As news broke last week that Facebook's Mark Zuckerberg and his wife, Priscilla Chan, pledged to give away nearly $46 billion in Facebook Inc. shares, I started thinking about my own philosophies regarding the importance of companies' philanthropic initiatives.
While Zuckerberg's plan is facing criticism and some perceive it as a model for sidestepping tax laws and public-disclosure rules, I believe it stems from altruistic reasons and all companies should give back in one way or another. I think we all have a responsibility as individuals and as corporations to give back.
Companies need to instill a culture of giving back and such efforts always need to start from the top down. Giving back not only drives change in your community but also within your organization. This is at the core of Driven Brands' non-profit, Driven Brands Charitable Foundation.
Here are three reasons why companies should leverage their own financial success to help those around them:
1. Boost Employee Morale
Participating in philanthropic initiatives helps employees feel good about themselves and proud about where they work, which in turn builds loyalty among them. When employees don't feel connected to their job, they invest less of themselves in their work and the quality of employees' work is critical to a company's success.
In my experience, companies that emphasized giving back have built strong connections with their employees, and this was demonstrated when the average tenure would surpass that of their counterparts who didn't participate in charity events. They have made it part of the culture, such as Zappos or Target.
Giving back is also an important part of my own organization's culture. For Veterans Day, several of the companies within Driven Brands give back to veterans through Cars and Stripes, a program where refurbished vehicles are donated to a veteran in need. The positive response, not only from the community, but from the employees, was overwhelmingly positive.
2. Build A Strong Reputation Within The Community
When businesses help others within their communities, the community also reciprocates and offers support - it becomes a mutually beneficial relationship. Additionally, when participating in community-based events, there is the opportunity to meet members of prominent local organizations and potential new customers. Your brand will build a reputation for giving back and caring about the communities it serves. Developing such a reputation of goodwill within the community is a sure way to build a strong support network of people who will speak positively on your behalf and help your company stand out amongst the competition. It's also always inspiring to me when I hear our franchisees say they have gained new customers after participating in community events, because it helped them stand out amongst other companies who weren't there.
3. Consumers Prefer Socially Responsible Companies
A study conducted by Cone Communications and Echo Research revealed that more than 90 percent of consumers would switch to a brand supporting a good cause. Additionally, more than 85% of millennials correlate their purchasing power to the responsible efforts a company is making. Millennials are one of the most sought after target audiences today and their collective purchasing power measures in the hundreds of billions! They are noted for approaching business and capitalism with a conscience, and to win them over it's important to do so through the action of giving.
Helping others in need should be reason enough for companies to take on various philanthropic efforts, but if that's not motivation enough, then hopefully a positive return on investment will be.
With the holiday season in full gear, it's only natural for everyone to get in the spirit of giving. I hope this year more companies make this effort year-round and give back to make a difference on a local and global level.