Here's Why Successful Businesswomen Prioritize Philanthropy You might think nonprofit work is solely about burnishing one's reputation, but it's much more than that.
By Debrah Lee Charatan Edited by Frances Dodds
Opinions expressed by Entrepreneur contributors are their own.
As a businesswoman in the commercial real estate industry and a philanthropist in the New York City community, I'm well aware that philanthropy can amplify one's success and crystalize the vital relationship between giving back and enhancing business performance.
Related: A New Dell Initiative Asks Women Entrepreneurs to Give Back
When intelligently coupled, business and philanthropy build upon each another to produce both social and financial impact.
This occurred to me again when I read a report by the Urban Land Institute, about women in the real estate industry and smart work policies. I was struck that the majority of the women ULI surveyed, who held CEO or other executive positions, served on community nonprofit boards; so did nearly half of all women surveyed. As a woman who's had years of involvement in both real estate and philanthropy, I found that those statistics resonated.
Why? Because women young and old in our industry are not only proving that they care about more than just the bottom line, but are developing important skills from their philanthropic endeavors. Now, I don't know if ULI's figure is true for other industries -- but I am quite certain that the skills and mindset philanthropic involvement instills are useful across a range of professions.
Wrote ULI: "Many women leverage these external leadership experiences, which often make them better prepared for leadership roles within their own organization. Support for employee involvement in external organizations demonstrates the active role firms are taking in their communities."
Indeed, community boards and nonprofit organizations provide excellent experience for the corporate world. Leadership roles on nonprofit boards are especially beneficial, as they allow women the ability to demonstrate and build confidence in executive roles. Such experience feeds into career advancement.
Involvement in philanthropy, though, is much more than a resume builder -- just as charity is more than simply writing a check. While all levels of charitable involvement are beneficial, the more complex the role, the better the payoff. For example, community involvement in a woman's early-stage career can help her earn positions of leadership, or even grant her the know-how to build her own business. Once she has executive power, a wealth of new opportunities in philanthropy may well open up for the causes she cares about, and for business success too.
At the helm of her own business, she'll have the freedom to develop partnerships or even launch unique organizations alongside her company. She can use these initiatives to build relationships with clients, align her business brand with important social values and deliver competitive returns all the while.
Related: Study: Most of the World's Richest Philanthropists Are Self-Made
According to CECP chairman Doug Conant, philanthropy can act as a type of research and development for businesses. "Much like R&D," Conant wrote in an article for McKinsey, "philanthropy allows companies to make thoughtful investments in sectors where the return profile is typically more speculative."
In other words, philanthropic initiatives can act as an incubator for new business strategies, where leaders can test innovative methodology in an attempt to optimize impact, solve problems and learn what works best. Such experimentation, Conant says, can "help companies reduce business risk, open up new markets, engage employees, build the brand, reduce costs, advance technology and deliver competitive returns."
Finally, philanthropy that ultimately does good -- whether for the planet or the community -- reflects positively back on a business and its leadership. Some may think that this credential is solely about reputation, but it's much more than that. When a community is lifted by charitable endeavors, this boosts the company, and perhaps its profits, as a result. The reciprocal nature of the relationship between philanthropy and business means that doing good and doing well become one and the same.
It's no wonder, then, that the most successful businesswomen and female entrepreneurs have long histories with philanthropy, from big names like Oprah and Beyonce to fashion gurus like Sara Blakely and Tory Burch.
Related: 5 Easy Ways to Make Philanthropy Part of Your Company Culture
The best part is that female business women tend to support more women through their organizations, lifting a new generation of female breadwinners and their future endeavors, both charitable and corporate.
