How to Make the Most of Your Company’s Community Involvement and Outreach Efforts
Giving back to the community in which your business is located not only makes for good corporate citizenship but can be fulfilling on a personal level both for you as a business owner and for your employees. Donating time or money helps engage your workforce and creates building blocks for a positive corporate culture.
There are many charitable options available for a business to choose from. That can make it difficult for a small to midsize business to easily pick from among the worthy choices. Unlike large companies that give a consequential gift to a number of charities, small to mid-sized businesses may choose only one or two organizations to focus their donations each year. Therefore, choosing where to donate time and money can be a critical decision for a company and its employees.
Philanthropy increases your company’s community visibility and provides a platform to share company values and culture with the community and prospective employees. Additionally, your employees can connect and engage in team building while serving their community.
A successful charitable giving campaign is one that has the support of a majority of your company’s employees. A charity that aligns with your company’s stated mission and goals or one that has deeply rooted connections to the community is likely to be well received by your employees. Local charities may already be known to you and your employees. The effects of the work, time or money donated to local charities may be immediate. Donating locally also provides a level of assurance that gifts are being used as intended.
Identifying what is needed locally is usually not a complicated process, in fact, it is not uncommon for a local media company to advertise what is needed in the community. However, if you are unable to identify a local charity that aligns closely with your company’s mission and goals, websites such as GuideStar, and the Better Business Bureau Wise Giving Alliance provide information about nonprofits.
Another way to ensure that your corporate giving has a direct and positive effect in the community is to allow employees to direct donations. Employee-directed giving allows employees to support those charities that they are passionate about. It is advisable that the employer establish the parameters. For example, the directed donation must go to a registered 501(c)3 that it provides services directly to the local community.
Although there is no set amount of money a small business is required to give back to its community, a general guideline is about 6 percent of profits, according to the article “Small Business Guide to Charitable Giving and Tax Deductions” by BusinessNewsDaily.com. However, smaller companies may make a greater impact by giving time rather than money, such as volunteering for a local sports team or at a local food bank. A small business should consult with their tax advisor before initiating a company sponsored charitable giving event.
Lastly, the cold hard truth is that scammers abound, and small businesses are common targets. Be vigilant and vet all prospective recipients. Red flags include unsolicited requests for donations from an unknown charity, high-pressure or urgent requests, unsolicited emails, requests for cash, gift cards, Venmo transfers and the like. Scammers may use well-designed websites and deceptive names. It is advisable to confirm any request with a phone call, but do not use any contact information or links contained in the unsolicited email and instead call your local chapter directly.
For further information on the subject, the U.S. Federal Trade Commission has a webpage dedicated to scams and a specific tab for charity-related scams at https://consumer.ftc.gov/all-scams/ charity-scams.
For more information, contact Janine McClintic at MacDonald Illig Attorneys at email@example.com or 814/870-7715.