How To Become a Philanthropist: 7 Steps To Change the World
If you’re wondering how to become a philanthropist, it’s easier than you think. Anyone can do it and, contrary to popular belief, it’s not just for the wealthy. Make no mistake about it: Humans are social creatures. We love to help one another. That’s why philanthropy is so popular. It’s a feel-good activity that improves our world. And the benefits far outweigh the costs.
Before you start contributing to worthy causes, however, it helps to understand the options available to you. You’ll want to make good decisions so that you maximize the impact you want to make in the world. No worries, either, about how much — or how little — money you have. All you need is a vision and a plan.
What Is Philanthropy?
A philanthropist is an entity, either a person or a corporation, that provides time, money, or resources — and perhaps all three — to people or nonprofits in need of assistance. The overarching goal is to make lives better for others (or the world we inhabit). Philanthropy is often associated with large sums of money and wealthy people. But, as mentioned, philanthropists can be any person or entity. Even a tiny business can be philanthropic.
Some philanthropists rise to rockstar status and are known for their generosity. For example, Warren Buffett, Melinda Gates and Oprah Winfrey are just a few among the mega-rich who have given large sums and had an impact on important social and environmental issues. But you don’t have to be a millionaire, and indeed – many nonprofits are supported by hundreds of thousands of people who give modestly. Even a relatively small donation – alongside hundreds of others who also are giving a small amount – can add up to hugely impactful levels of support for nonprofits working to support communities in need.
What Philanthropy Looks Like
Philanthropy can take a number of forms. These include, for example:
Money: Donations may be one time only or on a regular basis. Philanthropists may also bequest money after death or establish a trust.
Time: Those who don’t have money to donate or prefer to contribute in other ways can donate time and labor. Examples include volunteering at a homeless shelter or tutoring students after school. As with monetary donations, these can be one-time, yearly or more frequent contributions. Many small, community-based nonprofits are dependent upon the generosity of their volunteers’ time to extend the impact of their mission.
Resources: These donations, known often as “in-kind,” include furniture, vehicles, food, clothing, toys, computers, etc.
Benefits of Changing the World With Philanthropy
It may seem to be a cliche, but the benefits of philanthropy are immeasurable for those donating time, money or other resources:
- Lends perspective: Philanthropy heightens your sense of connectivity to the world and the things that really matter.
- Better health: Your mental health and physical wellbeing both improve when you give back.
- Lower stress levels: Volunteering has been proven to lower stress and enhance feelings of well-being by releasing dopamine.
- Tax reductions: Donations may be written off on personal taxes.
- Social interaction: Volunteering can offer opportunities to network and meet others who are committed to similar causes, and connections can be formed among a group of donors providing financial support.
- Improved skill set: As a volunteer or a donor who has researched the causes that nonprofits are working on, you will learn new skills, both hard and soft, and improve your leadership acumen.
How To Become a Philanthropist
As with any good strategy, you’ll need a road map to get to your final destination. Follow these seven steps to become a philanthropist:
1. Clarify Your Goals
Before you decide where to put your time and effort, you’ll need to understand what’s most important to you. What do you value? Where can you make a difference? What would feel good to do? Include your personal or professional goals such as expanding your network. Whether it’s working for climate change or helping your community’s underserved population get the resources they lack, make sure that you feel passionate about the issue.
2. Determine Your Commitment
Before you decide what to do, you need to determine how to do it. Do you want to give money or time? If it’s money, what can you afford? If you plan to volunteer, how much time do you have? When can you volunteer?
3. Choose Your Organization
Once you know the type of commitment you can make, research and vet organizations. Do they align with your mission and values? Where do they work? If you know you want to focus on homelessness in your community, determine if the organization is serving the homeless population in your city. Most organizations share information about their programs, their leadership and how they use their charitable donations. If you have questions, ask. The organization should be transparent and credible.
4. Check With Your Company
Before you completely nail down a target nonprofit, check out the support your company may offer – whether that be a match or volunteer opportunities.
5. Establish a Plan
Based on the causes you care about, the resources you want to commit to and the organizations you want to support, determine your giving cadence. For many, setting up recurring, monthly donations means you can ‘set it and forget it.’ But you might also want to consider setting aside some funds for donating during an emergency – whether it’s a hurricane on the Gulf Coast, the war in Ukraine, or a social justice issue.
