Insights: Calculate the Value of Corporate Giving

One graduate shares his expertise.

David FinchJuly 2011

Dr. David Finch ’10, Ph.D. in Applied Management and Decision Sciences (now Ph.D. in Management)

Brain scan research shows that when people give to others, it makes them feel better. Giving is a reciprocal relationship, and it’s no different with corporations. When people run a business with the goal of serving others, financial benefits will follow. People want to support businesses that serve. Dr. David Finch, the 2011 recipient of Walden’s outstanding dissertation award, demonstrates the return on investment (ROI) of corporate giving in his dissertation research. Here, the assistant professor of marketing at Mount Royal University in Calgary, Alberta, highlights the benefits from two perspectives.

The Corporate Perspective

DON’T UNDERESTIMATE THE POWER OF ADVOCACY. 
Is it possible to measure the value of people liking your company? Maybe not directly, but you can measure how people behave differently when they like your business. One of the key behaviors that can be measured is advocacy. Will your employees talk about your company in their community? Will your customers refer your company to their friends? People will only be your advocate if they trust you. Trust takes time, but it is an authentic demonstration that you share the same values. This is the power of corporate giving.
 
EXAMINE THE NUMBERS BEHIND LOYAL BEHAVIOR.

Loyal behavior can be defined by consumer purchasing habits. If consumers are more likely to purchase your products because they believe they share your values, you can measure this behavior and track its impact.

OFFER YOUR EMPLOYEES A WAY TO GIVE BACK.

One advertising agency donates $100,000 a year in creative services to two charities, including full rebranding for the nonprofits. In return, the agency is recognized as more than just a place to work, because it’s providing a way for employees to give back. The company gains public recognition and fosters goodwill with its employees because of the partnership.

CONNECT WITH A CAUSE THAT MATTERS TO YOUR EMPLOYEES.
 
CIBC bank in Canada is the title sponsor for the national breast cancer run called CIBC Run for the Cure. The run raised $33 million for breast cancer research, education, and awareness programs in 2010. CIBC got involved because many of its bank teller employees are women between the ages of 35-54 who are passionate about the cause. The bank’s management team strategically decided that if the cause matters to frontline employees, it’s important to them. When employees stay because they believe the bank cares about them—that’s measurable value to the bank.

The Nonprofit Perspective

VIEW CORPORATE SPONSORSHIP AS A LONG-TERM BUSINESS RELATIONSHIP.

Know that a partnership will build value for both parties, as opposed to a one-time contribution to your cause. By forming a long-term relationship with a corporate sponsor, you are appealing to something they want—long-term visibility and association with a reputable cause to build credibility. In turn, your nonprofit can receive long-term financial support. With 1.5 million nonprofits in the United States alone, competition for financial support is intense. Nonprofits committed to the cause long-term will have more success.

OFFER A SOLID MARKETING INVESTMENT TO THE SPONSOR.

You can help corporate sponsors by touting the promotional value you will offer them. Pitch the amount of publicity you can provide to them during events, receptions, and in marketing materials as well as press coverage on TV, print, and radio. Let the corporate sponsor know how you will feature them in a prominent way.

SHOW CORPORATE SPONSORS HOW YOUR MISSION IS IN SYNC WITH THEIRS.

Research the demographics of your corporate sponsors’ consumers and look for connections to your nonprofit’s cause. The NFL Play 60 program is a great example. This program recognizes childhood obesity as a central issue today and aims to increase the wellness of young fans using celebrity athletes who encourage kids to be active for at least 60 minutes a day. Nonprofit partners, such as the American Heart Association and the Boys and Girls Clubs of America, share a similar cause to NFL’s program—enriching the lives of children and showing them how to lead a healthy lifestyle. The missions are aligned.

BE THE BRIDGE FOR CORPORATIONS TO GAIN SOCIAL AND ECONOMIC VALUE.

Nonprofits can facilitate social value for corporate sponsors—the value defined by the community—leading to economic value. The example of CIBC’s partnership with Run for the Cure shows how the bank gained social value by raising money and awareness for breast cancer. But CIBC also increased its economic value with employee retention rates, job satisfaction, and productivity from bank employees. By showing how your nonprofit can provide social and economic value, corporations will want to form an alliance to further your mission.

Watch a video of Dr. Finch discussing his dissertation with his faculty mentor, Dr. Howard Schechter, here.

Read more about the Frank Dilley Award and past recipients.