foundations, or dedicated teams to help identify and build relationships with important stakeholders.

Privately-held or owner-managed firms typically do not have the extra resources for dedicated CSR staff, and very frequently engage in non-strategic, ad hoc giving. Resource limitations, multi-tasking, and aversion to creating fixed policies all conspire to complicate the giving process, which limits the overall impact of charitable giving.

Valor CSR provides outsourced corporate philanthropy programs, complete with your own branded corporate foundation. Get all of the benefits of a strategic CSR program without wasting resources on the design, management or compliance. Contact us to learn more!

Recognizing that the motivations and resources available for corporate philanthropy will be different depending on firm size, the following process should provide an effective corporate philanthropy program.

How to start a corporate philanthropy program

Step 1: Be clear about the motivation for the program. Larger firms are usually motivated by expectations from stakeholders and the potential business benefits. That motivates smaller firms, too, along with a community focus and the personal philanthropic interests of the owners. Identifying the specific motivation for a charitable giving program makes it easier to justify and maintain. Ad hoc programs are ineffective and don’t usually last long.

Step 2: Determine the available resources. While it is tempting to begin by creating a giving policy, the first step should actually be to create a process for the firm’s philanthropic activities. Decisions about what causes to support and the charitable giving budget all hinge on the available resources, which affects a firm’s ability to respond to requests and engage in other activities. In other words, how much time and money does the firm want to devote to this? If the answer is very little or none, the process that a company develops should reflect that amount of effort. A firm with more resources to devote to these activities, or a greater level of commitment to CSR may generate a more involved or time-consuming process.

Step 3: Identify and rank the business benefits you expect to gain from the program. The typical process usually starts with a list of program ideas: We should donate to charity, or We should do some volunteering. Unfortunately, only after a particular idea is selected does anyone try to determine if there’s some sort of business benefit. Instead, look at it the other way around. First identify the business benefit you want, and then select a CSR program that moves you in that direction. The most common business benefits of CSR are brand building, influencing stakeholders (including employees), and firm differentiation. Check out What are the Business Benefits of CSR or download our free whitepaper for more detail.

Step 4: List the activities that the firm might undertake. For a corporate philanthropy program, these generally fall into four categories:

  • Cash gifts to charity
  • In-kind, skills or capacity donations to charity
  • Internal or external events
  • Volunteering

Step 5: Connect each activity to the motivation, required resources and expected benefits. By explicitly listing out the motivation, resources and benefits for each activity, you should start to see which activities make the most sense for your firm. 

Step 6: Review and repeat. Were the resources and expected benefits on target for each of your firm’s corporate philanthropy activities? Either way, you will gain valuable insight when you repeat the process for the next period. Depending on the resources you make available for a corporate philanthropy program, you can repeat this process monthly, quarterly or annually.

While this process may feel a little bit formal, it will prevent your company from engaging in ad hoc philanthropy (tables at gala events, golf tournaments, or responding to random requests,) which rarely generates business benefits.

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Need help setting up your corporate philanthropy program? We would love to help! Please contact us to schedule a free consultation.


 Further Reading

Why would you want a corporate foundation?
How to set up a corporate foundation
Alternatives to a corporate foundation
What are the business benefits of CSR?
What are corporate philanthropy best practices? (coming soon)
How do you make a corporate philanthropy budget? (coming soon)
How do I manage charity requests?
Examples of corporate philanthropy projects (coming soon)