What Is Corporate Philanthropy and Why Should You Care?

If the words “corporate philanthropy” call up images of pink ribbon campaigns, big donations to very visible causes, and big brands improving their image through charitable donations, hang tight. 

There’s a lot more to the picture than big-dollar donations to well-known charities and causes. In today’s business world, businesses of all sizes and in all sectors are committed to giving back to their communities through some form of charitable giving — and “charitable giving” takes on many forms. 

In fact, as of 2021, 85% of U.S. companies have a formal corporate giving program in place, and they donated a combined $20.77 billion to charitable causes. 

But what is corporate philanthropy, exactly, and what are the best ways for your company to give back to the community? The answers to those questions are evolving as a society — and employees — become more knowledgeable, engaged and interested in how the companies they deal with affect the world around them.

What Is Corporate Philanthropy? 

Corporate philanthropy refers to activities and investments voluntarily made by businesses to make a positive impact on the community around them. 

That’s a very broad umbrella. It covers everything from giving money to donating expertise and encouraging employees to volunteer for community organizations. If your company hosts a food drive for Thanksgiving, buys uniforms for a local soccer team, or offers a matching donations program for charitable giving, it is engaging in corporate philanthropy. 

Learn more about corporate giving and why it’s important in our resource section.

Who Benefits From Corporate Philanthropy?

The benefits of giving back are many, and not just for the organizations on the receiving end of donations. The business also reaps benefits, as do the employees and the general community. 

In a world where consumers increasingly expect companies to be socially responsible partners in our world, having a formal corporate giving program in place is a vital part of doing business. Charitable donations aren’t just a sunk cost of doing business, though. There are clear benefits for the company when they make the choice to give back. Those include:

7 Types of Corporate Philanthropy

The face of corporate philanthropy has been evolving rapidly, especially in light of the last few years of upheaval and technological advances. These are the seven most common forms of corporate giving. Many companies engage in more than one, and many more are rethinking their strategic corporate philanthropy plans as corporate social responsibility takes on more importance to customers and employees. More on that later. 

Employee and Board Stipends

Some corporations provide cash stipends to employees or board members, which they can donate to the charities or causes of their choice.  

Volunteer Support

Companies may organize, support or give paid time off to employees who volunteer for organizations in their community. The support may be technical — an accounting firm may provide training and expertise to a startup nonprofit, for example — or more general, such as gathering a team to help paint houses or build playgrounds in the neighborhood. 

Corporate Sponsorships

The Little League team, a fundraising event by the local food bank, a fashion show put on by a local charity — these are all examples of businesses using corporate sponsorships as part of their overall corporate philanthropy strategy. The corporation makes a donation to charity in return for being prominently mentioned during the event. 

Community Grants

A company may offer grants to community organizations that apply for them and meet specific criteria to qualify. Walmart, for example, offers grants ranging from $250 to $5,000 to local community organizations. Often, the grants are given through a foundation established by the company for the purpose of making corporate donations.

In-Kind Donations

In-kind donations are donations of goods or services instead of cash. This type of donation is more common among smaller businesses, such as restaurants donating pizza to a local homeless shelter, or providing coffee and donuts free of charge to a weekly parents’ group meeting. Similarly, many companies donate a “portion of x sold” gifts to charity. Stop and Shop, for example, donates a dollar to a local organization for each reusable shopping bag purchased by customers.

Donor-Advised Funds

Donor-advised funds — DAFs — are a variation on making grants to charities and causes through a foundation. In a nutshell, a DAF is like a personal charitable giving account, similar to a health savings account. The donor can make donations at any time and receive an immediate tax advantage. The funds sit in the DAF until the donor decides to disburse them to the charity or cause of their choice. DAFs offer several benefits that make them the fastest-growing charitable giving vehicle in the U.S.

Matching Donations

We saved this one for last because matching donation programs are among the most common corporate giving programs — 9 out of 10 companies have employee matching programs

Traditionally, an employee makes a donation to a charity or cause, and then either they or the nonprofit submits a form to the company, which then makes a second donation to the charity, effectively doubling — or sometimes tripling — the original amount. 

Despite their popularity, matching gift programs account for only about 12% of cash donations received by nonprofits, and an estimated $4 to $7 billion in matching gift money is never distributed. That’s because the entire process can be cumbersome, both for your HR department and for the nonprofit receiving the donation. 

A New Kind of Corporate Philanthropy — Philanthropy as a Service

Groundswell believes that it’s time to rethink how matching donations programs work. Groundswell makes it easy for companies to launch a charitable giving program that takes advantage of all the benefits of a DAF for them and their employees. The Groundswell platform unlocks the potential of DAFs reimagining corporate philanthropy using the x-as-a-service model. 

Philanthropy as a service — PHaaS — lets you skip the complicated process of setting up a foundation, hiring accountants and handling all the day-to-day nuts and bolts of managing a charity. 

Instead, you get a simple, transparent platform that allows your company and your employees to support the causes they believe in without all the friction that accompanies traditional matching donation programs. 

Your company reaps the benefits of having a defined charitable giving program. Your employees are more engaged, with their privacy protected and their autonomy honored, and the causes they support get their donations without the hassle of chasing down the matching funds. 

It’s a win-win-win solution that empowers everyone in the equation.

Final Thoughts

Corporate philanthropy has evolved over the years, and it’s evolving faster than ever thanks to technological advances and changing social attitudes. If you’re ready to take the next step in corporate philanthropy, reach out to us to learn more about what PHaaS can bring to your company.

