Embracing corporate responsibility can give your business a competitive edge in your industry, especially in the current age of social media where you are expected to be on your best behavior at all times. Besides making the world a better place and reinvesting into the community, the long-term prospects of corporate giving are much like a positive feedback loop – the money and effort you spend in charity will eventually make its way to you.
Companies with successful philanthropic programs often receive significant advantages, not just for their brands, but also for their bottom line. It is a well-known fact that customers in 2021, more specifically millennials, prefer to buy a product from a company when it supports a nonprofit organization in Hawaii they care about. So how does corporate giving improve your bottom line?
Here are just a few benefits of corporate giving you should know.
Tax Deductions
Tax deductions are the most immediate benefit of making a charitable donation. Most donations are tax-deductible and you can get deductions of up to 50 percent on your income. Just make sure to consult a corporate tax lawyer to avoid breaking any rules. You can write off various expenses from your taxes by itemizing your deductions. The only caveat is that you’ll need to work with an IRS-approved nonprofit organization. To claim your tax deduction, the charity will issue a tax form that you can file on your tax return.
Taxes have always been a complicated endeavor, so you should talk to your accountant or corporate lawyer for advice on how to maximize your tax deductions and reduce your tax bill.
Free Publicity and Brand Awareness
A cursory look at some of the most successful businesses of today will reveal their strategy: building relationships. This is one area where corporate giving can play a major role. By supporting your community, you are becoming a force for good and it has an immediate impact on brand awareness and reputation. As a rule, the more charitable you are, the better your business will do. You can also reconnect with your audience with the help of your positive social initiatives.
Many small businesses participate in charitable causes by allocating a certain percentage of their sales to charities that they support. When their customers, vendors, and partners see the charitable impact of supporting the business, they will be more likely to engage with the company instead of other big brands that don’t have that human connection.
It’s a mutually beneficial relationship because of the goodwill that your company generates while supporting a worthy cause. If your current budget isn’t adequate to host a charitable event, you can also engage in marketing and community outreach by asking your employees to volunteer as a team.
Pro tip: Sponsor a good cause or nonprofit. This way, you’ll often see your company branding throughout the event, and your company will get some free publicity with attendees. As a result, your brand will reach a wider audience that you might not reach through conventional advertisement campaigns.
Employee Engagement
Philanthropy can also do wonders for employee engagement. Why does this matter? A study by Gallup found that businesses with engaged employees outperformed their rivals. Engaged employees tend to be happier, stay with the company for the long haul, and care about charitable causes.
When companies provide their employees an opportunity to get involved in a philanthropic endeavor, it boosts their engagement levels. To make this work, the senior leadership should provide a clear vision to their employees so that they can work towards a common goal. Moreover, employees should be asked for their input on how the company can better serve the community.
Some of the most common ways of boosting employee engagement include:
Matching Gift Programs: Not only are you donating part of your bottom line to a better cause, but your employees also get to take part in the act. To make this endeavor more effective, you can ask your employee to choose any Hawaii non-profit they care about. As a result, employees can feel proud knowing they have the full support of their employer
Encourage Volunteer Work: The company can offer paid time off so that employees can volunteer and participate in worthy causes, fundraising events, and other charitable causes. This can significantly skyrocket employee engagement because it allows employees to rally together and benefit their community on the company dime (and time).
Increase Sales
Giving back to the community will allow your company to build stronger relationships with its stakeholders. This allows them to extend their support to charitable causes – even if they’re doing it indirectly. For best results, we recommend doing some market research to identify popular charitable causes in your local area.
A good rule of thumb is to survey your customers and learn about the cause they care about. Charitable donations of this type tend to be more successful because they resonate with the local community. It also demonstrates that you truly do care about your community, and by extension, your customers.
Giving Back is Good for the Company
Besides the tax cuts and free publicity, perhaps the biggest benefit you get from donating to a charity is the personal satisfaction you derive from giving back to the community. As a business owner, you are in a unique position to make a difference in your community and make the world a better place – not just through great service or products, but by actively supporting charitable organizations.
A strengthened community is good for your business in the long run because it will create a positive feedback loop.
Wrapping Up
Hopefully, you’ve been able to understand the real benefits of corporate giving.
You can brainstorm ideas for corporate giving that align with your culture and company mission. Once you have locked these ideas down, focus on the key metrics of success and make data-driven decisions to make a greater impact.
If you do it right, corporate giving can help retain employees, keep them engaged, and build a more purpose-driven workplace culture. So, call in a company meeting today and ask your employees about their interests, charitable causes they care about, and about your plans to join charitable companies.
