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Give Wisely and We All Receive the Benefits

“I think I can, I think I can, I think I can!”

You all know this story from your childhood, right? The seemingly incapable little blue engine surprisingly pulls the very large train over the mountain to its destination when no one else would do it. It’s a tale designed to inspire optimism and hard work in children. When I think about the realities of corporate philanthropy in San Diego and the nonprofits they support, I find this a very fitting metaphor.

The seemingly impossible but oh-so-important task for corporate philanthropy is to find optimal ways to invest limited company resources (dollars, talent, time, expertise) to support a highly challenged social sector and to also have those investments make business sense. Most companies in our region are small to medium size, and there are a limited number of corporate foundations and giving programs. So it is even more important for all members of our business community to make the most of what they have to contribute.

Often a company’s philanthropic activities also have to satisfy the varying expectations of multiple stakeholders: executives, employees, shareholders, customers and the public. In some cases, there is a clear connection between corporate philanthropy and the value to one or more of these stakeholders. In other cases, however, the activities risk being criticized as a waste of profit or for not making any strategic contribution to the firm.

Companies must demonstrate and measure the value of their giving both internally and externally. As noted in a recent report for The Conference Board, “Corporate philanthropy programs can improve social welfare, but some financial return from these programs is essential for corporate giving to continue in the long run. Officers and directors should not treat charitable giving as a peripheral activity or an after-the-fact distribution of profits. The evidence shows that…corporate contributions can indeed be good for both company performance and society.”

Over the last year, the buzz in corporate philanthropy has been about putting the full value of the business to work on behalf of the community, beyond writing checks or supporting employee volunteer activities. An influential article that speaks to this point is “Creating Shared Value,” written by the thought leaders at FSG Social Impact Consultants and published in the Harvard Business Review in January. A report by the Committee Encouraging Corporate Philanthropy and Accenture published in June similarly recommends five tenets of “sustainable value creation:”

Recognize the opportunity. Uncover societal problems that if addressed may lead to new sources of competitive advantage.

Recalibrate your radar. Pick the strategy that is right for the company and for society; find a fit between what you do and a cause.

Research, develop, and repeat. Have some tolerance for failure. Be ready to engage in new ways of thinking, new coalitions and partnerships.

Rewire the organization. Philanthropy with impact takes patience. Problems will not get solved this quarter — or next.

Reinforce the value. CEOs help set the pace and should be open to dialogue with stakeholders about whether the strategy is working.

Giving It Their All

Like the little engine’s climb up the mountain, this approach to giving back is hard work. But the good news is that there are others dealing with the same issues from whom you can learn. San Diego Grantmakers (SDG) is a membership association here to help philanthropic organizations be more effective with their giving. One of the ways we do this is by connecting grant-makers of similar types or funding interests to one another. Whether you need help making the business case internally, establishing processes for your philanthropy or measuring your impact, SDG and your colleagues in corporate philanthropy are ready, willing and able to assist.

I would like to recognize the outstanding leadership of our current board of directors including Chair and Union Bank Foundation Vice President, Foundation Officer Kathy Patoff as well as the contributions of our Chair Elect and Hitachi Foundation Senior Program Officer Renata Hron Gomez. I also commend the San Diego Business Journal for once again publishing the Corporate Philanthropy Report, and praise the great companies and nonprofits doing heroic work on behalf of our community members every day.

Nancy Jamison is executive director of San Diego Grantmakers. Contact her at nancy@sdgrantmakers.org

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