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The latest insights on trends, tips, and idea generating support related to your corporate social investment or nonprofit performance road map to success.

"Are you fully embracing corporate giving?" by Becky Beckman, Gibson

11/22/2019

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As a marketing professional, I have been on both sides of the same equation. As a corporate leader for a global company, I made decisions to ensure our local community was supported by making charitable contributions to worthy nonprofits.  Later, when I worked for the nonprofit Kelly Cares Foundation, this arrangement flipped. I was the one asking corporate executives for charitable contributions to my nonprofit. Now, as the Director of Marketing at Gibson, seeing both sides of the equation and matching those experiences with our own set of priorities has me seeing the whole arrangement from a new vantage point.

As soon as I joined the Gibson team, I asked myself: Are we fully embracing corporate giving? I knew right away, Gibson is an incredibly generous company. It’s very clear we have a culture of servant leadership from the top down and our donations and time prove this. But what difference is it making? Should we have a plan for giving, just like we have a plan for every other part of our company? Of course, the answer is yes.

Research shows nearly 90% of consumers say they’re more likely to buy from a company that supports activities to improve the community. With a statistic like that, do employers really have a choice when it comes to giving and their social reputation? I can enthusiastically say no! But this doesn’t mean throwing together a disjointed giving program that exists outside the bounds of your company’s primary goals.

Does your organization have its core values clearly outlined? At Gibson our core values are genuinely our fundamental beliefs, making it a natural starting point to establish a giving strategy. Your core values should align right along with your corporate giving dollars and time. Next time a nonprofit asks your company for a gift, the first thing you can do is see how partnering with that nonprofit fits into your core values.Leadership must buy into the benefits that come with being a good community steward. Establishing your company as a leader in corporate giving comes with its own set of challenges. You can start today by asking yourself: What is the motivation for my corporate giving? Recruitment, retention, relationships, making an impact? These are all great reasons to take part in giving.

In 2019, Gibson embarked on a path to take our corporate social investment very seriously. We partnered with Blackbird Philanthropy Advisors to measure and monitor our social impacts through surveys, auditing, research, and expertise. Blackbird Philanthropy Advisors sat with us to create our baseline and forge a clear path for future goals that are aligned with our priorities and culture.

During the process we found giving back doesn’t stop at sending in checks and sponsoring tables at charity events but extends into how we are treating our team members and valuing their time and efforts in and out of the office. When the numbers rolled in, we were astounded. When you read through our first-ever impact report or watch the impact report video, both produced in conjunction with Blackbird Philanthropy Advisors, you’ll see we found our company was more generous than we ever even knew. In fact, corporate cash contributions coupled with fundraising, volunteer service, and employee gifts added up to an astounding $869K community investment across all locations last year alone. We also found Gibson has invested in 91 nonprofits and our employees volunteer in 138 different nonprofits throughout Michigan and Indiana. This is resounding evidence the communities we live in need us and rely on us to be there for them in more ways than we ever imagined.

Gibson made a strategic decision—we want to be known as a leader in corporate giving. Looking for ways to innovate through giving, we listened to our employees and offered them the opportunity to volunteer at community nonprofits during the workday. This led to larger groups wanting to participate, allowing us to make an even greater impact while encouraging teams to grow together. In the end, is there really a better way to motivate employees or recruit new talent than being able to show the real impact we are making on those in need, our community, and one another?
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Equally as exciting, I will be working with our current nonprofit partners to get creative. Instead of us supporting that annual dinner with just tickets to an event, we are asking the nonprofits to schedule tours and volunteer opportunities with our employees. We hope this will boost overall engagement amongst our team members and create a peer-to-peer bond that otherwise may never have existed. We are confident this will promote philanthropy among employees beyond what we give here as a company at Gibson.
We encourage you to join us in this endeavor into strategic corporate philanthropy. Be bold and dive deep! As you begin, keep these six quick tips from our partner Blackbird Philanthropy Advisors in mind.

THE DO’S AND DON’TS OF CORPORATE GIVING
  • DO: Think about how you will merge your giving strategy and goals with your corporate strategy and goals. Are there any charities who share a similar vision or mission? For example, if you’re a financial advisor – you may want to look into teaming up with a nonprofit that teaches youth about making smart money decisions. Do you run a construction company? You may consider finding some nonprofits or schools that teach trades to low-income adults.

