A Little Phil guide to strategic philanthropy

A Little Phil guide to strategic philanthropy
Written by
Little Phil

Businesses engage in philanthropy for a variety of reasons. For some, it's a way to give back to the community and make a positive impact. For others, it's a way to improve their public image and reputation. But what if there was a way to do both? Strategic philanthropy is a way for businesses to support causes in a way that benefits both the company and the cause itself. In this article, we'll explore what strategic philanthropy is, why it's important and how businesses can make the most of it.

What Is Strategic Philanthropy?

Strategic philanthropy is an approach to corporate giving in which a business designs its charitable endeavours to align with and support its greater goals.  This type of philanthropy often takes the form of cause marketing, in which a company partners with a nonprofit organisation to support a shared goal.

An important distinction to make here is that strategic philanthropy is not completely altruistic. Of course, it is done with the intention to do good, but is also used by businesses as a tool to bolster their brand.

Understanding The Key Elements Of Strategic Philanthropy

What makes strategic philanthropy unique from other types of giving is that it's very much a planned process. Companies use it as a way to achieve specific business goals and need to take various factors into account to make sure their efforts are effective. The following are the three main components of strategic philanthropy and what they involve.

1. Goal Setting

The first step in strategic philanthropy - or really any business endeavour for that matter - is goal setting. In order to clearly understand what needs to be done, companies must first identify the objectives they are trying to achieve. This is one of the main things that set strategic philanthropy apart from other forms of giving; any business can contribute to a cause and do some good, but those looking to create larger-scale, impactful outcomes will best serve their intentions through a well-thought-out plan of action.

2. Data

Whether you're talking about philanthropic projects or budget forecasts, data is the most important tool businesses have at their disposal. It's their window into understanding the environment around them and likewise creating plans that deliver results.

In the scope of strategic giving, data is necessary to identify the key targets and success metrics a business should consider when creating its approach. Organisations need to be able to define the issues that matter most and understand the factors influencing them to cater their plans accordingly.

Collaboration with shareholders, employees and communities at large help them do just that, as well as collect the evidence-based insight necessary to make their efforts as impactful as possible.

3. Measurement

The final aspect of strategic philanthropy, measurement, is an ongoing process. It involves continuously monitoring a plan's progress to ensure results align with its ultimate objective, correcting any bumps in the road should they occur. This accountability is essential to keeping project efforts on track and ensuring that outcomes are successful.

Another thing that makes strategic philanthropy unique is that measurement isn't common in more conventional forms of giving. It comes from a very business-minded outlook and is done to quantify and validate the investments a company makes in its strategy.

Why Engage In Strategic Philanthropy?

Strategic philanthropy (and corporate giving in general) is often dismissed as 'unnecessary' or a 'waste of time and resources. Nothing could be more untrue. There has been found to be several real, tangible benefits to engaging in it as a business, the most notable of which we'll list and explain below.


Businesses, politicians, celebrities, you name it - we're all remembered for our actions. And this is especially true for brands. As major organisations with a large influence, they're held to a high standard by the public in terms of what they do, how they operate and the ultimate impact they have on society.

A solid reputation is the cornerstone of a successful business and something that should be actively managed and cultivated.

Strategic philanthropy is one of the best ways to do this. It allows businesses to take a stand on the issues they care about and be vocal in their support. It shows that they're not just in it for the bottom line, but that they're committed to making a difference. Creating a purpose beyond profit. By taking the initiative to do good, brands can associate themselves with all the feel-good, positive emotions that come with it and improve their image in the process.

Employee Engagement

Employee engagement is one of the most important indicators of a company's success. A disengaged workforce is unproductive, unmotivated and more likely to leave, costing businesses time and money in the long run. On the other hand, employees who feel like they're part of something larger than themselves are more likely to be engaged in their work and committed to their company.

