A CEO and a Non-Profit Fundraiser Step into an Elevator…The Importance of Developing the Right Corporate Giving Strategy

 

Most companies, large and small, understand the importance of being able to describe their unique business model to potential customers and employees in a few words — the classic elevator pitch. From the boardroom to the shop floor, it is important that everyone has the same concise understanding of the company’s strategy and objectives. Such alignment ensures everyone is working towards the same goals, making decisions that are internally consistent, and representing the company accurately to customers, suppliers, recruits and the community. And yet, many companies are not able to provide a similarly consistent description of their corporate giving strategy. In fact, many do not have a giving strategy, concise or otherwise. 

The lack of a cohesive corporate giving strategy is rarely an intentional oversight. Often, corporate giving programs have simply evolved in the background without much strategic direction. A company’s giving may reflect the owner or CEO’s interests, personal connections, or simply be the result of “that’s who we’ve always supported” justifications. None of these drivers are inherently bad, but they need to operate within, and be bound by, a larger strategic plan in order for company contributions to be most effectively allocated.

Successful companies and their leaders will attract requests for support from a wide range of non-profit organizations representing the full range of program areas, from arts and culture to health and human services, to education and the environment. Most of these organizations do very good work in the community. Without a clear, concise, easily communicated strategy, how are these requests to be evaluated? If the argument to support an organization is not based on a sound strategy, it is probably being justified using factors like the reputation of the charity, the person making the request or a historic relationship that would be awkward to challenge. Again, these can all be considered, but only to the extent the contribution fits within the company’s stated strategy. 

A good corporate giving strategy will specify the particular program areas the company supports, such as elementary education, environmental conservation or arts in the community. The shorter and more specific the list, the better. Ideally, there should be a clear link between the targeted program areas and the company. For example, companies who rely on technically skilled employees may focus on science and math education in their communities. Or they may focus on a critical need in the community that the company can help address through its support and by raising awareness. In selecting the areas of focus, companies should consider all stakeholders, including employees, customers and investors. 

Guided by a clear giving strategy, support decisions become less personal and less subjective. Requests that fall outside the company’s giving strategy can be declined based on that lack of fit, with no implication that the cause is not worthy or important enough to support. More importantly, over time it becomes easier to demonstrate and report real progress as the company’s philanthropy stays focused on its giving strategy. Companies expect their business investments to succeed and they develop strategies to ensure the right outcome. There is no reason to expect less from corporate giving.