How to Use Philanthropy to Improve Company Culture


Over the past few years, companies have been expected to take on greater social responsibilities and conduct business with a conscience. Driven by employees, customers, and shareholders, a company’s reputation—and indeed its bottom line—can be heavily influenced by its philanthropic efforts.

Consumers are increasingly leaning toward patronizing businesses that support charitable causes. Studies have shown that 84 percent of Americans believe it’s important for a business to be engaged in philanthropy, while around 50 percent said they would switch brands or services to a company supporting a cause they believe in.

While corporate philanthropy can lead to increased profits, its purpose and impact are farther reaching than that. Employees, particularly millennials and the younger generation, expect the companies they work for to offer community projects. In fact, up to 78 percent of millennial employees say they would engage in charitable work if offered by their companies.

Additionally, companies that support important causes can make a difference in the lives and circumstances of others to a far greater degree than individual support can.

Company Benefits of Corporate Philanthropy

Improves Team Bonding: Social initiatives, in which people are directly involved in supporting a cause, are just as important as financial donations. Initiatives that encourage employees to work together on projects away from office duties have proven to strengthen team bonding and lead to an improved company culture. Employees who experience first-hand the difference their contribution makes realize feelings of personal fulfillment and accountability and gain a sense of playing an important role in the community. When these feelings are experienced as a collective, it can have a powerful effect on the company as a whole.

Creates Feelings of Happiness: Of central importance to any good company is employee happiness and satisfaction. Unhappiness among workers affects productivity and leads to higher turnover rates. A growing body of research shows that giving back leads to increased levels of happiness, so building a company culture around community projects and volunteering programs is a wise move for businesses looking to provide greater fulfillment for their staff while also benefiting charitable causes.

Attracts the Best Talent: As mentioned, employees are increasingly demanding that companies balance business efforts with philanthropic commitments. A Deloitte study found that millennial employees are “twice as likely to rate their corporate culture as very positive” if their company is involved in volunteer and outreach programs, while additional research has shown that around half of these employees would not work for a company that did not have a strong corporate social responsibility strategy. By engaging in charitable causes, companies can position themselves to attract and retain top talent, who place just as much importance on philanthropy as business performance.

Increases Company Reputation and Brand: Engaging in charitable causes will only improve a company’s reputation among its employees, consumers, partners, and the wider community. There is also the benefit that by spending more time out in the community, businesses can maximize opportunities for brand awareness, thereby combining marketing with social initiatives. A more positive reputation and brand will invariably boost a business’ bottom line.

Enjoys Tax Deductions: While this shouldn’t be the primary motivating factor in corporate philanthropy, companies can enjoy some tax breaks through charitable activities.

Ways to Implement Corporate Philanthropy

Partner with a Charity: Companies can demonstrate their commitment to corporate philanthropy by partnering with a charitable organization. Businesses sometimes choose to work with a charity that reflects their company ethos or support a nonprofit that focuses on the local community. Such partnerships can involve a variety of philanthropic efforts, including financial donations (through fundraisers, donations, and pledging a percentage of company profits), providing free business services, and arranging volunteer programs for staff.

Set Financial Targets: Creating targets always makes achieving goals more likely. The same applies if a business decides to make a financial donation to one or more charitable causes. Pledging to donate a certain amount by a set date encourages staff to create effective fundraising initiatives, motivates team members to hit targets (if a company has pledged a percentage of profits), and holds the company collectively accountable.

Leverage Your Company’s Skills and Services: While all nonprofits need financial assistance, companies can also volunteer the skills and services they already have at their disposal. For example, PR and marketing firms can create campaigns, law firms can offer pro bono legal assistance, web design agencies can build websites, and project management companies can organize events. Companies should look at the services and skills they already offer and see how they can be used for a charitable cause.

Offer Volunteer Days Off: Often referred to as VTO (volunteer time off), this is a great way for businesses to show they are committed to philanthropy by removing the expectation that volunteering should only be conducted outside of office hours.

Establish Volunteering Programs: Even if a company decides not to partner with a charity, there are many volunteer programs they can be a part of. Many nonprofits have corporate programs already set up that include team-based volunteering.

Cover Staff Donations: This can be done by setting aside an amount for each employee that is used to dedicate to a charity of his or her choice. Decide on a set annual amount for each staff member and invite each person to discuss why their charity of choice is important to them. Covering staff donations empowers individuals to lead the action for a cause close to them. It also helps strengthen company culture by showing employees that their company supports the issues they are passionate about.

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