Business

Philanthropy adds to more than the bottom line

BY KAREEN THOMPSONS

Wednesday, May 16, 2018

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The way companies give is changing. Many of today's organisations are integrating philanthropy into the heart of the business, bringing benefits to employees as well as recipients.

Companies with strong corporate philanthropy programmes are increasingly seeing benefits to their own bottom lines. While the main focus is to help the recipients, there is growing evidence that they can also have a positive impact on the companies themselves.

From improved employee retention and recruitmentto boosting the authenticity of a brand and increasing trust, companies that engage in meaningful programmes are reaping the rewards. Philanthropy improves relationships between companies and their clients and potential clients and this helps to build support for the brand.

Consumers tend to support a brand because of the values associated with that brand.

There has been a shift in the way corporations approach philanthropy, with many moving from just donating money to setting up foundations that align with their core values and purpose as a business, as well as introducing employee volunteer programmes in which their own staff offer their time and skills to good causes.

Philanthropy enables business to meet corporate social responsibility expectations people have of today's businesses. If you are a company who needs to build trust and credibility with people, whether staff, the public, customers, shareholders, or whoever your stakeholders are, the public expects you to play a role in helping to address social issues.

Mobile phone network provider Digicel certainly embraces this culture. Digicel and its shareholders set-up a charitable arm — the Digicel Foundation — which is founded on the simple principle that as their businesses grow across regions such as the Caribbean, so too must the communities it serves. It has spent $122,180,269 in community investments to date.

In February this year, the Digicel Foundation, Trinidad and Tobago, partnered with the non-governmental organisation “Restore a Sense of I Can” (RSC) to launch four Tech Clubs in secondary schools on 'Safer Internet Day'. With Internet safety now a prime global concern, it was a very timely initiative, part of an overall Digital Citizenship Programme being funded by the foundation.

Elsewhere in the region, the Digicel Haiti Foundation this past January opened the PJ Mara de Jolivert National School. It is the Foundation's 174th school in Haiti. It serves the community of Jolivert, which lacked a school structure that conformed to international building codes. The number of students that attend schools built by the foundation in Haiti now totals 60,000.

While companies do not set out to gain from their philanthropic activities, many generate greater customer engagement. From a customer perspective, the philanthropy programmes give credibility to the companies' products and services, which leads to consumers appreciating them and wanting to spend money with them. It also helps brands to be authentic. Though not the intention, philanthropy helps to build customer loyalty and a willingness to continue the business relationship.

Strong corporate philanthropy programmes, particularly those with employee volunteer programmes, have also been credited with greater staff retention and engagement.

The 2016 Cone Communications Employee Engagement Study found that employees in the US increasingly want to bring their passions for social and environmental issues to the workplace. Three-quarters said that their job was more fulfilling when they were provided with opportunities to make a positive impact on social and environmental issues, while 58 per cent said these commitments were a factor when deciding where to work, and 55 per cent would be willing to accept a lower salary in order to work for a socially responsible company.

It is not just good for staff engagement; philanthropy programmes can help to develop leaders in organisations. Professionals are able to gain leadership skills and project management experience and network with people outside of their usual circle of clients. Volunteer work can also boost team members' morale, particularly if they value the idea of giving back to the community.

Team members who work together on a volunteer or charity event are able to get to know each other beyond the typical scope of work. The work itself may even improve teamwork on work projects.

Organisations that engage in philanthropy build the community in which they are situated. These social involvements provide opportunities for the community in areas where governments have not been able to reach especially from a financial perspective. The lives of individuals and families impacted are improved in ways that are unmeasurable and far reaching.

Organisations may also find that they derive competitive advantage just by genuinely carrying out philanthropy programmes, as their brands are supported and strengthened by the very community they serve. The organisation may not necessarily benefit from special tax advantage; however, the programmes increase the organisation's visibility and improve employee morale as they create social impacts.

Embedding philanthropy authentically in an organisation's corporate culture enables them to be better businesses. Culture is often driven from the top (through the board and senior management), ensuring that the company's values are upheld throughout the organisation.

Giving back to communities is personal. Programmes succeed in making a difference to their community and company culture when corporate philanthropy is in-built. Finance professionals can influence their organisations on the best ways to implement philanthropy schemes. Together organisations and their professionals can use their influence to help create better communities all around the world.

Kareen Thompson is the accountant at Specialised Imaging Solutions Limited.

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