The Benefits of Strategic Philanthropy

By Dimitra Tasiouras

For small businesses and companies with limited resources, it's the truly creative, out-of-the-box solutions that succeed—from product development to advertising, to employee retention programs. The same is true of corporate giving. Instead of scribbling a few checks each year, be creative. Align your charitable giving with your corporate vision to get the most out of your philanthropic efforts.

This type of giving—commonly known as strategic philanthropy—helps the community and enhances your company's reputation with your customers. Strategic philanthropy isn't about disguising self-serving activities under a veil of good intentions or adopting a cause merely to sell products. It's about showing consumers that your company cares about its community.

Studies show that today, more than ever, consumers notice a company's social conscience. In fact, consumers indicate that when all else is equal, they prefer to buy from a company that's associated with a good cause. It's not difficult to leverage your charitable activities to benefit your community, your employees, and your businesses.

5 ways to get started with strategic philanthropy

Here are 5 tips:

1. Think small

Investigate organizations in your community where smaller donations and limited resources can have a big impact. Or support a new project or nonprofit group. You'll generate interest in a lesser-known cause and see firsthand how your efforts make a difference.

2. Do what you know

Your contributions should be a logical extension of your business. Think about how you can leverage your products, services, and areas of expertise. Then align your company with an organization that complements your product. For example, if you sell food products, support an anti-hunger program; if you provide personnel services, work with a local job-training program for the poor.

Helping a nonprofit group develop personnel policies or marketing materials may not sound as heroic as building houses, but if it's what the group needs, providing it with your services pro bono will be an enormous help.

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3. Lead by example

Setting up a charitable program demonstrates to your employees that your company doesn't exist solely to make a buck. It shows them that you're willing to invest in the community where they live, which may motivate them to participate.

4. Create a partnership

Your relationship with nonprofit organizations should be a partnership of equals. In many cases, the organization will benefit more by developing a partnership with you than by receiving a one-time cash donation. And you'll probably find that it's more rewarding to participate in social change as well as fund it.

5. Spread the word

Most nonprofits have limited publicity resources, so take the initiative to promote your charitable activities. Devote space on your website for a little PR about your partnership, or call the local newspaper and pitch the story as a community-interest piece. The people in your community should know how you and the organization are working to improve the community.

About the Author:

Dimitra Tasiouras is program officer of the Lloyd A. Fry Foundation, a private foundation that supports organizations that address persistent problems in urban Chicago caused by poverty, violence, ignorance, and despair. She has more than nine years of experience in philanthropy and nonprofit management.