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Corporate donations: Giving to the right charities


You want to give back to the community, but where do you start and how do you know your money’s going to the right place?

When you attach your name, time and money to a charity, you want to know it will be a good steward. After all, it’s your reputation on the line, too, if the charity organization turns out to be unscrupulous.

How can your company minimize the likelihood of allying with a charity that is not ethical, or one that doesn’t align with your organization’s core values?

Here are eight steps you can take to protect your personal and corporate reputation when making a corporate charity donation:

1. Consider your company’s values

The first step in deciding whether to support a charitable cause lies in understanding your company’s core values. What is it you want to support and why? How can you, your company and its employees move the needle in making a real difference by focusing on your values?

There are essentially two kinds of philanthropy for businesses: general and strategic.

Strategic philanthropy aligns your corporate donations with nonprofits related to your business and industry. For example, if you own a restaurant, a strategic alliance would be with a nonprofit that addresses hunger or childhood obesity.

By nature of what your business does, you can effect real change in these areas just by getting involved.

General philanthropy addresses your community’s needs. What are the issues facing your neighbors; what corporate donations do your employees support?

For example, after-school child care may be a big need in your community, so you could give a grant to the YMCA to sponsor children in their program.

2. Consider the charity’s values

Once you have your company’s values, you should evaluate the core mission of the charity.

There are a lot of corporate charities to donate to; finding one that shares your views and values will make the relationship more meaningful for both of you. You may not hit on all topics, but using a checklist of values can help you narrow the field.

3. Ask questions

This is a common mistake that many companies make because it takes time – and sometimes you don’t have a minute to spare. Vetting a corporate charity should be as important to you as choosing a vendor or business partner.

Talk to others in your industry and community. Find out which charities they support and why. Ask if they’ve ever had problems making corporate donations to the charity you’re considering.

At the very least, talk to the executive director of a charity you’re considering. You can also talk to board members and ask to attend a board meeting. You’ll get a front row view of how they do business.

4. Do your homework

It is important to properly research any group you’re interested in supporting through your community involvement program.

There are charity watchdog organizations such as GuideStar and Charity Navigator that analyze and rate nonprofit organizations. They assess a charity’s financial health, accountability, transparency and governance. These ratings can help you determine which charitable corporate donations are best for you.

Don’t spread yourself too thin – be particular about the corporate charity programs you get involved with.

5. Meet the press

Look at how your corporate charity is presented in the news. Is it constantly being raked over the coals? Remember, people like to gripe about what went wrong, so an instance of bad press may not be the whole story. There are no perfect charities – mistakes will be made.

Part of doing your homework is finding out how the charity recovers after something bad happens. Who are the people making decisions, how are they fixing it and did they learn from it?

6. Assess their strategy

Your charity of choice should have a strategic business plan, preferably three to five years out. Does the plan align with its core values? Does it align with your company’s values?

A strategic plan tells you a charity is organized. Without it, they typically are focused on day-to-day activities, and may have a hard time growing.

Donors and businesses like to see a long-term plan that lays out how the charitable organization plans to change the landscape of a community over the next several years.

7. Solicit feedback from partners and employees

Check in with your business partners and get their take on your philanthropic plans. Is there anything they don’t want you to get involved in? What is their reasoning?

What are your employees interested in? If you support what they’re passionate about, they will a have stronger allegiance to you as a business owner. Volunteerism is important to many employees and they’ll appreciate your encouraging their input.

8. Communicate your strategy

Consider having someone in your company keep a running list of corporate charity programs your employees support, as well as the top causes your firm wants to associate with.

Be proactive and intentional about setting a philanthropy budget. How much will you donate over the course of a year in cash and in-kind donations?

One option is to use part of your budget to reward employees who volunteer by donating to their favorite charities. For example, a corporate charity that receives 50 hours of volunteer time from one of your employees receives a $500 check from you.

Although it’s tempting, you can’t say “yes” to every school fundraiser. Help manage the requests by putting your philanthropy strategy and guidelines on your website so others will know your charitable initiatives and how to make donation requests.

Having a corporate social responsibility program can be good for your community and your employees. People want to work for companies that care. If you’re looking for more ways to keep your employees engaged, read this guide on How to recruit and retain top talent.