What's the Best Way for Your Business to Give Back? Like it or not, entrepreneurs are responsible for creating lasting change in business and society.
By Scott Monette Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
Entrepreneurs, as Georg Kell puts it, are the "custodians of tomorrow." Whether we accept it or not, we entrepreneurs have the responsibility to create lasting change in business and society. In my own case, my son opened my eyes to that reality.
Related: Spotlighting Your Social Responsibility
Earlier in my career, I had served as CFO of Ralcorp Holdings, a multibillion-dollar public consumer products company. But when my son was born with disabilities, I longed to do more to give back. I learned that 1 in 5 Americans live with a disability, and that the labor force participation rate for people living with disabilities (PLWD) is just 31 percent. Of all Americans in long-term poverty, two-thirds are living with disabilities.
With those sad statistics in mind, I leveraged the most powerful tool I knew to combat inequality: entrepreneurship. I started 100 Percent Wine, with a pledge to donate its profits to nonprofits working to create employment opportunities for PLWD. My goal was, and is, to challenge stereotypes around what the disabled can accomplish if they are only given the chance.
Related: The Business of Good
Today, although my company is still young, I've seen an incredible outpouring of support for its mission. So, all you entrepreneurs out there: If you want to harness the power of corporate social responsibility (CSR), here's how to create and cultivate support for your own company's calling:
1. Make the business case for giving.
To convince company stakeholders, show them that economic value and social value aren't mutually exclusive. Share the numbers on how social responsibility intersects with profitability. For instance, in the past decade, socially conscious companies have outperformed the market by a factor of nine.
This, in part, is the case because 55 percent of consumers are willing to spend more with companies that demonstrate they care. Globally, 84 percent of consumers say they seek out socially responsible products.
As Michael Porter and Mark Kramer wrote in the Harvard Business Review, "Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success."
Related: The Power of Giving Back: How Community Involvement Can Boost Your Bottom Line
2. Democratize the process.
No social initiative can succeed if only a company's leaders are on board. But don't force charitable priorities down team members' throats: They'll see right through that, and engagement will plummet.
Draft a list of preapproved charities, and allow employees to vote on which charity the company should contribute to. Match employees' contributions and consider designating a day for companywide volunteering. Employees who contribute directly (financially or in-kind) will feel most connected to the cause.
3. Align charitable and business objectives.
A corporate philanthropy that supports your business will strengthen your brand. But the cause must align with your business -- an automaker supporting criminal rehabilitation, for instance, would confuse customers and muddle its brand identity.
A good fit makes sense with your business objectives. Financial giant Citigroup assists people who don't have access to formal financial services; life insurer New York Life supports a foundation focusing on child bereavement. And beverage company PepsiCo is committed to improving water quality. No cause is wrong to support, but customers must see the connection.
4. Calculate the return on investment.
Think of charitable giving as an investment, and demand the same results and transparency you would from any other investment.
Employ a process of continual accountability. Obtain a quarterly report from the charity on how your dollars are spent. Publicize the good that comes from your company's commitment.
Don't forget to look at the effort from an internal perspective, too. Are volunteers happier than other employees? Are they earning more promotions and staying longer? Determine whether the initiative is a good value by considering both the company's impact on the cause and the cause's impact on the company.
5. Manage your CSR program either internally or externally.
Embed social change into your business model to create a virtuous cycle. You might form committees, for instance, or hold monthly town halls or implement quarterly days of service.
Don't want to deal with managing your program? Organizations such as Good360 match corporate donors with prescreened charities and help manage the exchange. JPMorgan and Nike use Good360 for that very reason.
The business of giving back doesn't have to be complicated. Set a mission and goals for your giving program. Narrow your focus to maximize your program's impact.
Related: 7 Steps to Up Your Corporate Social Responsibility Game
Finally, align your business and charitable goals. Measure and communicate results. It's that simple.
