Danny Games: 7 Goals of Corporate Charitable Giving

Editor’s note: The author of this guest commentary, Danny Games, has served in governmental & public affairs and economic development roles that include corporate giving at three Fortune 500 energy companies.

Mark Twain said, “Do the right thing. It will gratify some people and astonish the rest.”

“Doing the right thing” is an often-invoked objective or rationale for decision-makers weighing corporate charitable contributions, but in the end, “the right thing” remains an elusive and subjective aim and can generate more questions than answers. Though not comprehensive, the following seven goals and challenges can be useful in helping decision-makers agree on the front-end as to why they may support a particular cause and eliminate some of the guesswork and tedious deliberations in making good investments.

Retail – One of the biggest reasons most companies exercise charitable giving is for retail exposure among customers – self-serving, but not without significant mutual benefits. Often times incorporated into an overall advertising strategy, corporate giving that seeks to increase visibility among a target audience(s) can be very effective if would-be customers are appreciative of or influenced by such financial support. The challenge is: what are the marquee opportunities that will gain you exposure and how best to maximize your visibility and presence?

Branding – Companies can gain significant “branding association” upside by supporting charities and causes where they gain mutual branding benefits generated by the recipient organization. Certain organizations and causes have been very effective at branding their logo and cause, even generating products and sales revenue of their own. Supporting these causes for co-branding benefits provides opportunities among valued customers and constituencies. The challenge is determining what reputable cause or organization best aligns with your company and products and can craft the right fit for your company.

Personal & Historical – Many companies, particularly those operating in smaller communities, have been the anchors of community giving for many years. They support little leagues, festivals, and local schools. Community events and causes often have a lot of personal stock, including employee and managerial involvement, and can build appreciation over a long period that engenders much internal and external goodwill. The challenge is determining in which community event or cause your company and employees should invest, and whether it should come in the form of financial support and/or employee volunteerism.

Compelling Community Need – A growing social conscience movement within corporations is the realization that governments and non-profits cannot solve all societal problems and there is an increasing role for business leadership. Some causes are more politically sensitive or seemingly insurmountable, but committing to these causes with significant financial support and conviction for a long time – with expectations of measurable results – may help achieve that sense of “doing the right thing” if executed effectively. The challenge is knowing the major socio-economic indicator that may sink your community and adversely affect your talent pool or customer base and will require time, money, and partnerships to address…for a long time.

Promote Political or Religious Interests – Calculating risks is important when funding causes that are overtly political or religious, but based on a company’s ownership structure, decision-making hierarchy, and one’s personal convictions, the decision to wade in can be more satisfying among principle-driven leaders. Furthermore, if a company’s target audience is likely to agree, then product and brand loyalty can be derived if the reputational interests of the beneficiary organization and company are well managed. The challenge is identifying what warrants support in political or religious realms to affect real change, and determining if you have the fortitude to be criticized for stepping up and out.

Aligns with Long-Term Business Interests – Companies that have key customers who support the Heart Association should seriously consider being big supporters of the Heart Association. Personal relationships and a long-term view of your customers’, regulators’, and stakeholders’ interests can help shape where you need to be…or, not need to be. Companies that write more selective but larger checks to a smaller number of organizations appear to be taking this view. The challenge is: what are the natural fits for your customers, business and product(s) that make for obvious win-win places to be in the charitable picture?

Legacy – A very long-term view can often materialize into something more than branding, namely, establishing a legacy that will live beyond the founder or current CEO. Many philanthropic causes have seized upon this inclination among companies and are tailoring legacy nameplate opportunities whereby a company may be known for generations. Unfortunately, some companies create legacies for the wrong reasons, but proactively carving out your company’s name and its leadership’s place in the history books is a worthwhile consideration. The challenge lies in filling in the blank: twenty-five years from now, your children will be able to say – blank – about your leadership and your company.

A recent informal survey among energy industry sector peers included several other goals for directing corporate giving – some of which are derivatives of the seven – including employee recruitment, reputational, imaging, maintaining license to operate, tax benefits, and even “it depends on who is asking.” These are related compelling and influential factors that may also factor into your considerations.

There are numerous variables and complicating factors in helping answer all of these questions, but at the very least, it will be more productive and deliver a greater sense of satisfaction if goals such as these are determined at the outset. Well-defined goals and results will be more gratifying, and, maybe even astonishing.