6. Stay Engaged and Curious
Find your community, and learn about other organizations that are doing important work in support of the causes you care about. You might find that in order to tackle an issue that you’re passionate about, multiple organizations are needed to make change. You can create social connections in-person or online to discover more organizations.
7. Trumpet the Cause
Now that you’re a practicing philanthropist, tell others about the organizations you support and why. They may be inspired to help or to find a cause of their own.
Have Fun With It!
Philanthropy is something anyone can do. Whether you donate time or money, it offers great benefits and improves the lives of others. Find the organization or cause you want to support and go for it. It’s a fun and easy way to give back to the community and expand your horizons.
If you would like to know more about a corporate giving program, contact Groundswell. We can help turn philanthropic giving into an essential employee benefit.
Determining Your Corporate Donation Budget: How Much Should You Donate To Charity?
When a company donates to charitable causes, they benefit in several different ways beyond doing good for the community. Charitable donations pay off in goodwill and reputation, deeper community connections, better customer relations and increased employee engagement and retention. That’s in addition to any tax benefits your business might accrue through charitable donations. But how do you determine how much you should donate to charity? Let’s walk through the benefits and calculations that can help you make that decision for your company.
5 Benefits of Corporate Philanthropy
When you understand the varied ways that giving back to the community can benefit your business, it gets a whole lot easier to assign a value to it. This isn’t an exhaustive list of the pros, but it can be helpful framing when you’re deciding how much to budget for charitable donations.
1. Giving Back to the Community Improves Your Company’s Reputation
Today more than ever, customers want to do business with companies that put giving back at the core of their business operation. In fact, 85% of consumers say they have a more positive view of businesses that support causes they care about.
2. A Strong Employee Giving Program Increases Employee Engagement and Cohesiveness
Donation matching and other corporate giving programs are valuable benefits. In a recent survey, nearly half the companies who responded said that their corporate giving program helped increase employee engagement.
3. Offering a Corporate Giving Program Helps Attract and Retain Top Talent
In the same survey, nearly 60% said that their giving program is important in attracting and retaining top talent. In addition, corporate social responsibility (CSR) programs help develop strong leadership skills in your employees.
4. Giving Back to the Community Deepens and Broadens Community Connections
When your company and employees support local charities and causes, you increase your opportunities for networking in the community. Companies that follow the lead of their employees in choosing causes are more likely to engage with important organizations within the community.
5. Companies With an Authentic CSR Policy and Giving Program Build a Loyal Customer Base
Your company’s commitment to making a difference matters to your customers, especially millennials, Gen X and Gen Z. Today’s consumers expect businesses to be good corporate citizens — and they vote with their wallets. They also vote with their social media accounts — 82% of millennials interact with their favorite brands online, and will publicly support companies they admire.
How Much Should I Donate to Charity as a Corporation?
The key factor in deciding how much your company should donate to charity is your balance sheet — in other words, the amount you budget for philanthropy should be what you can afford to give without affecting the cash flow you need to do business. That said, there are some industry standards and best practices.
Many large corporations — and smaller businesses — earmark 1% of their pre-tax profit for charitable giving. This isn’t a hard-and-fast rule. Some companies give considerably more. Whole Foods, for example, donates 5% of its after-tax profit to charity each year, and small businesses — those with fewer than 100 employees — contribute an average of 6% of their pre-tax profits to charity.
Some small retail or service businesses choose to donate a percentage of each sale rather than calculate an annualized figure. A local brewery, for example, might funnel all profits from the sale of a particular brew into their corporate giving account. A realtor might designate a percentage of each completed sale as a donation to their corporate giving fund.
Using a percentage of your profit as a giving guideline makes it easier to scale your donations as your business grows, but it can make it difficult to budget for the year ahead. Author Curt Weeden, one of the most influential voices in the area of social philanthropy, proposed a simple formula to help businesses set their corporate philanthropy budget, which he calls the Sabsevitz Ante-Up Formula: Multiply last year’s pre-tax net income by 1.2%.
Once you’ve established a target amount for your giving, you should do three things to increase the impact of your donation:
- Make it part of your operating budget.
- Keep your employees informed and engaged with frequent updates.
- Make your corporate giving philosophy part of your marketing and outreach strategy.
