Doing Well by Doing Good; Organizing Contributions With A Firm Giving Policy

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By Bruce W. Marcus, [email protected]

We're getting to that time of year when the requests for corporate donations to good causes begin to come in. So much need. So few available dollars.

And as you grow larger, and make deeper inroads into your community and your market, so too do the demands and urgings for your participation increase.

Obviously, you can't respond generously to everyone who solicits your help. Here, then are some suggested guidelines for allocation of firm time and funds for non-practice activities, such as donations and participation in community, charitable, professional, and client activities.

It's probably the better part of wisdom, before establishing any policies, to ask the partners and staff of the firm (via questionnaire) to give some input on their own practices, organizations, and so forth. This should give you a greater sense of what you're doing now, and what you might want to do differently. Unless you already have a firm giving policy in place, you'll be surprised to find a lack of rhyme or reason for much of what your firm gives now – all the more reason for a written policy and guidelines.

Consider, first, the compelling reasons for participation in being generous with both funds and time…

  • Networking. Meeting and developing relationships with people who are either potential clients or in a position to recommend you to potential clients.
  • Public relations. Activities that enhance your prestige and reputation as good citizens, even when there is no immediately perceptible direct benefit from your participation. This can be either firm or individual participation.
  • Client relations. Activities supported by clients, who ask you to participate, or for which participation enhances your relations with clients.
  • Personal satisfaction. Activities in which individuals participate out of personal choice, but in which there are no immediate and obvious benefits to the firm.

Although it's difficult to set hard and fast rules – other than to establish budgets --by categorizing these activities it becomes easier to assess the potential return on the investment of firm time, money, and reputation. For example…

  • Networking. Participating in activities that give the firm and its people access to industry and municipal leaders is essential as part of any practice development program. Within the confines of limited budgets, however, priorities and assessments must be made regularly on the potential return on investment. Because individual participation in an organization can become entrenched beyond the point of value to the firm, these activities should be examined and reevaluated regularly.
  • Public relations. There are civic and industry (including professional) activities in which your participation spreads the firm name, and enhances your reputation as important to both the business and area communities. As valuable as these activities are, there is a ready ability to overestimate that value, and to devote too much time and effort to them. On the other hand, there are activities, such as an arts council, in which your prestige is enhanced by your participation, while at the same time doing good works for their own sake.
  • Client relations. When an important client asks you to take a table at his or her favorite charity or industry affair, the return on investment is fairly obvious.
  • Personal satisfaction. Except for those activities that the firm may feel are its traditional preferences, the personal preferences of each individual in the firm are exactly that – personal preferences. The firm's only concern in this area should be that personal activities should be recognized as such, and not confused with activities that redound directly to the firm's benefit. At the same time, a donation-sharing or matching program not only serves the recipient, it helps morale for staff.

Within each category, there are different kindsof participation. These include …

  • Money. While there are occasions where a budget must be bent for the right reasons, budgets should nevertheless be established. At the beginning of each fiscal year, attempts should be made to determine the events and activities that should be anticipated for the coming year. Matching funds policies should also be established.
  • Name. Sometimes all that is asked of you is to lend your name to an event. This has to be assessed on an item by item basis.
  • Time. The amount of time spent in public service, community, and industry activities can be as demanding and expensive as money. Here, too, the concept of return on investment applies. And here, too, care should be taken that unexamined and entrenched activities don't go beyond the potential benefits.

Looking at a firm contribution policy by breaking activities down into the foregoing categories will help simplify a complex and difficult exercise. At the same time, budgeting time and dollars should not be so inflexible as to preclude opportunities to help the firm by helping the community and the profession. As the brilliant Bill Ruder (co-founder of Ruder & Finn) used to say, “We do well by doing good.” Planning and budgeting helps you do better by doing good better.

Reprinted by permission from The Marcus Letter
Contact Bruce Marcus at [email protected]

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