How To Boost Employee Morale Before, During and After Smartsizing

Dealing with layoffs and the resulting fallout after a company downsizes can be one of the most difficult tasks to face for any manager or human resource professional. It’s no secret that layoffs can take a major hit on company morale, not just for the workers who are being laid off, but for those who remain. Finding ways of keeping morale high in a workplace that has just downsized can be tricky, but it’s vital. Taking steps to reassure your remaining workers that they are valued and their jobs are secure can go a long way toward cementing company loyalty and making your business a place where employees want to work.

Behind the Wave of Smartsizing

The headline on the Business Insider article is stark: “A Wave of Layoffs Is Sweeping the U.S.” The article goes on to detail dozens of businesses that have downsized since the beginning of 2022, including many that made headlines: Netflix, Gap, Carvana, Ford Motor Company, Peloton and Wayfair among them. These layoffs follow two years of corporate and labor downsizing during COVID-19 when nearly 15% of U.S. adults reported that they were laid off because of the pandemic. While many of those were rehired — or found other jobs when businesses reopened — other businesses shed workers they’d hired to deal with a temporary boost in work during the shutdowns. To compound things even further, the Federal Reserve’s plan to fight inflation has many experts fearing that even more layoffs are coming

The truth is, though, that layoffs are an unfortunate fact of life in the modern workplace. Even without the extraordinary pressures of the last few years, businesses often choose to reduce their workforce for strategic reasons — to cut costs in the face of bankruptcy, because they’ve adopted new technology that requires fewer workers, or because a project has ended. When layoffs happen, the fallout can negatively affect everyone involved — and your business suffers. Taking an open, transparent approach to the situation is one of the most effective ways of managing employee morale before, during and after the workforce reduction. These tips can help you plan how to boost employee morale during these difficult times.

Before Layoffs — Make a Plan and Communicate It

There are a few throughlines in managing employee morale during layoffs — careful planning, open communication, transparency and respect for your employees. This starts from the moment your company decides to restructure. 

Have a Plan and a Process

Creating a layoff process — preferably before you ever have to use it — is helpful for many reasons, not the least of which is making sure that your company is in regulatory compliance. More importantly, when there’s a process, it informs everyone in the chain of command, from the front office to line managers, of their role and responsibilities. 

Communicate Openly, Effectively and Respectfully

Carefully consider how you’ll announce the layoffs — who will tell employees, how they’ll deliver the news and what they’ll say. In general, the news should come from a direct supervisor and should be delivered in person. The announcement should include the reasons for the downsizing, the steps the company has taken and what employees can expect to happen over the next several days. The person delivering it should express compassion and understanding, and be prepared to answer questions and manage employee reactions. The manager should also explain any assistance and benefits the company will provide for the workers whose jobs will be eliminated, and make a promise to keep the lines of communication open throughout the transition to a smaller workforce. Above all else, be honest and authentic in all of your communications. Your employees deserve your honesty.

Speak With Individual Employees Privately

Schedule private interviews with employees to discuss particulars about their situations. Give them time and space to express their emotions, and listen compassionately. Have any paperwork and informational handouts prepared in advance, and go through them together. Provide them with any information they need to access accrued benefits, as well as any processes or paperwork they need to transfer insurance policies, employee giving accounts and other benefits to themselves. 

During Layoffs — Be Transparent and Compassionate

The days and weeks immediately after an announced downsizing can be among the most difficult to manage. You can make it easier when you follow a few simple guidelines.

Get It Done Quickly

If possible, inform all employees that are part of the downsizing immediately. The longer it takes for everyone to know their status, the more time your employees will spend stressing and worrying if their job is on the line. 

Communicate New Directions Clearly and Promptly

Your remaining employees — known colloquially as survivors — know that things are going to be changing. Be open and honest about the plan going forward, and listen to any feedback they offer. The better they understand their evolving role — and the company’s evolving plan — the more comfortable it will be for everyone.

Be Available

As employees settle into their new workplace environment, make yourself available as much as possible. Don’t just wait for them to come to you. Go out of your way to check in with people. Reassure them, solicit their feedback on changes and step in to take up the slack as people adjust.

After Layoffs — Reassure, Reconfigure and Stabilize

As the workplace stabilizes, recognize that employees may still be dealing with the aftereffects. Downsizing survivors often have complicated feelings, ranging from continuing anxiety to survivor’s guilt. The steps you take now are not just a short-term strategy — think of them as a blueprint for employee engagement going forward.

Reconfigure and Regroup

Continue to be available to answer questions and help employees sort through their new responsibilities and roles. Listen to concerns openly and with compassion, and be willing to take feedback and criticism without taking it personally. 

Rebuild Trust and Goodwill

This is the time to turn back to everything you know about building a healthy workplace culture and put it into practice. Keep in mind that this is a key “moment that matters,” and the actions you take now will resonate with employees for as long as they stay with you. For example:

  • You can offset the reality of giving employees more responsibility by shifting to more flexible schedules that take their lives into account
  • Give employees more voice in decisions that affect them most
  • Review your current benefits package with your employees and find ways to make it more meaningful to them

The Bottom Line

Restructuring and downsizing are never fun, but this can be an opportunity to make other positive changes in your company. Setting up a meaningful employee giving program is one of those positive changes. Groundswell can help you get a corporate giving program up and running faster than any other. Our platform makes the entire giving process more efficient by establishing a personal giving fund for each employee  while reducing the amount of tracking and work for your HR department. Best of all, it’s designed to respect and support all of your employees’ diverse perspectives and shows them that you’re truly committed to building a respectful, inclusive, diverse workplace for everyone.