Four Rules For Corporate Giving In 2019
The holidays are over and Americans outdid themselves when it comes to corporate giving, donations, and more.
Retail sales rose 5.1 percent from 2017 for the period between Nov. 1 and Dec. 25 – marking a six-year high – as total sales topped $850 billion, according to Mastercard SpendingPulse, which tracked retail spending. Strong economic growth in the United States pushed consumers outside and online to put more in their shopping carts.
Another exciting holiday metric should rise too – charitable giving.
In 2017 buoyed by a strong economy and rising consumer confidence, charitable giving from individuals, foundations, and corporations reached $410 billion, crossing the $400 billion mark for the first time, according to the 2018 Giving USA report.
This year should be no different. Corporate giving makes up a sizeable portion of charitable giving in the United States and it is on the rise. Amid record profits, companies should continue to give in record numbers. The Beehive State’s tech community – increasingly built by millennials with a proclivity for giving and work with a community impact – should only bolster the culture that made Utah the most charitable state in the nation in 2017, an accolade from a study by WalletHub.
Juniper Systems in 2018 gave the largest single donation in the company’s history to Utah-based non-profit Choice Humanitarian, which builds up leaders and communities with training and assets to sustain growth and opportunity long term in poverty-ridden regions of the world.
It’s core to Juniper Systems to give back to the local community and worldwide community. Juniper Systems founder Ron Campbell built it into the company’s DNA when he founded it in 1993. But beyond the instinctive importance of philanthropy, corporate giving provides measurable benefits to a company.
- 86 percent of Americans expect companies to address social and environmental issues
- 87 percent of Americans said they’d buy from a company that advocated for which they care about
With the holiday season in the rearview mirror, Juniper Systems reached out to an expert on nonprofit giving to learn what Utah’s booming business community needs to know about giving in 2019.
Since 2016, Kate Rubalcava has been CEO of the Utah Nonprofit Association, which works “to unify, strengthen and elevate Utah’s nonprofits.” Utah boasts 8,214 501(c)(3) organizations, according to Rubalcava. This tax status is set aside for public charities, which include charities, churches and private foundations. Each nonprofit has unique needs, but here are four basic rules the business community – and individual donors – can follow to better serve them.
1. Align through research
You should really know your company and the nonprofit before donating, Ms. Rubalcava said.
“Look for alignment,” Ms. Rubalcava said. “We should give to organizations that serve a purpose and make us feel good about the work they’re doing. People need to know that if they feel comfortable with their gift, whatever it is, that is the best gift they can make.”
A good fit can make a big difference. Corporate giving is associated with greater employee retention and more enthusiastic employees.
Ms. Rubalcava said that in a company’s research, it should dig into what the nonprofit does, their mission and how they serve that mission. In addition, it should ask for employee feedback and choose an organization that rallies the support of the company.
“Don’t give to a nonprofit that doesn’t align with you,” she said. “Do the research and make sure your values align with the mission of the organization. If they do, that’s a good match.”
2. Understand the realities of nonprofit work
Nonprofits have costs, too.
Ms. Rubalcava said this message is sometimes hard for donors to swallow, but it should not cause discomfort.
“Give if you believe in the organization – not because you want them to do what you want with the $200,” she said. “Donate to an organization to do all the things they need to do.”
“Nonprofits have bills and salaries to pay so that they can do the good work they are doing. We have hard costs and have to fund those someway,” she added.
Ms. Rubalcava said scandals that surround high executive salaries at nonprofits usually involve big-money nonprofits. Those controversies ignore the realities that local nonprofits face – 99 percent of nonprofits in Utah handle budgets less than $500,000, according to Rubalcava.
Messaging from some nonprofits that promises 100 percent of each donation will go directly to their cause hurt the nonprofit community, Ms. Rubalcava said. When donors say “they don’t want to pay for salaries, rent, or health insurance, it makes it impossible for hygiene kits to be created or food to be distributed.”
While questions about money allocation are appropriate, she said, expecting a donation not to cover administrative costs hinders the organization.
“Nonprofit work is made up of dedicated professionals and they deserve salaries and benefits, too.”
3. Build a relationship
Like in business, a strong relationship creates a better result.
“The first place to start is with the relationship,” Ms. Rubalcava said. “Develop it. Ask about needs and desires, what a partnership could look like, make a commitment and see it through.”
More than 80 percent of nonprofits struggle to build strong corporate partnerships, citing limited staff and resources, according to a 2014 study. Close communication and honest conversations, Ms. Rubalcava said, allow for better outcomes and nontraditional giving opportunities that support the nonprofit and better involve company employees.
Nontraditional giving opportunities could include providing a space to rent, equipment, volunteer time, and expert leadership.
Ms. Rubalcava said finding ways to involve employees takes communication and creativity, but it leads to strong outcomes in the partnership. “Employees could do drives around the community – clothing, food, shoes, and musical instruments. They could support professional volunteerism by serving on boards and being an advocate for that nonprofit.”
“Have those conversations,” she added.
4. Remain consistent and timely
The economic system in the United States has three major levers: business, government and the nonprofit sector.
That’s how Ms. Rubalcava sees it.
“In order to have a healthy economy, they need to be operating at the same efficiency,” Ms. Rubalcava said. “When you’re considering a charitable donation, that donation is going to impact the other two levers. No gift is too small, but planning it out and making it part of your everyday motion is the best way to support nonprofits.”
A 2014 study found that 31 percent of annual giving landed in December and 12 percent came within the last three days of the year.
“Nonprofit is a tax designation, not a business strategy,” she added. “Remain consistent in your giving and give to build a relationship.”
Ms. Rubalcava recommended businesses plan out their yearly giving and share the plan with each nonprofit. “Nonprofits are all running a business with P&L statements, budgets and projected costs,” she added.
Foresight in operating for a nonprofit makes a huge difference, according to Ms. Rubalcava and can change how you donate in the future.