Boston Business Journal
Volume 20, Number 43
by Alan E. Lewis, Chairman, Grand Circle Corporation
A recent report by the Catalogue of Philanthropy puts Massachusetts' taxpayers at the very bottom in terms of individual giving.
While our corporations do better—ranking 14th nationally, according to the Foundation Center in Washington, D.C.—critics have pointed out that in a state with the third highest per-capita income, individuals and businesses alike are falling far short of what they should be doing.
Much of the criticism targets entrepreneurial companies and so-called "dot-com millionaires." In my opinion, philanthropy should be part of the entrepreneur's vision from the beginning, but the commitment needs to grow as the company does.
One of the most philanthropic things a company can do in its first five years is to grow and thrive. It should get established and create jobs. Once a company has sturdy underpinnings, then more limited philanthropic efforts should become a comprehensive, long-term strategy that makes giving back an integral part of the business enterprise.
This move from individual vision to corporate reality can be difficult. I have seen many young companies struggle while earnest in their desire to be philanthropic. This is where more mature companies can and should play an invaluable role. We can demonstrate by both advice and example how young companies can develop an authentic giving program that is more than mere marketing.
To be most effective, philanthropy needs to be strategic. This means that your charitable contributions should serve the long-term best interests of your company. How you define those interests, of course, is key. Many companies feel that by contributing to an organization that serves their target markets, they may project a more favorable image to current or prospective customers and improve financial performance. I would argue that such "cause marketing" is quite different from true philanthropy.
I believe that a company's philanthropic commitment should focus on causes that hold genuine meaning for the company and its employees and express the values that spring from the heart and soul of your enterprise. Supporting organizations and programs that intrinsically mean something to you will encourage you to stick with them over the long haul, and thereby, have the best shot at doing the most good.
The overall notion of philanthropy needs to become part of a company's corporate culture. An effective way to do that, we've found, is not only to encourage employees to volunteer their time to the organizations we support, but also to tell us what causes they want us to support in the first place. By doing this, all are involved with a mission much larger than the business enterprise. This kind of philanthropic commitment helps attract and retain good employees, which is especially important in today's tight labor market.
I also believe it is wise to extend your philanthropy into every corner that your business touches, not just your home base. As a travel company, we support organizations in the destinations where we take our customers. It helps make us more welcome in the communities we visit, and seeing these projects enriches our travelers.
Perhaps more important is to understand that corporate philanthropy should create mutually beneficial strategic partnerships. Your efforts will have maximum benefit when you and the organizations you support understand each other. Bringing representatives from your beneficiaries together with you in a community advisory group or similar forum will help your company learn how to apply philanthropy most effectively, while helping your philanthropic partners secure the most useful resources. Such a forum also encourages nonprofits to learn from one another. And it enables you to provide advice and skill sets that nonprofits may need as badly as funding.
There are countless organizations and programs that are worthy of support. But simply writing a check is not the answer. Companies need to make philanthropy a part of their day-to-day business. They need to ensure that their contributions resonate with their employees. And they need to learn how best to serve as a supportive partner in what should become a long-term relationship.
The corporations and entrepreneurs that have established successful philanthropic programs owe it to their younger counterparts to share the lessons we have learned. Just as we help the deserving nonprofit, so we must offer leadership and support to fellow businesses seeking to get fledgling philanthropic programs off the ground. Going beyond marketing to true philanthropy has only one prerequisite, and that, beginning at the top and extending through all levels of your organization, is the willingness and the commitment to try.