I was checking some facts about giving in the US for my book this morning and I found a press release issued September 19, 2008 from Giving USA Foundation about the impact of recession on giving levels.  It stated,”What really happens to charitable giving when the economy is roiling? A new report from Giving USA Foundation examines the topic from the aspect of past recessions and economic slowdowns, and discovers that while there is an impact on giving, it’s not as dire as conventional wisdom would assume.

“When the economy is uncertain, as it is in 2008, non-profits and others naturally assume the one sector that will be heavily impacted is philanthropy,” said George C. Ruotolo Jr., CFRE, chair of Giving Institute: Leading Consultants to Non-Profits and past chair of Giving USA Foundation. “With history as our guide, we know that’s not true. In fact, while charitable giving is impacted by recessions and/or economic slowdowns, it’s not by nearly as much as one might expect.”

Read the whole release and see what you think.  Of course, this was issued before the big slide on Wall Street…so I wonder if it will still hold true?  At Denver’s Two Percent Club event this week, business leaders certainly were concerned that the 40 percent reduction in foundation assets due to recent Wall Street events would significantly impact their ability to give in future years.

This morning I attended a breakfast sponsored by the Two Percent Club at the Denver Country Club.  The Two Percent Club is an organization actively promoting business involvement in the community.  Their website states: “The member companies of the 2% Club consist of a wide range of industry representation and include every size of business, from sole proprietors to the largest employers. They have supported hundreds of Denver nonprofits with donations, employee volunteers, in-kind support and pro bono services. These leaders encourage and demonstrate business involvement in the community through their support of philanthropic efforts within their own companies, through their own personal commitment and through their leadership and encouragement of others.  We encourage you to get involved—-it’s just good business.”

While we ate our breakfast, each of the six round tables discussed 11 questions concerning community involvement.  They were great questions – I suggest you take a minute and think about the answers to them from your own perspective.

1. Have you arm twisted your vendors or suppliers to get them involved in the community?  How did that work for you?
2. Are government projects and iniatives appropriately steering resources to causes or are they taking funds away from other community groups and causes?
3. Has your company tied your community efforts back to business goals?  If so, how?  Any cause related marketing projects?
4. How do you find time for community efforts – for yourself or your company/employees?
5. What impact is the economic situation having on your giving now or in the future?  What about the overall impact on the nonprofits and the community?
6. Is it OK to self-promote your community efforts, or is that being disingenuous?
7. Do you measure your community efforts?  If so, how?
8. Are your employees involved?  What impact does that have on morale/productivity?
9. Is it good to have a narrow communtiy focus or more of a broad-based focus?
10. Is it appropriate for nonprofits to be invovled in political issues?
11. Black-tie dinners-enough?  Or bring ‘em on?  Alternatives?

The keynote speaker for the event was Peter Coors.  Peter currently is Vice-Chairman of the Board of the Molson Coors Brewing Company.  He previously served as Chairman of the Board of Adolph Coors Company since 2002, and was Chief Executive Officer from May 2000 to July 2002. Peter talked about the unique philosophy we have in the United States concerning citizen (and business) involvement in philanthropy as compared to many other countries where the government is expected to provide all needed servcies in communities.  He talked about business philanthropy being not an obligation for companies as no one is making us do it – rather he feels it is the right thing to do and makes good business sense.  People want to do business with people they think care.

Peter highlighted eight things for companies to remember when engaged in community involvement.

1. Keep your corporate hat on when working with nonprofits – bring business thinking to addressing community issues.
2. Encourage nonprofits to measure their results and business can help with that.
3. Help nonprofits measure their effectiveness using both quantitative approaches while also focusing on the harder to measure feel good factor.
4. Offer in-kind resources
5. Encourage employees and their families to get involved in community projects.  Encourage them to have the same giving philosophy as the business’ leaders.
6. Effectively use your business leverage to make things happen.
7. Be creative, shake up the status quo and look at things differently especially during tough economic times when dollars available have diminished – right now by 40%!!
8. Never doubt the Power of One!  Adopt one school, mentor one child, help one neighborhood.  One person or one business – can make a difference.

It great to have been invited to participate in this event and meet leading local business people who are so committed to supporting their local communities.  The Two Percent Club has a new website and is now actively looking to engage even more businesses as part of its membership.  I am glad to be a member!

