Philanthropy - The Competitive Advantage
Can corporate philanthropy really give your business a leg up? The short answer is…. YES!
Corporate philanthropy creates employee engagement and generates business value. Businesses create a positive public image, enhance relationships with consumers, and create a positive culture for staff. Having a well-planned and well-executed corporate philanthropy strategy should be part of your overall business plan from the start. This is known as strategic philanthropy and can be an effective way to achieve business goals. Read more about Building Brand Equity Through Social Responsibility (link to blog).
Key benefits of business philanthropy
√ Improve company reputation – giving back is a great way to strengthen your business’ reputation. Customers like knowing the businesses they support, give back to the communities that they serve. 87% of Americans “will purchase a product because a company advocated for an issue they cared about.”
√ Grow revenue – increased brand equity and visibility lead to increased sales. Promoting a good cause, extends your reach and generates interest in your product/service. When choosing between two brands of equal value, 90% of consumers are likely to select a cause-branded product or service.
√ Attract and retain employees – there is a notable shift of employees looking for employers that balance the interest of profit with social responsibility. Programs that directly involve employees help create deeper connections and increase engagement. Increased engagement leads to increased productivity which directly affects the bottom line.
√ Tax benefit – there is a short-term benefit to giving tax deductions. Businesses typically receive tax deductions from charitable giving. You should always consult with a tax professional to ensure compliance with all requirements. Remember, to properly take advantage of any tax benefits, you must accurately track and record your donations.
When successfully executed, corporate philanthropy programs can positively impact business performance. It results in a more productive and engaged workforce, as well as a strong brand reputation thereby increasing sales.
Businesses must tie tactics to a larger corporate philanthropy strategy to improve business performance. Most importantly, value must be demonstrated for the recipient of the philanthropic efforts first; the company benefit is the by-product.