  • DON’T underestimate the power of relationships you will build through partnerships with nonprofits. If you take the partnerships seriously, you will gain valuable contacts through staff and board member interactions. This is an investment that could impact your bottom line.

  • DO: Ask your employees what their passion is. Imagine spending all your time rallying your employees to support your favorite animal shelter only to find out not a single person you work with is passionate about animal rights. If you find out their passions don’t align with your corporate strategy for giving, consider offering them a matching gift grant to encourage giving to a nonprofit of their choice. On average, major corporations match employee gifts up to about $1,000. Matching any amount, even $100, will go a long way to show your team it’s crucial for the team to be engaged in philanthropy.

  • DON’T forget to provide time for volunteering opportunities to your employees. The estimated national value of an employee hour is $25.43. Even if you’re a small business and can’t afford a big corporate giving program, you can probably afford to offer group volunteering and optional volunteer time off hours for your employees to give back their time. If you organize a time for employees to take the day off to volunteer at a food pantry, that could amount to giving a $1,000 cash donation to that charity.

  • DO: Track every penny you spend on charitable giving. These donations are 100% tax-deductible. Think strategically with every gift -- ask yourself how it will add value to your company. You should be tracking corporate philanthropy just the same as you would monitor any other performance metric in your company.

  • DO: Take the time to get to know the nonprofits you support. You could even organize nonprofit tours and interviews for your employees to help choose the best spot to invest your corporate cash and time. This process should be taken as seriously as any other endeavor you undertake in your business.

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Want to be a better corporate citizen? Here's how to start.

10/10/2019

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If you want to dive into strategic corporate philanthropy, the first thing you need to do is consider your motivation. Is it networking and to generate new leads? To support causes important to you as an executive or your entire team? Is it to position your company as a good corporate citizen because you think it will help you in some other way? It is because it just feels like the right thing to do? There’s no right or wrong answer here. But asking yourself the “why questions” will lead you to the right strategy.

Whatever your motivation is, when nearly 90% of consumers say they’re more likely to buy from a company that supports activities to improve society, then you need to integrate corporate philanthropy into your marketing and sales strategy. (REFERENCE: Creel, Timothy (2012). “How Corporate Social Responsibility Influences Brand Equity.” Management Accounting Quarterly.)

You should also consider the benefits corporate giving has on your staff. Recruitment and retention will become increasingly more dependent on whether your company can give employees the sense their job is making an impact in some way.

No one can tell you how much time or money you should be giving. This is a decision for your executive team and completely dependent on your core values, size, revenue, and business goals. What we can say is that you need to make sure you are being strategic about every effort you make. If you do not take the steps to plan and have a calculated purpose for every donation and volunteer hour, these resources could very likely be wasted. 

Once you know your WHY, the HOW will be more straightforward. Engaging in philanthropy as a HR recruitment and retention tool might lead you to surveying staff on their preferences and capacity. While engaging in philanthropy as a marketing effort might lead you to analyzing charitable giving opportunities as a path to developing relationships that will lead to sales. 



Contact Blackbird Philanthropy Advisors today to get started on crafting a strategy today. 

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Philanthropists, Should You Use a Private Foundation or a Donor Advised Fund?

10/2/2019

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Written by Rob Clarfeld for Forbes
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Americans are a generous people, giving away more than $410 billion in 2017, according to Giving USA, with more than 70% of that donated by individuals. Most people express their philanthropic desires by writing checks to the various charities that are important to them.  Certainly direct giving is easy and convenient, but often lacks tax efficiency or a longer-term strategic focus.

For individuals and families that want their philanthropy to continue for generations or are concerned with income tax minimization efficiency, alternative options to direct giving include setting up a private foundation or contributing to a donor advised fund (DAF).  There are positives and negatives to each.


Building a Legacy with a Private Foundation
For those with multigenerational wealth and the desire to leave a lasting legacy, a private foundation offers a lot of benefits. It adds prestige to the family name and can teach future generations the importance of being charitable and contributing to society. A private foundation also gives the donors total control over which qualified charities receive grants. Family setting up a private foundation can control the succession of trustees and board members for as long as the foundation remains in existence.

