Corporate Building Blocks

Philanthropic Best Practices for Companies in 2021

December 22, 2020

Best practices in philanthropy are indeed shifting as we approach 2021. While there is no one organization doing it all perfectly, foundations looked to as leaders are in front of the trends—increasing their giving in response to rising global challenges; looking critically at their internal structures and staffing to better reflect the communities they serve; shifting their policies to more effectively support their grantees on the front lines; re-thinking their programming to better address emerging challenges and support community leaders most proximate to the issues they are working to solve; and focusing on the roots of the problems rather than the symptoms. They are also working with urgency to address the broader range of historic criticisms of being “top-down, closed-door and expert-driven.”

On top of all that, they are…

  • Discerning. They know they can’t solve every problem, and in order to have a significant impact, they cannot spread their grant-making too thinly. They work on three to five core issues.
  • Risk-takers. They are trying out new models, putting significant money behind big bets and bringing unconventional partners to the table.
  • Impact-driven. They build robust monitoring and evaluation frameworks at the start of programming, fund significant research, and harness data to both drive decision-making around grant-making and measure their overall impact.
  • Driving the conversation around solutions. They have a strong and visible thought leadership agenda. They use compelling storytelling to reach their key audiences. And they tap every forum, every media channel, and every opportunity they can to build momentum around the solutions they champion and drive other philanthropists, governments and businesses to do more, and to do better.

Corporate foundations, often segregated within the broader philanthropic landscape, should be (and increasingly are) held to the same standards. Yet they no doubt operate in a slightly different context. The role of business in the social sector is growing in exciting ways. Business leaders are increasingly owning their seat at the table, taking on new levels of responsibility, and deploying a strong and influential voice with a clear point of view on how we solve the most pressing domestic and global development challenges. Partnerships between traditional and corporate foundations are becoming more common. Moreover, the companies (and associated foundations) that are consistently spotlighted for their leadership and impact exhibit a set of defining characteristics:

  • Aligned and strategic. They have determined the unique value they bring to the world and focus on a select number of issues that align with their core business and mission. Going a step further, they align their business strategy, decision-making processes and organization-wide policies (across the business and the foundation) with the challenges they are working to solve.
  • Transparent on inconsistency. They understand that philanthropy, corporate citizenship and capitalism itself is facing an elevated level of scrutiny. When their business practices are lagging behind their philanthropic giving, they are honest and up front, bringing their customers, their Board and a range of stakeholders along with them on their journey toward progress.
  • Long term. They understand that while business cycles are short, generating real impact in the social sector is a long-term endeavor. Their research agenda, partnerships and grant-making reflect that understanding.
  • Coordinated. They function not as an isolated unit, but instead harness the talents, resources, energy and business insights from their parent company to achieve their goals. The foundation and business units work hand-in-hand on key issues, with the foundation serving as a platform to look into the future, to go farther and to invest in solutions the parent company cannot.
  • Bring everything to the table. They give financial contributions and build strong partnerships with organizations on the front lines of the issues they are working to solve. They engage their employees in the work, leveraging employee-giving through donation match programs and encouraging volunteerism by offering employees opportunities to engage with partners while on the clock.

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