Choosing a Charity for Your Donations
There are two main ways to choose which causes and charities your company will support.
- Top-down decision where your board or leadership team identifies one or more causes the company will support with donations, matching donations and other forms of corporate giving.
- Inclusive decision making where employees choose and/or recommend the causes and charities that matter the most to them.
More and more businesses are opting for more inclusive ways of determining the causes their company will support. There are a number of benefits to this approach.
- Employees who participate in decision making are more engaged and more likely to feel like they’re valued and making a difference. Engaged employees are good for your business.
- Your employees live in the community, which gives them unique insights into the organizations and people who do good work in the areas that matter to them. Employee decision making is good for the community.
- The more involved people are in choosing where to direct donations, the more invested they are in the program. This results in more donations to charities, which is good for the nonprofits involved.
Ways Your Company Can Donate to Charity
There are many ways your company can give back to the community, including several different models for making monetary donations. Some of the most common include:
Volunteering for a Cause
Serving dinner at a soup kitchen, building playgrounds for schools or helping build houses for Habitat for Humanity all help build team spirit and cooperation. While many companies volunteer as a team, some businesses choose a different way to encourage volunteerism — they use volunteer hours as a metric to determine the amount of money to add to their corporate giving account.
Sponsor Local Events
From softball teams to parades and awards dinners, there are always opportunities for your business to sponsor local events and activities. The payoff is goodwill and name recognition for your business.
Set Up a Donation Match Program
Donation match programs allow your employees to double their donation to causes that matter to them.
Donate With Groundswell
Groundswell makes it easy for your employees to support the causes they care about by removing friction from the donation matching model. Learn more about our philanthropy-as-a-service model and find out how your company can provide your employees with a cutting-edge benefit that will add value to your business, their lives and the community. Get in touch with us to get started.
Why Are Employee Benefits So Important? Here’s What You Should Know
No one disputes the importance of employee benefits. Employee benefits matter because they demonstrate how much the company cares about and appreciates its employees. Benefits support an employee’s health and well-being, their loved ones and even their financial literacy.
Although health care benefits top the list of the most desired, there are other perks that companies can offer that employees really want. Why are employee benefits important? They increasingly reflect changing employee priorities and the things that are most important in their lives.
According to Deloitte, salary is less important to Gen Z than to other generations. However, researchers found that just 20% of Gen Z would work for a company that did not share their values. That may be a tall order for many companies. But it doesn’t have to be so complicated.
Benefits That Actually Matter
Gen Z and millennials are looking for companies that go beyond the absolute minimum. That doesn’t mean beer-and-pizza Fridays, however. So what does it mean? For companies that want to attract the best and brightest, it means you may need to look at benefits through an entirely different lens.
Companies aren’t limited to a small selection of benefits. In addition to the ubiquitous health insurance, there are several categories of perks that will enhance your benefits package. Most of all, it’s about making responsible choices that keep in mind the communities you serve.
5 Advantages of a Great Employee Benefits Package
But first, what are the advantages of a great employee benefits package? We know that benefits matter to employees. Benefits flow to the company as well. For example, you will be better positioned to:
1. Attract and Retain Top Talent
When you value your employees, it shows in how you treat them. It’s not simply about the number of benefits, but the values that these benefits reflect.
2. Support Holistic Wellness
Employees that are mentally, physically and financially sound are better able to perform at top levels. They bring their whole selves to work each day.
3. Increase Productivity
When employees are treated well, they want to be more productive in their roles. They find ways to do more with less and they put in more time during the day.
4. Boost Engagement and Morale
Of course, employees want to be paid a fair wage. But they also want recognition and appreciation. A good benefits package signals that they are respected and that what matters to them matters to the company.
5. Improve Your Image
Good corporate citizenry along with happy employees is a combination that is unbeatable when it comes to building brand equity. Further, research says that when you treat people well, it’s reflected in how they treat customers.
Different Types of Employee Benefits
When you want to enhance your benefits package, there are many options. The benefits described below are not mandatory. Some, however, are considered standard and without them it would be difficult to attract the best employees.
Here are some of the most popular categories of benefits:
In addition to routine medical care, health care benefits may also include dental, vision and hospitalization. Many companies offer accounts that allow employees to put aside money for health care expenses that are not covered elsewhere. These include flexible spending accounts (FSA), health savings accounts (HSA) and health reimbursement accounts (HSA). The main differences between them are who contributes — employees, employers or both — and whether or not the funds roll over from year to year.
