Corporate Philanthropy + Employee Retention: The Connection
Did you know that 71% of surveyed employees stated that it’s very important to work at a company that supports giving to and volunteering with nonprofit causes?
Or that 77% of millennials reported a sense of purpose as part of the reason they selected their current employer?
Or that employees who engage with corporate giving programs tend to have 75% longer tenures with the company?
Or that 55% of employees would even take a lower salary in order to work for a socially responsible company?
These facts—and more—help demonstrate the powerful internal benefits that corporate philanthropy and CSR can have on a business. And when it comes to corporate philanthropy and employee retention, the impact is substantial.
In this guide, we’ll provide companies with everything there is to know about corporate giving, staff retention, and the overlap of the two key concepts. If you’re looking to better engage your employees and keep them around for as long as possible, let’s dive in with the following topics:
- An Overview of Corporate Philanthropy
- What To Know About Employee Retention
- The Overlap Between Philanthropy + Staff Retention
- Tips for Driving Corporate Philanthropy + Employee Retention
Effective corporate philanthropy initiatives and high levels of employee retention year over year can each play significant roles in a company’s overall success. But many business owners fail to realize that the two ideas actually go hand in hand!
An Overview of Corporate Philanthropy
Corporate philanthropy is a key component of CSR (or corporate social responsibility), in which businesses dedicate time, money, and resources to promote the welfare of others. This often occurs through charitable donations to nonprofit organizations looking to drive a particular mission forward. Some of the most common examples of corporate philanthropy offerings are community grants, matching gifts, team volunteerism, event sponsorships, and more.
Thousands of businesses opt to partake in corporate philanthropy in one form or another, in no small part due to the substantial benefits that participating companies see. These advantages include—but are not limited to—an improved brand image, increased marketing opportunities and sales, heightened levels of team member engagement, attraction of new candidates, and (of course) elevated rates of employee retention.
What To Know About Employee Retention
Every company wants to have high levels of employee retention. Not only is it more cost-effective to maintain the same high-performing team members year after year, but it also demonstrates a positive work environment that will be attractive to new potential employees as well. This will enable your business to onboard more top team members who will, ideally, also stay at the job for years to come.
And it all comes down to this: employees who are highly engaged in their roles are more likely to be retained at a business for longer periods. Not to mention, you’ll require less time and energy devoted to hiring and onboarding new individuals, develop an inviting employee culture, and see higher levels of productivity among team members.
The Overlap Between Philanthropy + Staff Retention
Companies tend to see a significant positive correlation between investments in corporate philanthropy and employee retention results.
But why? It’s simple: corporate philanthropy initiatives lead to higher levels of employee engagement. High levels of engagement lead to lengthened employee tenures at the business.
This is because people (especially those of younger generations) like working for companies that promote social good. In fact, 54% of employees who are proud of their company’s contributions to society report being engaged in the workplace. As a result, these individuals are significantly less likely to leave their employers.
Tips for Driving Corporate Philanthropy + Employee Retention
Ready to see these benefits for your own team? Check out our top three tried-and-true practices for companies looking to increase philanthropy and retention:
1. Enable employees to play a significant role in your company’s giving.
Giving to any nonprofit will have a number of benefits to your business and its team. But when you allow employees to play a hands-on role in your corporate philanthropy initiatives and decisions, you’ll receive multiple times the impact on your engagement and retention strategies.
And that’s where workplace giving comes in!
Workplace giving is a particular form of corporate philanthropy where individual employees are encouraged to take the driver’s seat in their employers’ philanthropic initiatives. In these programs, team members are able to direct the company’s dollars toward their favorite nonprofit causes. For example, matching gifts and volunteer grants are offered when a company provides additional support to organizations that their employees are already supporting, whether through time or dollars.
With workplace giving and other employee-led programs, employees have a larger say in the businesses’ overall CSR and can feel the impacts of their employers’ giving on a more personal scale.
