Is Corporate Matching an Obstacle to Greater Social Impact?
On average, only 10% of corporate employees participate in a corporate matching program each year.¹ The rest sits waiting for employees to donate first. This is a huge opportunity cost for doing good and a missed opportunity for fostering a corporate culture better aligned on shared values. The good news is it also represents an opportunity we can easily fix today.
Why do businesses wait for employees to donate first? It’s safe to assume that businesses want to use this money to support their employees in an area that is meaningful to the employee. But, it is clear from years of data on corporate matching that very little money ever gets deployed, and therefore, very few employees ever feel this support.
Does this mean that employees don’t have an interest in donating to charities? The data suggests that’s not the case at all. Seventy percent of all giving this year will be done by individuals.² This amounts to approximately $1 billion a day.² So why are so many employees giving, yet their donations aren’t being matched?
Companies want to give. They allocate money in matching programs so they can facilitate giving. And they want their employees to feel supported. Employees want to give. They are giving because it is important to them, but they’re not giving in a way that earns matching funds. There is a simple and easy way to bridge this gap and achieve both goals.
A Simple Solution
When a company has committed a budget for corporate matching, the optimal way to use these funds is to create a program that allocates these dollars to the employees without waiting for them to donate first. The program should have a time period for how long each employee has to donate to a valid nonprofit before the money is reallocated to other team members. This way, available funds don’t sit idle creating a missed opportunity for social impact and for building a more connected corporate culture.
Another advantage of giving the money to employees first so the dollars actually get used is that it leverages one of the amazing aspects of the diverse culture companies work to build. Diversity of values, life experience, and geography are all-powerful characteristics for people choosing a broad mix of charities to support. Also, getting the money out to employees means putting funds in the hands of employees who live in different communities and closer to the needs of their community. This allows for better vetting of which charities can make the greatest impact.
Charitable Giving Matters
Charitable giving matters to employees, and it matters to building a respected culture and brand. Giving impacts many areas inside and outside the organization.
First, the act of giving has significant positive impacts on the health and wellbeing of the giver. When management provides money upfront to employees to donate, managers experience the emotional and physical wellness of giving the gift and then pass this benefit on to their team to experience.
Second, corporate giving provides a meaningful way for employers and employees to align beyond company KPIs and day-to-day operations. The “Great Resignation” is just the opening shot in the need for rethinking and redesigning a corporate culture where the smartest and most creative will choose to flock and nest.
Third, giving impacts brand as well as employee retention and recruiting. There are many case studies of great brands being built upon customer and partner support because the business stood for doing good as well as making a profit.
Finally, these unused dollars have the potential to make a profound impact on the lives of those who desperately need the help today and not years from now. Let’s not wait to make improvements in the health and safety of kids, animals, and the environment because two generous parties want to give but one is waiting for the other unnecessarily.
Making the Case
For those who cannot move to the solution without understanding or speculating on what the underlying cause of the problem is, I offer two possible reasons employees give so much but don’t ask for matching. First, they may be concerned that it undermines their ability to ask for a higher salary if they have extra money to donate. Second, the operational hassle of applying for matching is not worth the effort. The ask for matching is really working on behalf of the charity and goes beyond the emotional benefit the giver already experienced through their gift.
We have the money to give. We have the companies and people who want to give. We have kids, animals, and an environment that all need our help now. It is all just sitting there, and all we have to do is act. I invite every CEO and HR team to seize this beautiful opportunity to act and take a giant leap forward in building a better corporate culture, a more respected brand, and a greater impact on the world.