The Business Case For Corporate Philanthropy

Research released today shows donation to be a better financial choice than either liquidation or landfill when it comes to unloading product that cannot be moved otherwise. 

Economists Justin Ross and Kellie McGiverin-Bohan's paper, The Business Case for Product Philanthropy, includes two worksheets companies can use to determine for themselves: (1) Cost-Benefit Analysis of Liquidate, Dispose, or Donate, and (2) Return on Investment (ROI).

The authors highlight enhanced tax deductions and show how nonprofit organizations stand ready to mitigate costs associated with donating. 

The benefits don’t stop in the CFO’s office: corporate charitable activities help companies recruit, engage, and retain employees, and attract customers and investors. High-profile donation efforts have helped more than one company build a social movement around their brand.

The world leader in product philanthropy, Good360, commissioned the research. Good360 is ranked one of the 10 most efficient charities by Forbes, and over the last 28 years they delivered more than $7 billion of donated products to tens of thousands of nonprofits and schools.

Every nonprofit can access Good360's website to and search for product they need. All they have to do is register with their EIN number (Good360 will even look up your EIN if you don't know it). Then they can browse products donated by The Home Depot, Mattel, 3M, Hallmark, Bed Bath & Beyond, Crayola, Sears, Walmart, Life is Good, Kimberly-Clark, and many, many others.

“We challenge ourselves to continually look for ways to use excess product and manufacturing waste," says Carol Hallquist, VP of the Hallmark Corporate Foundation, Sustainability, Diversity & Inclusion, about the participation of Hallmark Cards. "For example, manufacturing scrap is used by children at our Kaleidoscope creative experience to make art projects." 

“Our excess greeting cards are given to the Salvation Army for their prison ministry program so inmates can communicate with their families. The recidivism rate is significantly lower for those involved in the program. Our excess recordable storybooks are given to military personnel overseas, so their children can hear their voices at bedtime. And our excess party ware plates and napkins were used to serve food to families left homeless by the Joplin tornado last year.”

Good360 CEO Cindy Hallberlin is a dynamo with a mission. She has a history of successfully tackling really tough business challenges. As the chief ethics and compliance officer following a $1 billion fraud, she oversaw the cultural transformation of U.S. Foodservice. Before that she developed and successfully managed the U.S. Postal Service’s REDRESS employment mediation program, which successfully resolved more than 80 percent of discrimination claims, resulted in $60 million in cost avoidance, and took the term “going postal” out of common parlance.

“We do more than match givers with nonprofits," says Hallberlin. "We set up innovative employee giving programs. A good example is the program we developed and manage at Hewlett Packard (HP)."

For HP, Good360 set up the entire website, manages the back end, and oversees logistics on the donations. HP determines how much it wants to give, and the match arrangement with their employees. The internal website Good360 developed lets employees select what they want their donation to be, who they want to give it to, and make the donation. The site stays active until the matching amount by HP runs out. 

“It’s a win-win-win," says Hallberlin. "HP provides a fantastic service to its employees and non-profits, employees get to determine who their gifts go to, and the nonprofits get the gifts. It really is amazing.” 

Seth Kahan (Seth@VisionaryLeadership.com) is a Change Leadership specialist. He has consulted with CEOs and executives in over 50 world-class organizations that include Shell, World Bank, Peace Corps, Marriott, Prudential, American Society of Association Executives, International Bridge Tunnel and Turnpike Association, Project Management Institute, and NASA. His book, Getting Change Right: How Leaders Transform Organizations from the Inside Out, is a Washington Post bestseller. Visit GettingChangeRight.com for more info and a free excerpt. Follow Seth on Twitter. Learn more about Seth's work at VisionaryLeadership.com

[Image: Flickr user Salesforce.com Foundation]

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