Companies need new approach to philanthropy

Blindly giving to a charity isn’t enough,

Stories and studies about millennials are everywhere, many focused on what business leaders need to do to keep them happy at work.

According to a recent Gallup poll, just 29 per cent say they are engaged at work. If companies want to keep their millennial employees, they need to get creative. And it’s going to take far more than flexible work options, ping-pong tables and craft beer happy hour.

It’s been recognized that millennials hunger for meaning and purpose in work and want to make a difference in the world. Businesses need to find ways to engage their millennial talent, and one powerful way to do that is through social enterprise campaigns.

Social enterprise campaigns are the most promising new trend in philanthropy, says New Philanthropy: Building Lasting Change, a new report from BNP Paribas Wealth Management. This kind of “collaborative philanthropy” has big, positive implications for both businesses and employees, not only in retaining millennial talent but also in creating value and impact for everyone involved.

By incorporating social giving into the bones of a business, everyone gets involved and emotionally invested. It can be a transformative process that shakes things up, injects passion and purpose into the workplace and transforms our understanding of how corporate social responsibility can look in a small business context. It takes businesses out of their world of spreadsheets and client lists and cash flow and into the bigger picture of how money can be used for social good.

Here’s a recent example: Allan Financial, a small Vancouver insurance company, wanted to engage their millennial employees and give back in a meaningful way. They partnered with Kiva, a San Francisco-based micro-finance crowdfunding platform that loans money to low-income entrepreneurs in more than 80 countries. This wasn’t a philanthropy play, or a typical donation. It was a micro-loan initiative to support businesses that needed capital to launch and grow.

Over three years, Allan Financial raised a whopping $400,000, often in $25 increments, for 1,200 business owners in 33 different countries. And their “donation” was repaid in full within 12 months. This meant the company was able to send funds out again, a boomerang of philanthropy. It was incredibly innovative and impactful, especially for a company with just nine employees.

What’s remarkable is not just the numbers, it’s the realization that social giving doesn’t have to be a donation. If it’s done right, it can boost the bottom line for both giver and receiver. For Allan Financial, the campaign didn’t just inspire and motivate its millennial employees, it brought in new clients drawn to the company’s new reputation for financial innovation.

Another example of this new kind of philanthropy can be seen with developers and home builders who have partnered with World Housing. They donate a certain amount from the sale of each condo or house to World Housing to fund the building of homes in the developing world. Their one-on-one gifting model appeals and engages both those who work for the developers as well as homebuyers because it’s a meaningful, innovative, charitable partnership. It’s collaborative philanthropy.

Those involved with World Housing can follow the stories of those on the receiving end of the charity. They get first-hand accounts of how a family’s life is changed by being given a free, safe, permanent house. Similarly, those involved with Allan Financial’s Kiva campaign got first-hand accounts of how loans helped businesses — like an empanada cart in Bogota, Colombia or a shop in Nairobi, Kenya — succeed.

So many companies take the easy route and simply donate money in a routine annual drive, asking employees to chip in. Rarely does that model offer any value or impact on either side.

These kinds of social enterprise campaigns are on the rise because millennials expect philanthropy. They believe it’s an essential corporate responsibility to give back in a way that is meaningful and different.

So how do you create an impactful social enterprise campaign for your business? Certainly not by blind giving to a cause. The most important lesson I learned during the Kiva campaign was partnering with an innovative organization helped make the company more interesting and compelling, particularly for tech-savvy millennials who are looking to be part of an organization that does more than just business as usual.