Why your enterprise should give back to the community, who to give to, and how to make the most of it.
Your company's greatness has many measures. Profits and rising value are essential. Recognitions such as being named “Best Places to Work” is another measure. But as time goes on, one of the ultimate yardsticks for an enterprise's greatness is its legacy. What has your company done for its community, and how has its existence made the world a better place?
Joan Steinberg has led Morgan Stanley's Community Affairs Team for 20 years and has more than quadrupled the company's giving in that time. During her tenure, Steinberg has seen philanthropy evolve from “a nice thing for companies to do” to a fundamental requirement.
"Consumers expect companies to be good neighbors and a community service organization. That's become a license to operate," she says.
Under Steinberg's leadership, Morgan Stanley has focused its philanthropy on one main mission: children's health. This has given the company a chance to make a substantial difference in a vital and pressing need, and has also provided endless engagement opportunities for the firm's over 50,000 employees.
Companies of all sizes can take a strategic page from Steinberg's playbook by deeply integrating giving into a company's identity.
“These should be integrated programs that directly align with the brand," Steinberg says. "We designed our structure around criteria that are specific to the firm's culture, to our brand attributes, and to what we do.”
If your organization is seeking to improve its connection with your community, the three questions your company leadership should ask before creating a philanthropy program begin with why, who, and how.
Consumers expect companies to be good neighbors and a community service organization. That's become a license to operate.
For Steinberg, all of the business benefits of a company philanthropy program take a back seat to one central focus: Needs of the community.
As Morgan Stanley has prospered as a company—and helped its clients prosper—it's vital to keep sight of the deep needs of those who have not been so fortunate. In order to maximize impact, Morgan Stanley focuses on the most fundamental needs: food and health.
Beyond the satisfaction of addressing needs, your company will also derive unique rewards from giving back. The goal is to meet real needs in a community in a way to also creates value for your company and your brand. “To be clear, this doesn’t mean that you should seek to make money through engagement. Think instead about softer issues, like how your giving will affect your brand, endear you to clients/consumers, and perhaps most important, how your employees will respond to your activities,” says Steinberg.
“Community engagement for the employees creates so much value. It makes the employees feel really good about themselves, which makes them feel good about your firm. It adds that work/life balance that people want.”
When narrowing down whom to help, Steinberg recommends letting employees lead. When charities are selected based solely on founders' or CEOs' passions, employees may not feel ownership of the cause. Then there's the risk that the effort will fall by the wayside when company leadership changes, instead of growing as an enduring part of the company's identity.
"The more it can be a democratic process within the entity, the more employees can be engaged," Steinberg advises.
For a company like Morgan Stanley, where employees are the company's main asset, finding a cause that captured employees' passion was vital.
"We opted to focus on children, which was the most import thing to our employees," Steinberg explains.
But another question leadership should ask is “What is our company's community?”
"If you are a retail outlet where people come in and out of your space, for you not to support your neighbors and your fence line community would be a mistake," Steinberg says. "But if you're an Internet-based entity, I would look at who my consumer is."
Morgan Stanley is at its heart a local company—with Financial Advisors in thousands of communities across the United States. To match that footprint, Steinberg's team has forged partnerships with nationwide nonprofits that have plentiful local branches. For example, Morgan Stanley partners with Feeding America, which has more than 200 food banks and more than 60,000 agencies throughout the United States, giving employees the chance to volunteer and donate locally.
Any nonprofit director will tell you: Money is what is needed most.
“I cannot understate the need for financial support for nonprofits. There's no mission unless they have money," Steinberg says.
"That being said, partnerships should go beyond the cash," she adds. "Go ahead and write the check because it's critical, but it's also a wonderful opportunity for the employees to go with the check." Partnership is also the key to forming lasting relationships which deepen over time.
Giving the gift of employee expertise and time forges a deeper relationship between company and nonprofit. Sometimes these interactions can also be concrete opportunities for professional development. For example, one program at Morgan Stanley gives employees the opportunity to create and present strategic plans to nonprofits, developing skills that they later use with clients. Morgan Stanley also encourages and trains growing leaders to serve on nonprofit boards, and experience that can be invaluable in developing decision making and influencing skills.
Gifts in-kind, also referred to as in-kind donations, can also be a powerful way for companies to help those in need, while boosting their brand at the same time. These types of gifts can vary from goods such as computers or furniture—to services like meeting spaces and foodservice—to knowledge gifts such as legal advice or strategic planning consulting.
"You want to partner with charities who can effectively use your product or service to advance their cause," Steinberg says.
All in all, giving back to the community is a win/win for any company that has grown to the level where it has profit to share. Finding the smartest way to give is just as important as choosing the right strategies for investing and growing the company.