Hamilton PR firm HMC Communications found saying 'yes' to every charity can be crippling. (Photo: Getty)

Generous to a fault: How businesses can give without breaking the bank

Small business owner Heather Claycomb learned the hard way that donating till it hurts is not how to change the world. She offers some tips for making an impact.

How many emails have you opened in recent weeks from companies telling you they donated to charity for the holidays? Corporate charitable giving at Christmas is now the norm rather than the exception, and Kiwis are caring people – according to the latest World Giving index, New Zealand is the third most generous country in the world.  

If you’re one of those corporate givers, what I say next could be rather challenging.

I believe if you want to create a wider community impact through your giving there’s a better way than making a deposit into a charity’s bank account once a year.

Before I go much further, keep in mind I own a very small business.  We’re a team of nine running Hamilton public relations agency HMC Communications. We operate on a typical SME budget, so when it comes to giving, we don’t have heaps of extra cash to flit away.   

But the glue that sticks our team together is that we wholeheartedly believe in the power of generosity. So that’s made us think more strategically about how to maximise the power of every donation.

During our 15 years in business we’ve learned a lot. We’ve found that you need to be quite strategic about your generosity or it can be your downfall. As a small business it’s easy to say ‘yes’ to giving away time, money and resources more often than you should, and that can impact on the bottom line in a big way.

So, here are four lessons that might help move your team from a casual Christmas donor to a purposeful year-long impactor.

Your time is valuable

As a small business we tend to donate more of our time than our cash. Last year we donated the equivalent of 6% of our revenues in time to two not-for-profits. Plus, we’ve put time into being a founding member of The Good Collective, an initiative where Waikato businesses are banding together to offer services to the region’s charitable and not-for-profit sector.

Giving time is common for many small businesses.  f you’re a plumber, you’re unblocking drains for people in need. If you’re a graphic designer, you’re developing websites for cash-poor organisations. If you’re a lawyer, you’re giving free advice to people in a pinch.

According to the latest Giving New Zealand report commissioned by Philanthropy New Zealand, for every $1 businesses give in cash they also give an estimated $1.43 worth of sponsorship and $3.27 worth of in-kind goods and services.

My business has found that donating our staff time, advice and skills has been personally and collectively transforming in many ways.  

By allowing staff to give their time during working hours it helps them feel like they’ve made a difference beyond the day-to-day, profit focus of the business. And giving back as a team contributes to camaraderie and a positive work culture.

However, from our experience I recommend proceeding with caution. Once you start donating your team time it’s easy to end up giving way more than you ever intended. When that happens your generosity can become a burden that impacts negatively on your bottom line and drains rather than fulfils your staff.

If you decide to donate time to a good cause, set your threshold. Determine the maximum amount of time you’re willing to give away every year or month. Track it and stick to it.

Practising generosity has many team benefits, but as the boss you need to be firm about turning off the tap when enough is enough.

Arrows are better than scatterguns

Pausing and thinking strategically about where you’ll donate your cash and time will reap huge rewards.

In the early days of running my own business I took a scattergun approach. If I’m honest, if someone asked for a handout I most often said ‘yes’ without thinking. I felt mean saying no to people who could really use my help. I often over-extended myself by doing way too much unpaid work.

In my experience donating a little bit to a lot of different organisations or causes never has the same impact as picking a few good initiatives and putting your weight behind them.

My team has chosen to spend most of our pro bono time helping Waikato Women’s Refuge. This targetted approach allows us to create a much larger impact than if we did bits and pieces here and there.

The same is true when it comes to giving cash: larger monetary donations to one or a few good causes allows you to create immense, positive change where small gifts just don’t.

The first step in honing your generosity is having a conversation with your staff. What causes get them excited? Where do their passions lie? Pick a charity or cause that resonates with them while also being aligned with your business, set your generosity goals as a team, and then determine together with your chosen charity the realistic goals you can help them achieve.

The added benefit of being more strategic in your giving is it becomes easier to say no. The guilt no longer takes over when you can say, ‘sorry, but we’re doing good elsewhere’.

Warm fuzzies depend on you

In the world of corporate giving there seems to be two schools of thought when it comes to telling others what you’re up to.

Often companies donate simply because it’s the right thing to do. They aren’t always looking to increase brand affinity or gain more customers because they’re great givers.

But a lot of the time companies give because they want their brand to be associated with ‘doing good’. When that’s the goal it’s easy to forget that the warm fuzzy brand associations don’t just happen by osmosis. You’ve got to be purposeful in getting the word out.

We’ve certainly found our team getting lost in the ‘doing’ and not taking the opportunity to let people know what we’re up to on the donation front. (Yes, that’s right, even in the PR business we don’t always do this well).

A word of caution, however, is that corporates must keep it humble when telling their generosity story. Nothing grates more than a business shouting about its good deeds. The public will see right through any giving that’s solely for the PR value and not truly from the heart.

My recommendation is to remember to leverage your generosity stories when it’s appropriate. No one else will do it for you.

‘Giving ‘til it hurts’ is bollocks

According to the 2018 Acumen Edelman Trust Barometer, 44% of New Zealanders agree with the statement that “companies that only think about themselves and their profits are bound to fail”.

This statistic points to the fact that giving back is good for fostering a positive business reputation.

But it’s absolutely essential to set a limit. One thing I’ve found from experience is the more your company gives, the more you will be asked to give. Even if you don’t shout your generosity from the rooftops, organisations will somehow find you.

Don’t be a sucker, particularly if you’re a small business. You need to ensure your donation practices don’t break the bank. At the end of the day commercial organisations exist to make a profit. Giving back may be good business, but it’s not core business.

Oh, but there’s a thought: what if giving back is your core business? When that’s the case we call it a social enterprise.

The desire to make generosity our core business has prompted my husband Rod and I to take our corporate donation goals to a whole new level in 2019. We’ve started a charity called All Good Ventures which is helping social entrepreneurs start and build profitable businesses.

Starting this financial year I’ll be donating 100% of my business profits to our new charity. And in the near future my husband will donate dividends received from his business investments as well.

It’s a new adventure in giving for us, but one we trust will create a lasting impression on our community for generations to come. It’s a personal journey we’re starting to move ourselves from donors to impactors.

Heather Claycomb is the owner of HMC Communications, a public relations agency in Hamilton, and is the co-founder of All Good Ventures. She’s a trustee on the boards of The Good Collective, Habitat for Humanity (Central North Island) and a representative on the PR Institute of NZ National Council.


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