The Benefits of Giving Back for Business

The Benefits of Giving Back for BusinessWhen it comes to charities, supporting one is one of the best moves a company of any size can make.

When a portion of what we spend on a product goes toward a charity, it gives us an innate sense of doing good and of accomplishment. The same goes for a company’s internal operations. When employees are given the opportunity to give back, either through mentorship programs, toy drives or even just a simple tax-free donation, it helps to raise morale all around.

And it’s a practice supported by some of America’s biggest companies. According to The Chronicle of Philanthropy, in 2012, Google donated 9.3% of its profits — approximately $144,606,000 — to charity; Target donated 5%, or $147,038,722, of its profits to charitable organizations; and Walmart donated 4.5% of its profits to charity, totaling $311,607,280.

In fact, according to CharityNavigator.org, total giving for 2012 came to $316.23 billion with corporations accounting for 6%-a 12.2% rise from the year before.

Regardless of how much is given every year, associating your business with charity is a positive investment all around as it helps to increase customer relations, employee morale and your bottom line. And while it may seem like there are more than enough charities to choose from out there, taking the time to investigate the details of your potential partners will help ensure a healthy and equally profitable relationship in the future.

Choosing a Charity for Your Business

So how do you choose a charity to support from over 1.5 million charitable organizations out there? Start by looking at your own company and what charity’s values are most in line with your overall business focus. For example:

  • A construction company might consider supporting a charity that builds homes for low or no-income families.
  • An accounting firm could support an organization that provides free math tutoring and/or mentoring to at-risk students.
  • A homemade craft business could donate an item to a charity auction supporting arts education.

You can also look to your employees, shareholders and customers for their opinions on the best charity or type of charity to support. It’s likely that many of them already have an organization or two in mind.

Questions to Ask When Choosing a Charity

Once you have a list of potential organizations, the next step is to ensure that your charity of choice is not only legitimate but also provides you with important information regarding how your donation is spent. When reviewing your top choice or choices, consider asking the following questions:

  1. Does it meet IRS criteria for a tax-exempt organization? Check with online charity overview websites such as Charity Watch or CharityNavigator.com, or ask the organization for a copy of its letter of determination.
  2. Does it provide detailed financial reports to its donors so they can see how their contributions are being spent?
  3. Do you feel comfortable with the organization’s leadership and programs?

Establishing a Charitable Relationship

Finally, before committing fully to your charity of choice, consider working with them for a pre-set trial period to determine if it’s the best fit for you and your company. And if for any reason you can’t find a charity that meets your specific criteria, you can always consider starting your own!

No matter how you approach it, finding ways to give back – from creating a full partnership to simply donating your time on a volunteer day – can be an excellent and beneficial business investment.

Myrna Vaca is the Head of Marketing and Communications at Lyoness America, where she is responsible for marketing, communication and business development efforts. The Lyoness Child & Family Foundation (CFF) is actively involved in supporting children, adolescents and families worldwide, especially in the field of education. Check out Lyoness on Facebook.