The Role of Leadership in Corporate Philanthropy Efforts

As the saying goes, everything rises and falls on leadership. As seen in several studies, the philanthropic nature of a business owner significantly impacts a company’s culture. For leaders who tend to have a more Ebenezer Scrooge approach to generosity, negativity, high turnover, and low morale often create the bulk of a company’s culture. For those who have the pleasure of working with or for a noted philanthropist like Golden Warriors owner Mark Stevens, sense of pride, connection to the world, and job satisfaction tend to run deep.

The Ups and Downs of Corporate Giving

After the recession of 2008, corporate giving noticed a sharp decline. Many companies were trying to stay afloat and turn a profit in a bleak and stalled economy. Higher than normal unemployment rates took a toll on charitable organizations across the country. Resources were spread thin, and corporate philanthropic efforts had slowed to a trickle. As national disasters have hit over the last few years, corporate giving is on its way back up. In 2017, overall giving had an 8% increase from 2016, totally around $20.77 billion dollars. The jump in giving was encouraged by over $405 million in donated funds to help with disaster relief efforts.

The Culture of Corporate Giving

There is a difference between the giving efforts of high profile businessman and a corporate giving program. A single individual has the power to control personal wealth and distribute it according to personal interest, while a corporate network has several individuals that get to make the financial decisions. However, when those at the decision-making level of a corporation decide to invest in philanthropic efforts, statistics reveal that an overall culture of giving is widely adopted by employees at various levels throughout an organization. Throughout the last few years, 79% of companies reported an increase in the participation rates of their employee donors, with 73% of organizations raising more money than in prior years. This giving mindset would be expected in nonprofit organizations, as more than 49% of nonprofit organizations indicate workplace giving as one of the hallmark areas in their growth strategies. For other companies, being able to partner with a nonprofit brand that is widely recognized and known having a local community impact is a move that can enhance their brand and increase their company’s impact on the community.  

However, small nonprofits with a limited number of staff or with fewer resources to work with often have difficulty developing strong partnerships with corporate entities, despite the local impact such as relationship could have. On the corporate end, the pull to fulfill the organization’s social responsibility is often countered by a need to continually pull in new profits. As such, many of the choices for partnerships lean heavily toward to the entities that can provide favoriting public relations exposure or good marketing opportunities. The giving mindset, only to potentially return company growth, can seem disingenuous to those who are receiving on the end of corporate gifts and those who work for a company intent on charitable giving. As an alternative, volunteer efforts are becoming more popular.

The Volunteer Mindset

While some companies will donate corporately or have owners making donations on behalf of the company, the millennial mindset wants personal ownership in philanthropic efforts and taking care of the human family. Matching gift programs have been one of the easier ways for everyone in a company to get involved in giving. Around $3 billion each year of corporate donations is accumulated through matching gift programs. On average, 12% of total cash contributions from large corporations comes from matching employee donations. There is a slight downside to this method, as between $6-$10 billion in matching gift funds are left unclaimed each year.

Rather than simply giving many, the younger generations prefer to donate their time to help out humanity. Currently, about 60% of companies across the country offer employee paid time off for volunteer efforts. As more millennials and Gen Zers dominate the workplace, these companies are looking to expand their time off allowances to include release time over the next few years. The national average on employees who volunteer is about 30%, and these employees report that they feel better physically, mentally, and emotionally because of their volunteer efforts. The move toward skills-based volunteerism is growing, with mentoring, clinics, workshops, and camps proving opportunity one-on-one opportunities for interaction that rely on the skillset and talents of the employee volunteer. When business skills and expertise are contributed to nonprofit efforts, the employee is able to experience personal growth in areas of leadership and professional skills.

The Way to Get Involved

Around 86% of employees expect their company to provide opportunities that will allow them to engage in their community, and an equal number of employees want to work for an individual or company that supports causes and issues that an employee values. In order to maximize employee involvement in philanthropic or charitable efforts, have a leadership team that sets an example by making the first move to help others.