July 25, 2019
The below op-ed appeared on the Business blog of COMMERCE magazine. Thanks to the Commerce & Industry Association of New Jersey for sharing.
To understand one of the newest trends in corporate philanthropy, look to one of the oldest proverbs: If you want to go fast, go alone; if you want to go far, go together.
This African proverb perfectly encapsulates why thousands of community-minded Americans are coming together in giving circles – whether through their employer or civic group or neighborhood – to make high-impact philanthropic decisions.
The concept is simple and appealing. Individuals pool their philanthropic resources into one fund and decide together how best to use the fund for maximum effect. These giving circles, which actually have their roots in numerous cultures, are experiencing a spike in popularity in the United States.
It is, perhaps, not a coincidence that the increased popularity of giving circles coincides with sky-high consumer and employee expectations of corporate citizenship. These trends are leading many companies to re-evaluate the ways in which they engage both stakeholder groups in their giving.
Giving circles are a quintessential “employee engagement” with numerous added benefits for employees and employers alike. Participating employees have the opportunity to:
- learn about local challenges in a deeper, more meaningful way,
- become closer to the communities and causes about which they care,
- expand their professional and personal networks,
- refine skills and develop new ones through research and decision-making processes,
- gain an appreciation for the role of their employer in solving problems,
- come into the fold of effective philanthropy (which is especially valuable for those who might not have the time or resources to give on their own), and
- live out their company’s inherent trust in them to make the best decisions around philanthropic support.
The benefits for employers are equally abundant. An effective employee giving circle can:
- provide a competitive advantage and bring a company in line with or ahead of philanthropic trends,
- engage employees how they want to be engaged – on issues about which they care and through a process whereby they can actually make a difference,
- boost employees’ confidence, morale, and talent by reinforcing the company’s trust in them,
- be an effective recruitment tool, especially for the millennial generation, of which 64 percent prioritize a potential employer’s social and environmental commitments when deciding where to work,
- be attractive to consumers, 55 percent of whom are willing to pay extra for products and services from companies committed to positive impact,
- augment the work of a company’s foundation, which typically provides a good jumping-off point for community relationships and supporting data, and
- come at a very low cost to the company, especially when partnering with an experienced manager of giving circles like the Community Foundation of New Jersey.
At the Community Foundation of New Jersey, we have seen firsthand the impact of giving circles on participants and recipients alike. As host to four women-led giving circles – called Impact 100 – that focus on different regions of the state, we have seen a surge in giving and the camaraderie it manifests. Approximately 1,000 New Jersey women have come together through these Impact 100’s and have made a total of 28 transformative grants totaling nearly $3.5 million. Whereas this sum might have otherwise been spread across hundreds or thousands of organizations (or perhaps not given away at all; there is growing evidence that giving circles increase philanthropy), the 28 high-dollar grants have fundamentally changed the recipient organizations for the better and created a ripple effect of additional, sustainable giving.
Members of the Impact 100 giving circles cite a range of reasons for their participation, from the social to the more data-driven, as well as a growing belief that better philanthropic decisions occur after discussion, deliberation, and a little bit of democracy.
The time is right for New Jersey companies to offer this proven and popular philanthropic option to their employees. The benefits for everyone involved increase every day.
Jordan Glatt is director of strategic partnerships at the Community Foundation of New Jersey, which counsels New Jersey families and businesses on how to use philanthropic funds to target and increase the impact of their giving in the areas that matter most to them.