2. Provide many ways for employees to participate in philanthropic efforts.
Corporate philanthropy—and even workplace giving—is not a one-size-fits-all solution for employee retention or overall CSR. There are tons of powerful ideas for companies and their employees to get involved.
A few of our favorite ways for companies and their employees to participate in philanthropy include:
- Matching gifts
- Individual volunteer grants
- Team volunteer grants
- Group volunteer opportunities
- Payroll deductions
- Cause marketing campaigns
- Employee giving stipends
In addition, the more you simplify involvement with your company’s giving programs, the higher levels of participation, engagement, and retention you’ll likely see. For example, one of the most important factors for providing employees with an optimized giving experience is the requirements of eligible contributions.
If you’re matching employee donations, it’s a good idea to match all kinds of donations—such as website, in-person, direct mail, text, and peer-to-peer gifts. The more involvement options you provide, the more likely an individual is to get their gift matched.
Keep in mind that not every employee will want to engage with nonprofit causes in the same way. For some, matching gifts are an amazing opportunity—especially if an individual already gives to a qualifying organization.
On the other hand, some employees will prefer to assist nonprofits with their time instead. For these team members, volunteerism-based initiatives such as group volunteer events and dollars for doers grants will have a larger impact on their likelihood of participating and overall engagement levels.
3. Effectively communicate the impact of your philanthropy to employees.
Beyond simplifying the process, one of the best ways to drive employee participation (and increase the benefits of your efforts) is to focus on the positive impact that your philanthropy has on the world.
Here are a few common ways that companies can do so:
- Previous Giving Statistics: Picture this—Company A is looking to utilize its philanthropic success in the previous year in order to drive the current year’s giving initiatives. In 2021, Company A donated more than $2 million to mission-driven nonprofits between individual contributions and company matches. This included donations to over 150 nonprofit causes, serving organizations in education, arts and culture, health and human services, environmental sectors, and more. The company decides to highlight these facts and communicate to employees that their participation in the program can make a difference toward total success.
- Mission Impact: Partaking in a workplace giving program enables individuals to make a larger impact on a cause that they care about. Companies looking to drive participation in matching gift programs, for example, can highlight that an employee’s gift has the potential to do twice as much for the organization’s mission. For example, instead of feeding 10 families for a month with their generous contribution, a donor is able to leverage their company match to feed 20 families or more.
And these don’t have to be solely internal strategies, either. Prioritizing your company’s philanthropic impact can be a great way to drive team-wide engagement in the programs and, thus, increase retention rates. But these same ideas can also be used to elevate your brand in the public eye as well.
Without an effective strategy in place to communicate the value of your company’s giving initiatives, on the other hand, your team is not likely to receive the greatest benefits possible. Your philanthropy won’t keep employees at your company if nobody—team members included—know about the efforts.
The more a company participates in corporate giving initiatives, the higher the level of pride employees have in the business, and the more its employees will be engaged in their role. Each of these ultimately leads to significantly higher rates of retention, which, in turn, enables the corporation to invest more into its philanthropic efforts.
So if you’ve been looking for new ways to keep your high-performing employees with the business for longer, getting started with corporate philanthropy might be just what you’re looking for. Good luck!
Learn more about the benefits of corporate philanthropy and how to get involved with these other company-specific educational resources:
- Why Workplace Giving Matters for Nonprofits + Companies. Workplace giving is a form of corporate philanthropy that is highly favored by businesses, employees, and nonprofits alike. Find out how matching gifts, volunteer grants, and more can benefit your team.
- How to Offer the Ultimate Employee Giving Experience. In order to drive employee participation, engagement, and retention through your giving initiatives, make sure the experience is a positive one for your team. Learn more about how to do so with this informative guide.
- Top 20 Matching Gift Companies: Leaders in Philanthropy. Looking to be inspired by some of the most charitable-minded businesses in the corporate giving space? Check out this list of top companies leading successful matching gift programs, and seek inspiration from the experts!