Six Lessons on Strategic Philanthropy to Advance Your Company’s Reputation
Chances are if your company made it onto Fortune magazine’s list of “World’s Most Admired Companies” for 2019, strategic philanthropy is hard-wired into your DNA. The prestigious survey uses nine criteria to select the best-regarded businesses, including corporate social responsibility (CSR).
Companies embracing CSR—the belief we all have social, environmental and ethical responsibilities to society—are reaping the benefits of their activities in important ways. First, they are establishing goodwill with employees, customers and other community members. That’s earned trust you can bank on. Even better, they are increasing profits and building strong brands.
Starbuck’s, which ranks fifth on this year’s Fortune list, is a champion in leveraging its scale for good. To be sure, the Starbuck’s brand is synonymous with sustainability. From sourcing responsibly produced products to green retailing, Starbuck’s makes being environmentally friendly central to its brand.
Now Starbuck’s is embarking on an even larger social impact agenda, opening stores in underserved communities like Ferguson, Mo. , where food insecurity and homelessness are common struggles. Starbuck’s Community Store model partners with change-making nonprofits to provide skills training and bring jobs to the neighborhoods it serves. Next, store profits are reinvested through innovative services and programs.
With more than 17,000 stores worldwide, clearly Starbuck’s business approach is working. It’s earnings, revenues and stock price are the envy of many Fortune 500 companies. So what puts the buzz in Starbuck’s highly-caffeinated growth strategy? The brand’s likability is attributed to visionary leadership and a social responsibility record that is second to none.
Tapping into Social Impact
It’s possible to think social impact can only be achieved by the big brands. Yet, that’s not the whole story.
All social impact is local. Even small companies can apply these lessons to make a positive difference in their own communities:
Lesson 1: Find your purpose in your values.
What will your company be known for? Company values typically describe the core beliefs that define why you do what you do. They become guiding principles and passionate touchstones for business conduct and customer care.
In the age of social impact, companies today are expected to do much more. Make sure your values go beyond customer service to reflect what your business stands for and how you are working to make a difference.
Lesson 2: Align your purpose with your brand promise.
Every brand makes a promise. To some extent, it is a description of your company’s character.
Your brand promise impacts every business decision you make. Therefore, the causes you support should be well aligned with your business and the work you do. As a result, your philanthropy becomes an extension of the value you bring to the marketplace.
Lesson 3: Make collaboration the cornerstone of your giving strategy.
Too often, companies begin and end their corporate giving with event sponsorships, check donations and similar community relations activities. These efforts by generous businesses help sustain small charities and contribute to the nonprofit sector as a whole.
Still, while social impact is the reason nonprofits exist, it is often difficult to measure on any scale the affect of their work. Stakeholders today—millennials in particular—are taking a much closer look at organizations’ charitable programs. They want to move the needle far beyond “good deeds” and “citizenship” with expectations of real-world change.
What should businesses do in this performance-driven environment?
Visionary business leaders can encourage more cross-sector collaboration by developing innovative giving models and programs designed to maximize results. Such an approach reduces competition between similar charities and delivers better value for taxpayers and communities.
Lesson 4: Cultivate a culture of volunteerism.
Volunteering is an integral part of employee development practices at many companies. That’s good news since today there are more opportunities to volunteer than ever before.
Volunteers power community fundraising events. They also are extensions of the paid nonprofit workforce, providing essential services. Without them, most nonprofits wouldn’t exist.
According to the Corporation for National Community Service, about 25 percent or 62.8 million of Americans volunteer, many through corporate-sponsored programs. Since it’s not always possible for small companies to give paid volunteer days off, consider other incentives. Think creatively about how to support the causes your employees care most about. Build short-term rewards into long-term programs.
Lesson 5: Drive engagement with meaningful communication.
The backbone of your strategic philanthropy program should include policies, guidelines, goals and identify metrics for measuring success. Nothing complicated, a framework that lays a foundation for all you seek to accomplish.
Be sure to motivate and engage stakeholders through sustained communications using social media, your company intranet, external newsletters and the press. Make top leaders the highly visible champions for the causes you support. Earn your bragging rights; give with humility.
Lesson 6: Learn from all that you do.
There will be successes and failures when embarking down the strategic philanthropy path. But a commitment to clear goals, innovative approaches and measurable results is more likely to achieve social progress, experts say.
Learn from mistakes and make adjustments to your strategy along the way. Choose your charitable partners wisely. Replicate what works.
Commit to More
Businesses are under increased pressure from stakeholders to make social impact part of their brand and business strategies.
In particular, employees are looking to their employers to lead change rather than waiting on the government to require it, according to the 2019 Edelman Trust Barometer, a global survey on trust in institutions. Employees now expect prospective employers to actively join them in advocating for social issues (67 percent of survey respondents). Companies that do are rewarded with greater commitment (83 percent), advocacy (78 percent) and loyalty (74 percent) from their employees.
Because of changing political and economic pressures, the time has come for all organizations to do more with their philanthropic programs. So, where to begin? Start by putting your community into sharper focus.
The views expressed here are mine and mine alone. They do not necessarily reflect the opinions of my current or former employers, my friends and colleagues, anyone I may have met in the past or may meet in the future.