5 Questions to Ask When Choosing a Nonprofit Partner

Glancing at most news reports doesn’t exactly inspire confidence on the subject of corporate social responsibility (CSR). Stories often detail companies cheating consumers, running scams, and fattening CEOs’ wallets while leaving employees and consumers to pick up the pieces.

And sure, those companies exist. But the good news is that there are many businesses that build charity and social good into their core mission — and reap the cultural and financial rewards of doing so.

People are becoming more educated and increasingly compassionate about the world around them, which makes them more inclined to support companies that also aim to improve their communities. Research also shows that organizations with strong charitable partnerships can attract more well-rounded and qualified team members.

Partnering with a nonprofit is a great way to give back. Companies can leverage the nonprofit’s expertise in helping those in need while providing funding and marketing to boost the cause. Both organizations benefit from shared resources and joint philanthropic events that boost awareness and positive rapport in their communities.

The Perks of Giving Back

Strong CSR programs provide many long-lasting rewards for the businesses that choose to invest in them; I’ve seen firsthand the symbiotic benefits generated through nonprofit and small business partnerships. Here are a few ways charitable giving and volunteering work for companies:

• Differentiation: Small businesses need to distinguish themselves from competitors. Teaming up with a local nonprofit tells potential customers something about what the company stands for. Differentiation was one of the initial motivations for big companies to develop CSR policies, according to Forbes.
• Employee Engagement and Satisfaction: When staff members are invited to weigh in on potential partnership decisions, they’re more likely to take ownership of the mission. Encouraging employees to participate in company-sponsored events, such as food drives or volunteer sessions at the nonprofit’s site, lets them see the CSR policy at work and instills a sense of pride and meaning in their work.
• “Feel Good” Factor: As a business grows, leaders get to observe the real-time impact they’re making in the community. Whether they’re giving to education initiatives or helping homeless shelters, don’t underestimate the power of the “feel good” factor.

A robust CSR program also adds a powerful component to the company’s exit strategy. The ROI on well-chosen nonprofit partnerships outpaces that of traditional marketing techniques, particularly with targeting local consumers. Potential buyers will be more attracted to businesses that express a strong commitment to the community.

Nailing the Nonprofit Partnership

With countless charitable organizations and worthy causes, choosing a partner that suits your strengths and mission is essential. A company’s CEO may have a personal interest in supporting Burmese refugees, but that partnership will fall flat if it doesn’t resonate with the community. Businesses do well with partners that have missions they can tangibly support through employee service days, joint fundraisers, or promotions.

Roma Boots worked with Linking the World to deliver footwear to children in poor or disaster-ridden areas of Haiti and the Philippines. The charitable mission made perfect sense with the company’s core product: rubber rain boots, which help prevent death and disease in areas where children often walk through sewage, trash, and debris. Aligning your core offering and mission with a nonprofit’s will amplify the benefits of the partnership.

Here are a few important questions to ask when evaluating a potential partner:

1. What’s its mission? The nonprofit’s goals and culture should complement those of the business. A women’s fashion boutique supporting a women’s shelter or a local food store providing meals to underprivileged kids are partnerships that make sense.
2. Is there enthusiasm for the cause? Everyone involved should be passionate about the mission to maximize the partnership’s value. If a particular cause doesn’t excite employees, the relationship — and the potential benefits — will fall flat.
3. How diverse is the nonprofit? The best partner organizations are ones with strong and diverse leadership teams that support a broad network of individuals and other nonprofits. A wide range of funding sources — including grants, state or federal funding, corporate sponsors, and individual donors — indicates a well-run organization. The greater the diversity, the more opportunities there are to reach people in the community.
4. What percentage of donations goes to operations? The nonprofit should have a low percentage of costs associated with operational expenses, allowing the majority of funds raised to go to those in need. Operational allocations typically range between 10 and 20 percent of donations; anything more than that should be a red flag.
5. Is the organization on the financial up-and-up? Audited financial statements with unqualified audit opinions provide clear insight into whether the nonprofit is financially stable. The nonprofit should be registered with the IRS as a 501(c)(3) for the business partner to receive tax benefits.

Successfully collaborating with a nonprofit partner boils down to four principles: integrity, passion, excellence, and commitment. Choosing one that possesses those traits, along with a shared mission, will poise your company to become a champion for social good in the community.

A charitable partnership increases a company’s standing, boosts employee satisfaction, and leads to financial growth. Most importantly, it’s an act of altruism that leverages your resources to serve a cause bigger than your company.