A subset of health care, wellness benefits include everything from on-site workout facilities and yoga classes to gym memberships and smoking cessation clinics. In addition, there are paid fitness apps and other wellness tools available online.
Work-life is a broad category that may overlap with some of the other groupings listed here. This benefit includes the types of perks that make it easier for working people to take paid time off to enjoy sufficient rest or tend to personal responsibilities. They include such things as vacation days, maternity and paternity leave, time off for caregiver responsibilities and, in more recent years, flexible scheduling and work-from-home opportunities.
Paid Sick Leave
While there isn’t a sick leave policy for short-term illnesses on a federal level, some states — California and New York are two — mandate paid leave for employees. Employees who lack sick leave are more likely to go to work, a major factor in the spread of infectious diseases like COVID-19, according to public health officials.
Another benefit that has become increasingly popular are “mental health days.” This may be included as part of sick days or may be separate.
According to a recent study, employees spend 25% of their workweek dealing with financial issues. These types of benefits have also experienced a surge in popularity. Bank of America reported that in 2021, 46% of employers included some form of financial wellness benefit in their employee offerings. The types of programs are wide and varied and may include retirement planning, insurance, investing, financial literacy, budgeting and tax planning.
For most Gen Zers and millennials, the defined benefit retirement plan does not exist. Of course, employers don’t have to be involved. But when employees don’t plan properly it contributes significantly to stress levels. Employers can help with 401K plans even if they don’t offer matching contributions. In addition to the aforementioned, there are planning tools, workshops and education. They can also support retirement transitions, for example, with flexible scheduling or reduced hours.
Well-trained employees are able to contribute to the company in significant ways. In addition to learning new skills, they are versed in recent trends and emerging opportunities in the industry.
Training is easier than ever before with the latest publications and options for online learning and podcasts right at your fingertips. Employers can offer tuition reimbursement, company-sponsored workshops and classes, and time off to pursue continuing education classes at a university or trade school.
Companies who care about the environment may offer an incentive to employees to take public transportation, carpool, ride bikes or walk to work. This incentive can reduce the cost of a bus ticket or provide a little extra padding in the budget each month.
Charitable Giving and Volunteerism
This is a benefit that appeals directly to employees who are looking for companies that are good corporate citizens. The benefits include, for example, matching all or a portion of charitable donations and providing time off for volunteering. Some companies sponsor a school, a local nonprofit or other charitable organization and may offer employees the opportunity to volunteer — or even manage a project — with pay.
Offer Benefits That Engage and Retain
Companies are becoming increasingly creative in the benefits they offer. The above list is not all-inclusive. However, these benefits are among the top contenders when it comes to engaging and retaining your workforce.
Why consider a charitable giving program? It allows you to be a good corporate citizen while at the same time giving employees something that’s important to them. Not everyone is interested in yoga classes or budgeting apps. But most employees have a favorite charity and the desire to do their part.
If you’re interested in a charitable giving program as part of your benefits package, contact Groundswell today. Benefits don’t have to be complicated or expensive. Employees appreciate companies that value the things that are most important to them.
Hiring, Strategy, and Leadership Tips from Groundswell Chief Product Officer Tammy Hahn
Across the world and across industries, the pandemic has disrupted everything. This includes hiring, managing, and strategizing. The so-called “Great Resignation” is underway, and companies are having to adapt on the fly.
How is Groundswell dealing with this new reality? Through people-centric solutions that benefit both management and employees. If you want to dive into the details of what that means and get some leadership tips, recently, our CPO Tammy Hahn appeared as a guest on The Product Management Leaders podcast. Here are some highlights, where Tammy discussed how evidence, conviction, and tenacity can help organizations thrive.
The Power of Generalists
Legacy hiring and recruiting strategies are not working. Even as employers increase salaries at the quickest rate in nearly 40 years, positions remain vacant. What does this tell us? Monetary compensation is not everything. Recruiters must understand what motivates modern employees to create appealing job postings and offers. The best move of all is to hire people who share your company’s values. This is the approach we take at Groundswell:
“I’m looking for people that can flex: people that are generalists who aren’t afraid to go high-level as well as get into the nitty gritty. At Groundswell, there is no product yet, so you don’t have any metrics to fall back on to have a hypothesis in terms of what will optimize a certain flow— the flow doesn’t even exist. You need to navigate the unproven and ambiguous to earn the right to optimize.”