Last week I was in DC helping run the State Service Commissioner Institute presented by the Corporation for National and Community Service (CNCS), Project TASC of JBS International, and the America’s Service Commissions.  As I sit here, back in Denver I am amazed that after my 14 years of working with state service commissions and AmeriCorps, how many people are still unaware of them.  When I mention that I train and consult with AmeriCorps, I often still have to say, “you know…it is the domestic Peace Corps.”  It is still a bit of a well kept secret and that is a shame.  One of the topics I have done extensive work on with AmeriCorps programs nationally is performance measurement and evaluation.  So what I know to be true is that the vast majority of these programs are providing fabulous service to their communities and making a significant impact - because I have helped them figure out how to measure it!

What is AmeriCorps? 

For those of you that don’t know, AmeriCorps is a National Service program that places members (aka volunteers) at nonprofits and state/local government agencies, often in teams, to provide volunteer service addressing identified community needs.  Full-time members give 1700 hours of their time, receive a tiny monthly living stipend, and at the end of their service commitment an educational award of $4725 to pay for additional schooling or past educational debt.  While the majority of members are in the 20′s, there is no upper age limit and it is not uncommon to see 20 somethings working alongside people in their 40′s, 50s, and 60s from a wide range of backgrounds!  The monthly stipend is great, in my opinion, as it levels the playing field allowing people of any financial background to participate – not just those whose parents can afford to support them while they serve!

AmeriCorps programs are designed by community agencies to meet specific local needs in the areas of education, environment, public safety, human needs, and disaster services.  Members provide direct service working with the beneficiaries of their hosting organization doing such things as tutoring students having trouble in school, running afterschool programs, cleaning up neighborhoods, developing neighborhood watch programs, assisting communities hit by disasters, running food pantries, and building homes – just to name a few.  All AmeriCorps programs are required to provide direct service to the community, provide the necessary training for members to effectively provide their service and become more civically engaged, develop partnerships among community organizations, and recruit other community members to get involved as volunteers. 

AmeriCorps is one of the National Service/volunteer programs funded by the federal government.  However, it is interesting to note that AmeriCorps programs are required to match the federal funds they receive with resources generated locally – basically dollar for dollar.  State-based AmeriCorps programs are designed locally and state commissions are able to tailor the allocation of their AmeriCorps resources to insure they meet that state’s most pressing needs.

What is a State Commission? 

There is a bipartisan State Service Commission in every state in the country except South Dakota, as well as Guam and American Samoa.  In 1993, Congress passed the National and Community Service Trust Act that created the Corporation for National and Community Service to administer and oversee National Service. CNCS is the umbrella agency for the old ACTION Agency programs – VISTA and Senior Corps (RSVP, Foster Grandparents, and Senior Companions) – plus the newer AmeriCorps and Learn and Serve America programs.  As part of the Act, any state that wanted to receive federal AmeriCorps funds based on a population-based formula needed to establish a state service commission.  Commissioners are appointed by the Governor and commissions are run by a small administrative staff.  State Commissions basically have two main mandates.  The first is to administer the AmeriCorps program in the state to insure it meets critical local needs and second is to promote service and volunteerism as a way to address local issues.  Commissions are usually housed within state government (often in the Governor or Lt. Governor’s offices) or can be stand alone 501(C)(3)s.

Why should you care?

If your company is looking to get more involved locally or at the state-level with well run nonprofits and their programs, the executive director of your state’s service commission is a great person with whom to talk.  S/he will know about opportunities to volunteer in your community, regionally, and/or at the state level.  S/he can also point you to specific programs that could use your business savvy and resources to build their capacity to do even more good in the community.  Also the reach of commissions is wide – if you support their efforts, it is a great way to get your company’s name out there in a positive way!

AmeriCorps programs go through an extensive review and training process so you know when you choose to support one of them, they have been VERY carefully vetted!

The enthusiasm AmeriCorps members have about what they are doing in local communities is absolutely infectious.  It always reminds me that I need to get out and do more volunteer work myself.  Interviewing members for various evaluations I have conducted, I am constantly amazed at how much they have learned about local issues and how to be part of the solution, not just sit around and complain. 

Get involved!  To find your state’s commission, go to: http://www.nationalservice.gov/about/contact/statecommission.asp.  From there you can click to go to your state commission’s home page which lists all the local AmeriCorps programs.  Be sure to call the commission’s executive director if you have questions or want to know more about how to get involved.  I know them all – and there is no finer group of people on the planet in my view.  And…feel free to tell them I recommended you call!

I continue to ponder the effects of this Wall Street mess on business philanthropy as I watch friends of mine whose hard earned investments are evaporating seemingly over night!  What is true is that at times like this there is a tendancy for everyone to tighten the belt - one way many companies choose to do that is by reducing their charitable giving.  But what a Catch 22!  Giving is down right at the time that the need for assistance skyrockets!  While on one hand such a reaction is understandable, staying “in the game” is also important.  Not only can your company truly “do good” at times like this but your reputational capital in the community and among customers and employees can be truly strengthened by continuing to give back, even if in smaller ways than previously.

