Here’s Why Philanthropy Shouldn’t be Perceived as a Business Cost
Here Rebecca Constable, Head of Philanthropy at Kleinwort Hambros, talks to CEO Today about the growing appetite for philanthropy and impact investing amongst entrepreneurs.
The age of austerity and the rise of so-called ‘compassion fatigue’ might suggest charities are finding it harder to attract meaningful donations. But among entrepreneurs at least, philanthropy seems to be alive and well.
Over the last decade, we have seen an upward trend in the number of businesses that are embracing social causes as a way of benefiting both the charities they support and themselves.
The climate of charitable giving is changing with charities being run more commercially than perhaps they were in the past. This is appealing to today’s business owners who want to have more of a direct involvement in their chosen causes and can see the impact of their investment, both financially and also through sharing business best practice.
Certainly we are seeing a shift in the way business owners look at philanthropy. Beyond the benefits for charity and wider society, it is now widely recognised that such donations can provide a boost for the business itself.
In our experience, business owner clients no longer regard charitable donations, as well as volunteering, citizenship and wider Corporate Social Responsibility (CSR) programmes, as merely a cost to the business. Instead they see it as an important part of business culture. They recognise that it offers significant benefits that are far wider than purely supporting a given charitable cause. It increases companies’ visibility, builds brands, helps to attract new employees, and aids staff engagement.
Supporting employees to volunteer, fundraise and get involved in their communities, increases staff morale, enhances skills and confidence and can build stronger working relationships not only across the organization but also with business contacts. We know that employees prefer working for businesses that are active in the local community.
The benefit to companies is not just from within, when faced with a choice between two companies that offered products and services for the same price, a significant proportion of our clients said that their decision would be affected if the corporate culture involved engaging with charities and the local community.
At Kleinwort Hambros we reap the benefits of being able to offer staff a range of volunteering activities with local charities, which all serve to enhance staff engagement and ensure we have a positive impact on the communities in which we are based. Indeed, a recent staff survey to demonstrate the impact of CSR revealed that 75% of those who responded developed their teamwork and relationship building skills, 64% enhanced their communication skills, and 74% reported that it increased their sense of wellbeing and happiness.
The benefits of volunteering and citizenship programmes are becoming more significant as part of wider corporate culture, and larger employers are increasingly seeing the benefit of analysing and publishing data to demonstrate the business benefits of broader Corporate Social Responsibility. However there is always more to do and more to improve, and larger corporates can learn lessons from the entrepreneurial, small and medium sized businesses and the private sector in this area.