Corporate philanthropy is often considered a key activity for businesses to showcase their social responsibility, support local communities and make good use of their societal impact.

Philanthropy is a powerful tool, allowing businesses to open a meaningful dialogue about their social values with stakeholders and instil positive change. But what is corporate philanthropy? And why should you implement it into your business model?

Philanthropy deep-dive

The term ‘corporate philanthropy’ is used to describe the activities businesses voluntarily undertake to manage their impact on society. These are usually for the benefit of local community organisations, charities or non-profit organisations and can include things such as donations of products or services, monetary investments and employee volunteering programmes.

Philanthropy is about identifying the causes of social problems and providing the tools to help fix them. When used effectively, it can not only deliver transformational change, but also influence society’s behaviour. It is therefore crucial that businesses consider how they can best use their resources to address the needs of the people they want to help.

What are the benefits?

Perhaps the most obvious and important benefit of corporate philanthropy is the difference a business can make to those in need. By giving back to society, whether through time or money, businesses can have a real positive impact by supporting charitable organisations working hard to improve people’s lives.

What’s more, businesses often choose to support organisations which are close to the hearts of its employees. By doing this, businesses can create a more positive and engaging workplace environment, where employees feel valued and proud to be part of a business that is making a real difference to wider society.

Aside from the social benefits, there are also a number of financial benefits to be gained by committing to corporate philanthropy. For example, it can improve the reputation of a business – a benefit which can lead to an increase in engagement and profit.

Consumers, especially Gen Z’ers, have become more interested in supporting businesses which show an active interest in managing their social impact and Merkle’s Next Generation of Consumer Behaviour report states that 83% of Gen Z-ers want brands to take a stance on social issues. With this in mind, transparency surrounding corporate philanthropy can certainly help to drive sales.

Top tips for implementation

Like any corporate strategy, implementing philanthropy into your business model or your ESG strategy takes careful consideration and planning. The best place to start is to define your approach and objectives, to ensure your philanthropy activity aligns with the company’s missions, values and budgets.

By having clarity on your approach and objectives, and including these in a detailed plan, it’s easier to ensure you have the resources to achieve your goals and articulate their benefits to ensure the support of key stakeholders. What’s more, it will allow you to build a strategy that effectively maximises its relevance and impact.

Clearly identifying which organisations you wish to support as part of your strategy helps keep the programme of activity efficient. Corporate philanthropy programmes are usually most effective if they are focused on a specific geographic area or social issue, such as health or education, and have a link to the sector or location in which a business operates. To do this, it’s a good idea to analyse a handful of chosen charities to minimise the risk of making poor decisions, which might have reputational or financial risks.

Another important element to consider is to find a team member, or group of team members, who will be responsible for driving your corporate philanthropy. Their role will be to act as the programme leader(s) and handle the day-to-day operational tasks. It is often useful to choose someone who is particularly passionate about social improvement, or who has a background in philanthropy, as they will be able to leverage your capabilities most effectively.

Once you have launched your corporate philanthropy programme, it’s also important to make sure you create a system for keeping track of metrics, to measure the programme’s impacts. This will not only allow you to maximise the overall impact effectively, but also communicate these key metrics to stakeholders.

Here at Liquid, we have a wealth of experience in helping our clients to communicate the positive impacts of their corporate philanthropy. If you’re looking for advice or support with this from a Birmingham PR agency, then we’d love for you to get in touch.