I’m the executive director of a charity in a small city of about 65,000 people. How do I get local and national businesses to make donations?

Unfortunately, what you are asking is often easier said than done. While it’s important to remember that the majority of private sector funds comes from individuals, this article will help you understand corporate and business supporters. Hopefully that will strengthen your strategy with them as a source of funds but remember to diversify your fundraising by approaching as many sources as possible.

In 1996, Andre Picard was the Atkinson Fellow. His work was named A Call to Alms: The Voluntary Sector in an Age of Cutbacks. I followed his research closely that year and among other things, recorded this statistic because I found it so shocking! “Fewer than 5% of companies report charitable contributions to Revenue Canada and more than half the 3,200 Canadian corporations with assets of more that $25 million do not give a penny to charity.”

A 2003 article in McLean’s magazine (rather dismally) stated: “Only 3% of Canadian businesses claimed charitable donations on their tax returns in 2003, for a total of $1 billion in donations (representing less than 1% of the companies’ pre-tax profits), according to Imagine Canada. While those figures don’t represent all the charitable work companies do (like volunteer work by employees on company time), only 20 per cent of charities and non-profits in Canada received corporate donations and grants in 2003, and the vast majority of corporate giving went to a small group of organizations with the biggest revenues.”

According to the Community Foundations of Canada website, they cited, “a new report released by the Conference Board of Canada finds that companies are aligning their philanthropy programs to meet overall business objectives and corporate reputation and branding needs. More than a third of the 77 multinational companies participating in the study said that the biggest challenge they will face in managing their corporate contributions programs in 2006 is the measurement of results and outcomes. It further finds that forty-two percent of survey participants listed diversity as the program area that will be more important in 2006, while 31 percent listed alumni giving as becoming less important.”

So what’s the bottom line? Business is driven by its bottom line and beholden to its shareholders…neither of which are very conducive to giving away their profits to needy causes unless that’s one of their stated values. Despite our expectations that Corporate Canada should set a good philanthropic example (particularly prior to the pre-2008-economic bust) the reality is that individuals give away much more toward charitable work than businesses and foundations put together.

Thankfully, we do have Imagine Canada’s Caring Companies as role models. My quick attempt to identify the number of corporations we have in Canada was to no avail (aside from the above reference in 1996 that there were 3,200 Canadian corporations with assets of more than $25 million.) If there are currently only 118 “Caring Companies” in this entire country it’s certainly a fraction of the potential. However, as long as we (consumers) give business to companies with debatable values and practises or sense of corporate social responsibilities (CSR), what’s motivating any of them to act differently? If their current behaviour continues to enhance their bottom line, they are not apt to change.

In a previous life (more than three decades ago) I worked for the Royal Bank of Canada. As an “RBC alumna” I have always followed their philanthropic activities and been pleased with the leadership role they have taken in the charitable sector, through their investments and employee engagement. I recall one strategy I used many years ago while serving on the board of a local symphony orchestra. In my request to sponsor our 25th anniversary, I spoke to their interests by boasting that more than 40% of our subscribers paid with their Royal Bank Visa card. I was instantly granted my requested amount which in fundraisers’ hindsight is a clear indication that I didn’t ask for enough! However, both the charity and the donor were happy so all is well that ends well.

Types of Corporate/Business Support

The business community can help charities in a variety of ways. Part of our job is to help them understand that it’s not just cash that can make a difference. They can:

• Make an outright donation (out of their philanthropic budget…if they have one);
• Offer the expertise of a corporate executive or support of an employee (this could happen in a variety of forms or a combination thereof: [1] the direct secondment of a senior executive for a stated period of time; [2]”blessing” by the employer to underwrite volunteer time invested…this could also include allowing phone-meetings on their toll-free lines; [3]encouraging staff to volunteer their timeserving on a charity’s board of directors; [4] employee groups identifying a chosen charity to “adopt” for a given period);
• Provide a sponsorship (usually out of a marketing budget with a very clear expectation of return on their investment and possibly a signed contract that outlines “the exchange”…do not kid yourself…the higher the financial commitment, the larger the stakes…don’t sell your soul without seeking legal counsel);
• Support your organization with a “gift-in-kind” of a product they manufacture or supply.

 

What is my best approach?

I can never say it enough! Linkage – Ability – Interest are the necessary prerequisites to strategic prospect research and therefore, increasing your chances of securing a gift. It doesn’t matter if we’re talking about Corporate Canada or the Mom & Pop Shop on Main Street. People give to people…particularly those they know…and trust!

The goal of any business is to grow its bottom line and provide a viable return on investment to its shareholders. We need to answer what’s in it for them to support your charity? Corporate or business fundraising is the most challenging of all sources because they are not driven by philanthropic acts…unlike charitable foundations whose purpose is to give away money or individuals who have discretionary income and based on their unique values, can be compelled to invest significant amounts.

Since the advent of the World Wide Web it’s become much easier to research corporate prospects. Go to their website and if you don’t find a “donations” section try looking for “community interests, involvement or investments” and read up on their values and types of support. If you have an inside contact, that’s even better. Capitalize on your linkages when you have them and ask questions that will help you understand the corporation’s motivations.

Your research is important to increase your chances of support and be responsive to the prospective donor. However, it doesn’t guarantee funding so remember – provided there is a “good fit” between your charity and the business – a refusal is just the beginning. Don’t give up. Thank the prospect and keep their priorities in mind for the future as you build compelling cases for support (that meet your organization’s strategic directions). You might also like to include them in Newsletters that keep your donors informed of the charity’s good works.

Where corporate Canada meets small business is in the area of frequent requests for support. Living in a city of 65,000 suggests that you probably have more access to the latter than the former. Regardless, what we call “donor fatigue” in the profession also translates to “prospect fatigue”. For those businesses who support their communities, many will say they get overwhelmed by the number of requests they get.

Ask local businesses how best to involve them in your work. For instance, a gift shop may not have the ability to give a cash donation but could take a stock item and give it to your charity for an auction. Keep asking yourself, what’s in it for them? Small businesses and sole proprietorships may have very limited funds but with adequate recognition, they may see the benefit of supporting your cause. Focus on relationship building. This isn’t a quick fix…it takes time and effort but by engaging your potential donors, you increase your chances of success.

For more information see:

Tips for Corporate Fundraising

Cynthia Armour is a freelance specialist in fundraising and governance. A Certified FundRaising Executive (CFRE) since 1995, she volunteers as a subject matter expert with CFRE International. She works with boards and senior staff to ensure that strong leadership will enhance organizational capacity to govern and fundraise effectively. Contact Cynthia directly at 705-799-0636, e-mail answers@elderstone.ca, or visit www.elderstone.ca for more information about her services.

To submit a question for a future column, or to comment on a previous one, please contact editor@charityvillage.com. No identifying information will appear in this column.

Disclaimer: Advice and recommendations are based on limited information provided and should be used as a guideline only. Neither the author nor CharityVillage.com make any warranty, express or implied, or assume any legal liability for accuracy, completeness, or usefulness of any information provided in whole or in part within this article.

Please note: While we ensure that all links and e-mail addresses are accurate at their publishing date, the quick-changing nature of the web means that some links to other web sites and e-mail addresses may no longer be accurate.