Dollars are down for social service programs from all sources – federal grants, foundations, individuals, businesses…  There was an article in yesterday’s New York Times that I found interesting - Economy Expected to Take a Toll on Charitable Giving by GERALDINE FABRIKANT.  In the article, Fabrikant states, “Foundations are required by law to give away at least 5 percent of their assets a year. But when their assets shrink, their donations tend to shrink as well. Gathering enough money to return to their previous level is often hard.  At the same time, individual and corporate gifts to foundations and other charities generally slow during hard times. According to research prepared by Giving USA, donations did not keep pace with inflation for three consecutive years around two economic slumps, in 1973 and 2001.”

So maybe you don’t have dollars to give right now but stay calm – your company has other resources it can share with worthy nonprofits – many of which you probably take for granted.  Maybe you know how to prepare press releases, collect customer satisfaction data, set up bookkeeping systems, develop and manage databases, have a conference room or parking lot you could loan out…the list of possibilities is long if you think out of the box about your assets.

One problem is that as nonprofits feel the pinch, there is a tendency for them to default to begging for cash which you may not have available.  The dialogue of how you could partner to benefit both organizations and share some other resource you have can be cut short prematurely unintentionally.  If you are approached for a cash donation, if you don’t have cash, you can’t give.  But if it is a cause or organization you want to support, take the time to explore other possibilities and needs they may have.  Get beyond the knee jerk reaction of saying times are tough, how can they ask for money when we are sucking air here and your guilt at having to say no – to seeing what IS possible.

Your company can’t support all the worthy groups out there.  One pack of hotdog buns to every nonprofit that asks doesn’t really make much of a difference.  During times like these, it is essential that your company be very strategic and creative about how you give back.  Being strategic does not mean taking advantage or being crass and inauthentic.  It is certainly more than OK to develop giving criteria and say no to the masses.  Focusing your efforts on a small number of nonprofits that you have some mission connection with can allow you to make a greater difference – both in the community and show that you are one of the “good companies” that didn’t cut and run when times got tough.

Rethink your business giving but please, don’t cut it off completely!  Be part of the solution in whatever ways you can!!

Yesterday, in my Google Alerts for Business Philanthropy, I got a link to an article on Rethinking Business Social Responsibility posted by DanS on Political Groove Forums.  It turned out to be something I had already read sometime back but I think it is interesting to read, if you have not already done so.  DanS provides a transcript of the dialogue that between Whole Foods CEO John Mackey and world famous economist Milton Friedman and Cypress (semiconductor) CEO T.J. Rodgers.

Mackey states, “there can be little doubt that a certain amount of corporate philanthropy is simply good business and works for the long-term benefit of the investors. For example: In addition to the many thousands of small donations each Whole Foods store makes each year, we also hold five 5% Days throughout the year. On those days, we donate 5 percent of a store’s total sales to a nonprofit organization. While our stores select worthwhile organizations to support, they also tend to focus on groups that have large membership lists, which are contacted and encouraged to shop our store that day to support the organization. This usually brings hundreds of new or lapsed customers into our stores, many of whom then become regular shoppers. So a 5% Day not only allows us to support worthwhile causes, but is an excellent marketing strategy that has benefited Whole Foods investors immensely.”

Friedman stated, “I believe Mackey’s flat statement that “corporate philanthropy is a good thing” is flatly wrong. Consider the decision by the founders of Whole Foods to donate 5 percent of net profits to philanthropy. They were clearly within their rights in doing so. They were spending their own money, using 5 percent of one part of their wealth to establish, thanks to corporate tax provisions, the equivalent of a 501c(3) charitable foundation, though with no mission statement, no separate by-laws, and no provision for deciding on the beneficiaries. But what reason is there to suppose that the stream of profit distributed in this way would do more good for society than investing that stream of profit in the enterprise itself or paying it out as dividends and letting the stockholders dispose of it? The practice makes sense only because of our obscene tax laws, whereby a stockholder can make a larger gift for a given after-tax cost if the corporation makes the gift on his behalf than if he makes the gift directly. That is a good reason for eliminating the corporate tax or for eliminating the deductibility of corporate charity, but it is not a justification for corporate charity.”