Strategic philanthropy can be a great way to improve employee engagement. When done right, it can foster a sense of purpose and belonging in the workplace as employees come together to support a common cause. It can also be a great way to promote team building and unity, as employees work together towards a common goal.

Market Differentiation

In today's insanely competitive business landscape, companies know they need to stand out from the crowd in order to succeed. Customers are at no shortage of options, and it comes down to a brand's individual characteristics to get their attention and dollar.

Beyond flashy logos and slogans, corporate responsibility is a great way for businesses to differentiate themselves from the competition. It appeals to an increasing desire among consumers to create social good, especially demographics like millennials which are quickly taking up a majority of the marketplace.

Research backs this statement up. According to a global study by Zeno Group, consumers are four to six times more likely to purchase from and support a purpose-driven company.

What's more, another piece of research by Cone Communications found that 87% of consumers would buy a company's product because it advocated for an issue that matters to them.


As the last point referenced, consumers tend to put their money where their values are. They also keep it there, which is why strategic philanthropy is essential for not only attracting but retaining buyers.

Customers who feel like they share the same values as a company are much more likely to be loyal to that brand. They're inclined to trust it, and are less likely to have their attention swayed by a competitor. 

Investing in causes also sends the message that businesses are in it for the long haul. It tells customers that they're not interested in making a quick buck but that they're committed to the issues they care about and the difference they want to make in the world.

How Do You Develop A Corporate Philanthropy Strategy?

There's no doubt that strategic philanthropy can offer numerous benefits to the businesses that engage in it. But how do you get started? What goes into making a successful plan? We'll look at that here.

1. Start Small

Just because you want your impact to be as big as possible doesn't mean that you should target causes of the same size. Yes, contributions make a difference wherever they go, but targeting smaller, local initiatives can actually make more sense. Here's why.

Easier Connections

For one, it's easier to build relationships with smaller organisations. You're more likely to have a personal connection with someone working at a local charity than you are with someone at a national one. These relationships are key to making sure your contribution is used in the most effective way possible.

Greater Impact

Local charities are also often more in need of donations than larger ones. They don't have the same level of visibility or donor base, which can make it harder for them to raise money. Your contribution can go a lot further at a smaller organisation, and have a greater impact as a result.

2. Choose A Cause That Aligns With Your Company's Identity

A major aspect of strategic philanthropy, it's essential to ensure that the cause you choose to support makes sense for your company's long-term plan. It will need to align with its identity, core values and products in order to be effective.

For example, a baby food company might want to support early childhood education initiatives, as it would be in line with their mission to promote healthy development. Similarly, a company that sells sustainable products might want to donate to environmental causes.

3. Set An Example

Any company can be vocal about their support for a specific charity or cause - the ones that are serious about it are those who actually practice what they preach.

If you want your employees and customers to believe in your philanthropic efforts, you need to set an example. You can do this by donating a percentage of your profits, hosting fundraisers or offering matching gifts.

You can also encourage employees to get involved by offering volunteer days or opportunities to donate their time and skills to the causes you support. Not only will this help to engage employees, but it will also show customers that you're serious about making a difference.

4. Collaborate

So you've chosen a cause to support. Why not make it official? Choosing to work directly with nonprofits is a great way to build relationships and ensure that your contribution is used in the most effective way possible.

Not only will this help to build trust between you and the organisation, but it will also allow you to better understand their needs. This way, you can tailor your support to have the greatest impact.

5. Publicise

While doing good is obviously the main point of strategic philanthropy, its purpose as a business tool can't be ignored.  After all, one of the main reasons companies engage in philanthropy is to improve their public image and reputation. This doesn't mean that you should only donate to causes for the publicity it will bring - but if you're doing good work, it makes sense to let people know about it. This can be done through social media, PR campaigns, or even just by putting up a sign in your store.

Hopefully, this has given you a better understanding of strategic philanthropy and how it can be used to benefit both your company and the causes you support. By following these tips, you can make sure that your contribution makes the biggest possible impact.            

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