6 Types of Corporate Philanthropy

Companies today are not just expected to generate profits; they are also expected to give back to their communities. Businesses that give back are viewed more positively and people are more likely to trust and support them. Companies interested in social impact have the opportunity to explore corporate philanthropy as one component of a larger subset of charitable giving programs available to them.

In this article, we’ll explain the many facets of corporate philanthropy, providing insight and recommendations companies can  incorporate to make a positive impact on their communities.

What is Corporate Philanthropy? 

Corporate philanthropy is defined as the ways in which a company gives back to its community or promotes the welfare of others. Most commonly, corporations donate money or time to nonprofits to accomplish these goals. Each company’s charitable giving program will look different based on  the company’s values and its employee base along with other various stakeholders the company serves within the community.  The Harvard Business Review refers to this as a competitive advantage that “enables companies to leverage not only their own resources but also the existing efforts of nonprofits and institutions” they want to partner with.

Popular Types of Corporate Giving Programs

1) Matching Gifts

Matching gifts is the most popular type of corporate giving.

Companies match the donations their employees make to nonprofits that are usually deemed eligible by the company beforehand (e.g., health or educational institutions).

 

The company will typically give a percentage of the donation made by the employee on an annual year to the nonprofit.. In some cases, the company will donate triple the amount of the initial donation, increasing the donor’s impact even more.

 

Benefits of corporate philanthropy and matching programs:

• Employee engagement: Corporate philanthropy and matching programs can help increase employee engagement by providing employees a way to give back to the nonprofits their employees care about the most.
• Employee morale: Corporate philanthropy and matching programs can help boost employee morale by showing employees that their company cares about giving back to their communities.
• Company reputation: Corporate philanthropy and matching programs can help improve a company’s reputation by showing that the company cares and is committed to social responsibility.
• Tax benefits: In some cases, corporate philanthropy and matching programs can provide tax benefits for a company.

Learn more about how donation matching works.

2) Matching Dollars for Volunteer Hours

Volunteer grants are another incredibly popular type of corporate giving. Companies offer volunteer grants, sometimes referred to as matching time, service credit, volunteer matching, etc., to reward their employees’ volunteer efforts with a monetary donation to the nonprofit where they serve. The dual benefit of offering volunteer grants is employee engagement and community support. It’s a way to turn time into money.

How it works:

• An individual volunteers with a nonprofit on a regular basis.
• The volunteer checks if the nonprofit is eligible for a volunteer grant or matching donation of every hour served from their company.
• After verifying the nonprofits’ eligibility, the volunteer submits their application for a volunteer grant to their company.
• The company reviews the application and confirms the volunteer hours the volunteer has worked for the nonprofit.
• The company sends the nonprofit a donation through a giving portal such as Benevity, YourCause or CyberGrants

3) Grant Making Foundations

Grant making foundations, or corporate foundations, are a type of corporate giving where businesses establish their own separate-entity foundations as a formalized approach to manage their philanthropic efforts.

Common grants include:

• Capital grants: Money given to a nonprofit to purchase, construct or renovate tangible assets, like a nonprofit’s facility.
• General operating grants: General operating grants, also known as an unrestricted grant, is money given to a nonprofit allowing it to use the funds where they’re needed most.
• Program-specific grants: Program-specific grants require a nonprofit to submit a proposal for a specific project they need a corporate foundation to fund. The proposal will communicate how the program they are requesting funding for aligns with the corporate foundation’s mission.

It is also not a requirement for a company to set up a Foundation to make a charitable donation to a nonprofit.

Recommendation: If setting up a corporate foundation is something your company would like to pursue further, please seek appropriate legal counsel.

If your company is interested in supporting Children’s Health with a grant or cash donation, please email corporate@childrens.com.

4) Corporate Sponsorships

Corporate sponsorships, another type of corporate giving, are mutually beneficial partnerships between businesses and nonprofits. Usually, companies will provide financial support for a nonprofit’s event or initiative through sponsorships that align with their values and business goals in exchange for brand exposure. 

Tips to keep in mind if you’re considering this type of corporate giving:

• Partner with a nonprofit that aligns with your company’s mission and values. To create a meaningful partnership, sponsor a nonprofit that shares your company’s commitment to the same causes, has goals and activities that will resonate with your employees, customers and stakeholders to maximize the sponsorship’s impact.
• Clarify objectives and expectations between your company and the nonprofit. Decide your company’s level of involvement whether it’s financial support, in-kind giving or employee volunteer opportunities and determine what your company expects to receive in return.

Leverage engagement with the nonprofit. Get the most out of the sponsorship by actively engaging with the nonprofit’s event or initiative. For example, when sponsoring an event, promote your support through various marketing channels like social media and email to boost brand visibility and connect with your target audience.

Children’s Health hosts a fun annual event called Swing Fore Miracles, a corporate-focused tournament at Topgolf offering companies sponsorship opportunities and a team building experience for employees to support our mission to make life better for children.

5) Cause Marketing

Causing marketing is a type of corporate giving when a company partners with a nonprofit to support their cause. The company will create a marketing campaign to promote its products and services while raising awareness for the nonprofit’s cause simultaneously.

The objective of a cause marketing campaign is to call the company’s audience or customers to action.  When the audience or customers are exposed to the company’s marketing materials promoting both the nonprofit’s cause and the company’s products or services, it should motivate them to take action to support the nonprofit whether it’s to donate, make a give-back purchase where a portion of the proceeds received are given to the nonprofit, .

Insert Volleman’s Example of engaging patients to provide artwork, a community-wide vote and then getting a percentage of the proceeds.

For example, Volleman’s Family Farm, a Texas dairy farm, invited Children’s Health patients to participate in a bottle design contest for a chance to have their artwork displayed on milk bottles sold across Texas for a limited time. Children’s Health and Volleman’s held a community-wide vote to select the winning design, the patient-designed bottles were sold in stores and a portion of the proceeds were donated to Children’s Health.

6) In-Kind Donations

In-kind donations is a type of corporate giving that allows companies to donate products, resources and other non-monetary gifts to nonprofits. Giving back as a team at any time of the year can be a fun way for employees to engage, connect and support nonprofits. Year-end or around a holiday is also a popular time of year for companies to give back because of the holiday season’s focus on generosity and the personal tax benefits individuals receive.

In-kind donations allow companies to use their unique assets (such as tech firms donating software) to benefit nonprofits and improve their resource allocation.

Tips for getting started with in-kind donations:

• Understand the nonprofit’s needs. Before making in-kind donations, connect with the nonprofit you intend to support and find out their specific needs. To ensure your company’s contributions will be relevant and impactful, consider factors like the populations they serve, their mission and their programs that require immediate donations. Children’s Health has a couple of much needed items (link to the GIK page) that they update regularly.
• Keep transparency with the nonprofit. Define the terms and conditions of the donation, including logistical details like delivery, storage and distribution. Be sure to check in with the nonprofit to evaluate the impact of your company’s donation and any concerns that may emerge.
• Leverage your employees’ engagement. Engage your employees in the process of selecting and delivering in-kind donations. For example, a clothing company might donate special T-shirts for patients at a pediatric hospital and hand-deliver them to patients while also getting a chance to meet them.

Learn ways to donate in-kind to Children’s Health.

Begin Your Corporate Philanthropy Journey

There are many ways companies can get involved with and support nonprofits. The main benefits are employee engagement and morale, company reputation and the support of a good cause. Speaking of good causes, get involved in corporate philanthropy with Children’s Health to make life better for children!