Here at Groundswell, we are still in the early stages of determining our core flow and the value we bring to our users and clients. This requires a very specialized approach to hiring, where we bring in people who are comfortable being creative and adaptive, and working from a blank slate.
Leading Products Vs. Leading People
Every business owner and executive has a unique set of experiences and ideas on the approach and characteristics of effective leadership. In the podcast, Tammy shared one of her leadership tips: not every situation demands the same type of leadership approach. Excellent leaders adapt to their environments and empower their teams. During the course of the podcast, she had some great insights into the differences between leading products and leading people:
“Not everyone is meant to be a great people-leader. As you move up the career path of a people leader, especially in a larger organization, the further away you move from actual product management… In fact, if you want to go up that people leader path, it’s more about coaching, communication, and project management than it is about designing and building the product. Leading people is different from leading product definition and execution.”
Being an excellent leader demands constant commitment, management, and the development of a team that is competent and results-oriented. There can be no true leadership without team management. On the people management side, Tammy explored how important it is for managers to approach failure in the right way:
“I don’t like to call failure “failure.” I like to call it a misstep. What matters is what you learn from that misstep, not so much the failure itself. It’s a learning process. I only consider it a failure if you fail to learn, and you repeat that mistake over and over again. Great product leaders build a culture of curiosity and calculated risk-taking without the fear of repercussions if hypotheses prove false.”
This jives perfectly with the Groundswell approach, where we frequently hold pre-mortem sessions to grasp all the things that can go wrong ahead of time. Becoming a successful leader necessitates ongoing personal and professional growth, regular and open team feedback, and response on feedback received.
Product Strategy: Knowing When To Keep, Pivot, or Kill
A product strategy is a company’s strategic goal for its product lines, outlining where the products are heading, how they will get there, and why they will thrive. Instead of striving to include everyone and every feature, a product marketing strategy concentrates on a specified customer base and functionalities. As a CPO, Tammy discussed, one of the challenges here is prioritization:
“Prioritization is always hard. Every stakeholder is always demanding something from a product manager. It’s really, really hard. It’s all about starting out with the right objectives upfront. The way that I operate as a leader is to align on your objective, collaborate on the strategy and then execute the tactics. Beautiful things happen when everyone on the team is aligned on the objectives and has a voice on the strategy.”
Goals are essential for focusing on and working towards. To make them viable and get the most out of the goal-setting process, we believe it’s a good idea to track your progress and evaluate your progress on a daily basis. Another important leadership tip is to have clear company goals:
- Is it to expand or to keep our current customers?
- Is it simply to boost our brands? If so, what is the plan of action?
- If we want to expand, will we enter a new market, enter a new vertical, or broaden our product offering?
Once you know the goals, you can move into strategy. And in the early stages, Tammy said, that it is a good idea to start with metrics:
“The product growth graph peaks at a certain point then declines. That’s when you know you need to deprecate said product. I would really try to understand the metrics, what does growth look like from a usage adoption perspective, as well as from a business sales perspective.”
CPOs can use product data and analytics to forecast consumer behavior, improve decision-making, discover market trends, and calculate the ROI of marketing campaigns. The clearer your vision of your clients, the easier it will be to approach them:
“Product is a leading indicator; sales and revenue are lagging indicators. What are some predictions that you’re heading towards your peak? It’s not growth, from a business metric standpoint; it’s growth or adoption and usage of your product. As a leader, you may need to make the hard choice of investing less in plateau-ed products that are still generating revenue.”
Advice for CPOs
Tammy offered many leadership tips on the podcast; one of the most important takeaways was that leaders and managers have the most influence over the people they lead and supervise. They are in charge of ensuring the success of their department, and they are crucial in shaping company culture. Tammy is a big part of our leadership-management team. She ended the podcast with some leadership tips and advice for aspiring CPOs:
“Know your objectives, stand your ground and have the data to back you up on why you’re choosing to make your decisions. I think the worst thing that you can do is to be too agreeable for the sake of being agreeable and getting people to like your decisions.”