So just a little tension, eh? They both had a lot more to say than the small pieces I pulled for you.  Read the whole thing and see which parts of these positions resonate with you!  Of course, I am on the side of strategic business philanthropy being an essential component of business social responsibility.  I also believe, especially in light of recent issues on Wall Street, it is only good that there is rising peer and consumer pressure on companies to rethink their values and operating practices and give consideration to the Triple Bottom Line – not profit at any cost.

I have been thinking a lot lately about the impact of tough economic times on smaller businesses and their philanthropy - the subject of Carol Tice’s article in October’s Entrepreneur Magazine for which she interviewed me.  However, this morning in the USA Today was an article by Emily Bazar and Dennis Cauchon, Financial mayhem hurts non-profits, foundations.  Watching the news about the market situation last week, until I read this article, I now realize that it had not yet fully clicked through for me the impact this volatility was having not only on businesses but also on community foundations and nonprofits that invest in the stock market.  The article talks about the greatest impact being on those community organizations that rely on endowments and donations as they are expected to decline - resulting in lower payouts from foundations in upcoming years because of what is happening now. 

The article talks about the role of diversification of financial portfolios as a way to minimize losses…however the  closing quote from John Griswold, executive director of the Commonfund Institute, stated that “Diversification has been the name of the game in endowments, and that’s good,” he says.  “The problem is, in a crisis like this, everything can go down and diversification doesn’t help.”

To read the full article, click here.

I have been checking the bookstore daily for the October edition of Entrepreneur Magazine to be put out on the shelves.  Today I found it in the Barnes & Noble near my house in Denver.  The wait is over!!

I was interviewed a couple months back by Carol Tice for an article she was writing on the effects of tough economic times on small business giving.  She found me online and called to do an interview.  She was very knowledgeable about business social responsibility and the world of nonprofits so we had a great conversation.  I was contacted later by an editor at Entrepreneur to check the spelling of my name, the company name, that I was a Business Philanthropy Coach and from Denver.  So I knew I was going to be mentioned but had no idea what she would say exactly.

The article, Keep Giving Back: In a Struggling Economy, Entrepreneurs Get Creative with Philanthropy is on page 54 of the print version.  I am one of five paragraphs and got the closing line!

“If you’re short on funds but still want to help out your community, be focused and strategic, making sure the giving you do participate in is impactful and resonates with employees and customers, says Susan Hyatt, a business philanthropy coach.  Your company could loan out executives, provide mentoring, donate goods or participate in walkathons.  Entrepreneurs can also help charities raise their profile by chairing a fundraiser or serving on the board, which will inspire others to give as well…Says Hyatt, “This economy forces people to be more creative and rethink the best way to support their local communities.”

For the full article, click here.

The big news hit yesterday…IKEA is coming to Denver (well, actually Centennial)…FINALLY!  I can smell the Swedish meatballs and lignonberry sauce already.  As you can tell, I am huge IKEA fan – have been since 1990 when I lived in Crystal City, VA for a couple years working for the U.S. Agency for International Development and had my first experience with the IKEA at Potomac Mills.  Having lived in Finland as an AFS exchange student for a year and then 10 years later for another year as Fulbright Scholar at the University of Helsinki…IKEA (although a Swedish company) it is as close as I can get to the Finnish experience here in the U.S. most of the time.

Several years ago at the Business for Social Responsibility annual conference, I ended up sitting with the head of community relations for IKEA for a meal – by accident.  Thought I’d died and gone to heaven as I am such a loyal fan – kept trying to figure out how to offer my services for product instead of my usual fees…  Anyway, at that time they were in discussion about developing a partnership with Save the Children, a group I was also working with to develop systems to evaluate the impact of their domestic youth programs so we had a very interesting discussion. 

Later, in 2006, I learned that one of IKEA’s key partners was UNICEF and I wrote a post about that partnership as I thought it was very fun that they had an endless loop video detailing the partnership for customers playing on the TV in one of their living room displays in the Bloomington, MN store. 

Check it out!

Yesterday I was interviewed by Cheryl Powell, Medical Writer for the Akron Beacon Journal.  She is writing an article on Art with Heart, an Akron art gallery that has pledged 10% of their proceeds to the local Children’s Hospital as well as giving free art lessons to children touched by cancer.  Cheryl found me online and wanted to hear more about the business benefits of philanthropy as well as current trends in small business giving.  I look forward to reading her article and I was intrigued about the local business the story will be about.

(more…)

OK…so I am all about supporting nonprofits and actively seek to learn about the innovative strategies companies use to do that.  G.A.P Adventures’ Skydive for Charity is certainly creative but not one I will personally get involved with anytime soon! 

(more…)