Head off what could morph into a thorny HR issue. Leadership might want to identify a manager and, in close collaboration with that person, restructure the role to include philanthropy, Pine says. Or the company could recruit volunteers from the staff and form an employee giving committee that makes collective decisions.
"Another option is to outsource," Pine says. Her organization and others across the country will manage grant making for funders, and can assist with the formation of giving committees, training them on evaluating organizations and projects before dedicating resources to them. Pine says that philanthropic initiatives can actually improve employee retention, and make recruitment easier.
Dig Deeper: Giving Back as a Company
Incorporating Philanthropy Into Your Business: Get to Know Your Community
Successful philanthropic endeavors have something in common: they are built steadily over time. The impact ultimately comes not just from which organizations receive funding but also the development of positive, lasting relationships between companies and their communities.
"Our philanthropic model is not a top-down model. It doesn't rely on the rich and powerful," Hannigan says. "We poll the grassroots." Give Something Back asks customers in specific geographic areas they serve to decide where to invest the profits. They are most likely to know which organizations will be effective.
"If it's a bad decision, the organization will not earn the respect of the people who live in the community," Hannigan says. Letting the community decide has other benefits, too. Successful projects reflect well on the business, which could influence consumers and clients who are constantly making choices in the marketplace.
Dig Deeper: The Way I Work: Blake Mycoskie of Toms Shoes
Incorporating Philanthropy Into Your Business: Find Projects That Are the Right Fit
When sizing up a nonprofit, use similar basic criteria that an investor would in a for-profit venture: Take a close look at the organization's leadership, programs, activities, and strengths, as well as the risks associated. Do due diligence by assessing their track record and financial stability.
"In our work we always push companies and funders to develop other criteria that might be very specific to the business," Pine says. For example, an R&D company centered on innovation might intentionally seek to fund innovative approaches to furthering their goals. That could mean thinking about what will resonate with employees and other stakeholders.
Employees might be the motivating force, deciding on an issue that matters to them. Ellinger also suggests talking to a foundation. "You could ask the local community foundation in the area to give you a docket of projects in the area you're focusing giving," he says. There are hundreds of these foundations across the country.
When philanthropic funds become available, word gets around. Pine recommends publishing proposal guidelines and being prepared to say no to proposals that don't fit. "For companies it's particularly challenging because they don't want to create bad will within the nonprofit community," she says. Decline gracefully by restating the goals and wishing the organization luck.
Dig Deeper: Taking the Buffett-Gates Pledge
Incorporating Philanthropy Into Your Business: Start Giving Strategically
Even small gifts can be highly effective. Pine and her colleagues worked with a funder in Boston that wanted to foster greater interest in science and math at area schools. On the surface the issue appeared extremely large and daunting. TPI began talking to experts and learned that interest tends to drop off in middle school. It asked middle school science teachers what, precisely, would help.
"There are teachers with creative ideas on how to engage students, but they just need a little bit of money for more hands-on experiences," Pine says. It turned out that a trip to the aquarium made a big difference. For several thousand dollars, the funder could transform students' lives and inspire them for life.
Step back and do an assessment, ideally at least once a year. Review accomplishments and communicate them to key stakeholders. Hannigan says his company has given away 78 percent of all of the profits it has made since 1991, leaving 22 percent to be donated in the future. Last year the company only made $30,000 in profits, but he says that what really matters is who benefits from the surplus once the bills are paid.
"Every company gives its profits away. Chevron gives its profits away — they give it away as dividends to their investors," Hannigan says. For him and many other companies like his, the marketplace is a tool to create wealth and resources that can be distributed back through the community to solve myriad problems. That way, everyone profits.
