There's nothing like a disaster to bring out the best in people. As cynical as that sounds, the earthquake that struck Haiti last week has resulted in an outpouring of contributions to nonprofit groups to rescue those trapped under rubble and aid survivors. Many of these funds have come from big U.S. businesses, according to a recent tally by 24/7 Wall St.Morgan Stanley (MS), J.P. Morgan Chase (JPM), Bank of America (BAC) and Goldman Sachs Group (GS), for example, each have pledged $1 million to relief efforts. Of course, these financial powerhouses are some of the same ones currently held in high disdain by many Americans following the recent mortgage meltdown and controversies over bonuses paid to employees after receiving taxpayer bailout funds.
Those banks and others have much work to do to repair their images, and corporate giving in its various forms can go a long way to furthering that aim. Indeed, one of the most important roles corporate philanthropy plays is to show consumers that companies can be good citizens, according to a report by McKinsey Quarterly.
Such efforts don't go unnoticed by consumers, says Alisa Kesten, executive director of the Volunteer Center of the United Way, based in Tarrytown, N.Y. "They like it when they see that (a business) is supporting an important cause or organization." That perhaps is never so true as when crises strike, and likely the reason corporate giving didn't ebb amid the recent economic downturn, even as corporate profits were devastated. In fact, a recent report shows that companies gave more in 2008 than in the previous year, according to a survey by the Committee Encouraging Corporate Philanthropy. Of Fortune 100 firms, 60% increased giving "despite sustaining greater profit declines (than) their non-Fortune 100 peers," the committee found.
Another goal of corporate giving to is build leadership skills among workers and boost training and recruitment by involving employees in local projects, according to McKinsey Quarterly. Businesses with dedicated philanthropic programs believe they have a social responsibility to the communities in which they do business, and where their employees work and live. Corporate giving can also help build common bonds among employees who volunteer time or money for community projects as part of their company's outreach efforts.
In recent years, companies have taken advantage of the Martin Luther King Jr. holiday, with its theme of community service, to encourage employees to donate time toward community service. And that involvement is needed never more so than today, Kesten says. Nonprofits across the country have been inundated with calls by those in need, straining programs and budgets. Whether help is "in the form of employees who are volunteering or corporations who are making direct donations or sponsoring programs," she says, "it's just vitally important."
Of course, with Haiti's plight in the forefront of so many minds, people are eager to find a way to help the people of that impoverished country in any way that they can. In weeks and months to come Kesten expects her organization will be coordinating local efforts to provide more services to the stricken nation. But with rescue efforts still ongoing in Haiti, Kesten says, "the best way that people can help is by contributing money."
People at Work: Corporate Giving Boosts Image, Employee Involvement