What is Corporate Philanthropy?
Corporate philanthropy refers to the collective efforts made by a corporation, or for-profit organization, to contribute to a nonprofit’s mission.
These contributions could include monetary donations, sponsorships, or in-kind donations. This presents an opportunity for corporations to meet their social responsibility goals; meanwhile, nonprofits can leverage corporate philanthropy as a vehicle for raising funds, spreading awareness about their mission, and engaging new audiences.
This article explores the types of corporate philanthropy that can benefit nonprofit organizations and how nonprofits can go about soliciting donations from corporations.
Types of Corporate Philanthropy
1. Gift Matching Program
One way that corporations can support nonprofit campaigns is by matching the donations made by their employees towards those campaigns. This type of corporate philanthropy is called a Gift Matching or Matching Gift program.
In this case, when an employee donates to a nonprofit, they could ask their employer to contribute the same amount or more, depending on the details of the employer’s gift matching program. For nonprofits, gift-matching programs are an opportunity to scale their fundraising efforts and raise more than they typically would during a campaign.
2. Corporate volunteerism
Corporate volunteerism occurs when corporations encourage employees to contribute time to support a nonprofit’s cause. Some corporations use incentives, such as paid volunteer time off, to allow employees to volunteer with a nonprofit organization during working hours without losing any salary.
Corporations can also show their support for nonprofits by offering volunteer grants. Volunteer grants are monetary contributions made to a nonprofit by a corporation when the corporation’s employee volunteers at the nonprofit. For example, the corporation may donate $50 every 10 hours to each of its employee’s volunteers at a nonprofit organization.
Corporate volunteerism can be incredibly beneficial to nonprofits. Volunteers play a vital role in the nonprofit’s operations but can often be challenging to attract. Having access to a pool of skilled volunteers who have little to lose by volunteering helps nonprofits do more in less time. Similarly, volunteer grants are an opportunity for nonprofits to receive both monetary and labor contributions simultaneously.
3. Corporate Sponsorship
Corporate sponsorship refers to a partnership between a nonprofit and a corporation in which the corporation supports the nonprofit’s services, programs, or events through monetary or in-kind contributions. The nonprofit receives the support it needs to run its programs or events smoothly; meanwhile, the corporation can improve its brand recognition and image in the community.
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4. In-Kind Donations
In-kind donations are non-monetary gifts to nonprofits; these donations usually take the form of a good or service. In some cases, they are even more helpful than monetary contributions. For instance, donating computers, furniture, or free accounting services to a nonprofit organization may be more beneficial than giving the organization money to pay for these goods and services. It will help the nonprofit team save time and focus on moving their operations along.
4 Benefits of Corporate Philanthropy to Nonprofits
1. Secure more funds
Corporate philanthropy offers nonprofit organizations an additional source of fundraising revenue. Whether the corporation donates funds or matches its employees’ contributions, nonprofits can leverage these partnerships to boost their funding.
2. Attract Volunteers
Corporate philanthropy may provide nonprofits with qualified and competent manpower through volunteer grant programs. For many nonprofits, this saves time spent on extensive volunteer recruitment and management programs.
3. Raise awareness about the nonprofit’s mission
Corporations can offer nonprofits the reach and audience they may need to share their story and communicate their impact with more potential donors. More so, a partnership with the right corporation with the right brand image could raise the public profile of the nonprofit.
4. Leverage new networking opportunities
Corporate philanthropy can open the door to a broader network of sponsors and partners for nonprofits. By engaging with corporate donors, nonprofits can gain insights into similar donors and understand how to acquire and build deeper relationships with similar donors.
4 Benefits of Corporate Philanthropy to Corporations
1. Boost Employee Engagement
Employees are more likely to work in companies that actively contribute positively to their communities. Through its corporate philanthropy program, a corporation can empower its employees to participate in and contribute to causes. Doing so will help the team align with the organization’s values and goals. It may also boost employee morale and productivity.
2. Improve Brand Image and Recognition
Consumers are four times more likely to purchase a product from a purpose-driven company. Corporations have an opportunity to elevate their brand image by engaging in corporate philanthropy programs and attracting consumers who care about the nonprofit’s causes.
3. Gain Tax Benefits
One of the most attractive benefits of corporate philanthropy to corporations is the tax benefits they can gain from making contributions and donations to nonprofits. However, corporations must keep accurate records of each gift and contribution to get tax benefits. The nonprofits can help the corporations do this by providing detailed, tax-compliant donation receipts after each contribution, campaign, or fiscal year.
4. Win Consumer Loyalty
Similar to how corporations can engage and retain more employees by contributing to nonprofits and causes in their communities, they can also retain more consumers over time. Consumers will rather align themselves with organizations that impact their communities and factor this when making purchasing decisions.
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5 Steps Nonprofits Can Take to Request Donations from Corporation
1. Start with a company within your community.
A great way to test the waters when collaborating with a corporation is by working with a company in the same city or neighborhood as your nonprofit organization. Ideally, this is a company that serves your community and is knowledgeable about the needs of community members.
When a nonprofit goes into a partnership with a corporation within the same community, the two parties will have similar motivations for collaborating. This helps both organizations remain aligned throughout the campaign. More so, if employees are given volunteer grants, it would be much easier for them to contribute their time to a nonprofit organization in their community.
2. Identify the right contact person at the corporation.
The next step is to determine who is the best person to reach out to at the company. You can do this in many ways, but a good start is LinkedIn. Review the company’s LinkedIn profile to learn more about its team members and possibly find their contact information.
3. Leverage personal relationships
Another good way to source a corporate partnership is by leveraging the contacts. You can ask your board members to introduce you to people in their network or even reach out to specific donors who may have connections with prominent individuals in a company. Don’t be afraid to ask for an introduction; most people are more willing to work with someone with whom they have a mutual connection.
4. Create a partnership pitch
Once you’ve identified the company you want to work with and the contacts to connect with, you should start planning your pitch. Your pitch should include the following:
- Your nonprofit’s mission
- Details about your nonprofit’s upcoming campaign, fundraising targets, and expected outcomes
- The nature of the proposed corporate partnership, e.g., sponsorship, volunteer grants, monetary support, etc.
- How the nonprofit plans to showcase the corporation’s brand throughout the campaign
- What the corporation stands to gain from the partnership.
5. Maintain the relationship
After submitting the pitch, whether or not it is accepted, keep in touch with the organization. And if you eventually get to partner with the organization, make sure you have a concrete plan for managing the relationship beyond the duration of the campaign and partnerships.
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Corporate philanthropy is an opportunity for a nonprofit to garner support from and partner with an established entity that serves its community and can extend its reach. There are unique benefits that corporate philanthropy offers both corporations and nonprofits, and as such, it is definitely worth exploring.
Additional Resources on Corporate Philanthropy
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