Tammy also said that it is okay to have a different opinion:
“You have to be okay with the fact that not everybody’s going to like your decision. You need to have the conviction and data to back up why you’re making those hard choices so that your team is able to focus. Get your evidence, have conviction on what you want to focus on, and stick to your guns. A great product leader provides focus on what the teams are working on, and more importantly, making it clear across the organization what the teams will not be working on.”
Thanks to the The Product Management Leaders podcast for hosting our CPO! We love spreading the word.
To see the Groundswell product first-hand at our beta launch, sign up for our email list here.
Our Founder in Forbes on Rethinking Corporate Donation Matching
We always love to share the Groundswell philosophy with the wider world whenever we can.
Just recently, our CEO Jake Wood shared his insights over at Forbes, talking about why organizations should rethink their corporate social responsibility (CSR) strategies and programs – and how, with this corporate philanthropy overhaul, they can establish a more cohesive relationship with their employees and nonprofit organizations.
Here are some of the highlights from the article:
Corporate Charity Should Represent the Passions of the Employees
Traditionally, corporate giving efforts are driven by a handful of executives or corporate foundations. The efforts are often disconnected from the company and the employees that are supposed to be represented by the program. This, Jake explained at Forbes, results in an ivory tower situation.
“In its best form, corporate philanthropy is loosely aligned to a company’s values, but often not to those of the company’s employees. In its worst form, it simply serves as a CEO vanity project.”
What corporate entities need to realize is that their employees have diverse perspectives and backgrounds. Some, if not all, of them want to find a higher purpose for the work that they do. Unfortunately, traditional CSR programs don’t often reflect that.
Most Nonprofits Don’t Get the Support They Should Be Getting
Jake also pointed out how the current system for corporate donations excludes some nonprofits.
“If employees who want to give feel left out by their corporation’s donation strategy, it’s even worse for the nonprofits meant to benefit from those matching programs. While the top 1% of nonprofits might have cracked the code, most have trouble getting in the door.”
There are a couple of challenges that nonprofits face, even for those who’ve already gotten their foot through the door.
- Nonprofits led by historically marginalized individuals or communities often find it difficult to even get the attention of executives or foundation staff.
- Even when they’ve been qualified and chosen, most nonprofits still need to go through a lot of processes before they can receive funds, which can either take a long time, or end up with the funds being undispersed.
Jake shares his experience as the CEO of the disaster-relief nonprofit Team Rubicon:
“I once received an email from a major Fortune 500 company eight months after a donation by an employee (in the prior year no less!). The email asked me to confirm receipt of the $75 donation and then to log into an obscure portal to upload proof of receipt so the company’s matching donation could be processed. What a hassle.”
Nonprofits end up chasing donations that are owed to them because of this inefficient processing, instead of focusing on delivering impact to the communities they serve.
Traditional Philanthropy = Low Employee Engagement
Employees are not as engaged in traditional, centralized philanthropy because this CSR can’t please everyone. Your ivory-tower philanthropy may please one or two people, but it will probably not resonate with everyone.
Plus, the systemic approach to giving that companies do doesn’t often result in massive impact and changes. This can lead to employees seeing these efforts as lacking or unapproachable.
Jake points to homelessness as an example:
“Solving homelessness at a macro level requires systemic solutions and massive policy changes, both of which could take years, if not decades. But employees riding to work on the subway care less about systemic solutions and more about ensuring that the human being sleeping on a piece of cardboard near the turnstile they step over each morning has a bed that evening.”
Decentralizing philanthropy would go a long way to achieving that. Sure, systemic changes are necessary, but making employees the “agents of change” in this regard can make them feel that their company’s philanthropy efforts are indeed going somewhere beneficial.
How Companies Can Decentralize Corporate Giving
Jake shared with Forbes the key steps to how companies can decentralize their philanthropy efforts:
- Provide a charitable giving stipend to each employee that they can direct to a charity of their choice on an annual basis.
- Have employees vote on a slate of charities chosen by leaders to determine which cause gets the company’s contribution.
- Empower business resource groups, which are typically aligned around specific diversity elements, to make recommendations on charitable giving related to their interests.
With these steps, companies can generate meaningful impact in their communities through their employees.
To read Jake’s full article, click here. Or if you want to learn how you can start changing your approach to corporate giving, talk to us here. Here at Groundswell, we help you give better.