On the downside, private foundations are more complicated than DAFs.  They require time-delaying filings and other paperwork to establish them, and there are upfront legal fees and annual maintenance costs for the required tax filings and recordkeeping. Private foundations also are required by law to distribute a minimum of 5% of their assets annually and must pay an annual excise tax of 1-2% of net investment income.  Generally, those opting for private foundations endow them with a significant contribution and have multigenerational charitable intentions.


Let Someone Else Handle the Hassles
Conversely, donor advised funds are established immediately and at no cost, which explains their growing popularity. Most brokerage custodians—Fidelity, Schwab, TD Ameritrade, etc.—can have DAFs set up and running the same day.  Once they are established, the fund sponsor handles all administrative functions. The tax benefits from donations to DAFs also are superior to that of private foundations. The limitation on deducting charitable donations (as a percentage of adjusted gross income on one’s tax return) is the same as for direct giving, 60% for cash donations versus 30% for private foundations, and 30% verses 20% for donated securities.  Also, there is more privacy around DAFs, compared to private foundations that can be researched in publicly available databases, which often creates a flow of unwanted solicitations.  As stated above, DAFs don’t pay an excise tax on investment gains.

A consideration that I’ve found to be more theoretical is that unlike a private foundation, although DAF donors advise on potential grants, the sponsor has the ultimate authority to approve or deny recommendations.  There are also restrictions on what types of organizations are eligible for DAF grants.


Bunching of Deductions
The overarching benefit of both private foundations and DAFs is the ability to control the timing of when you receive a tax deduction and when charities receive funds.  This can make a big difference in a year when one has an exceptionally high income – large bonus, vesting of restricted company stock, sale of a business, or winning the lottery – when charitable deductions are of greater value, and its beneficial to spread out payments to charities over several years.  Both vehicles allow the deduction in the year you gift to the vehicle, while the charities receive the funds in the year you choose.  Further, the recently enacted tax law, Tax Cuts and Jobs Act, may make the “bunching” of tax deductions into a single year adventurous for some taxpayers (See: Preserving Tax Benefits For Charitable Contributions)

Whether the desire to do good results in simply writing a check, contributing to a DAF or setting up a private foundation, maximizing the tax benefits of charitable contributions can be complicated and should be discussed with your tax or financial advisor.



ABOUT THE AUTHOR ROB CLARFELD
www.clarfeld.com
Rob Clarfeld is founder of Clarfeld Financial Advisors, a leading wealth management firm with offices in Westchester, N.Y., and New York City that provides comprehensive financial and estate planning, sophisticated tax and compliance expertise, and investment management services. Rob is a Certified Public Accountant, Certified Financial Planner® and Personal Financial Specialist with more than 30 years of experience advising financially successful families and family-owned businesses. With a focus on robust and individualized family office platforms, Rob has been Barron’s #1 Independent Wealth Advisor in New York for nine consecutive years, and is the #1-ranked New York independent advisor on the Forbes Top Wealth Advisors list. To find out more, visit: clarfeld.com ** Please Note: Rankings and/or recognition by unaffiliated rating services and/or publications should not be construed by a client or prospective client as a guarantee that he/she will experience a certain level of investment performance.

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The DOs and DONTs of Corporate Giving

9/29/2019

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  • DO: Think about how you will merge your giving strategy and goals with your corporate strategy and goals. Are there any charities who share a similar vision or mission? For example, if you’re a financial advisor – you may want to look into teaming up with a nonprofit like Junior Achievement who teaches youth about making smart money decisions. Do you run a construction company? You may consider finding some nonprofits or schools who teach trades to low-income adults.
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  • DON’T underestimate the power of relationships you will build through partnerships with nonprofits. If you take the partnerships seriously, you will gain valuable contacts through staff and board member interactions. This is an investment that could impact your bottom line.
​
  • DO: Ask your employees what their passion is. Imagine spending all your time rallying your employees to support your favorite animal shelter only to find out not a single person you work with is passionate about animal rights. If you find out their passions don’t align with your corporate strategy for giving, consider offering them a matching gift grant to encourage giving to nonprofit of their choice. On average, major corporations match employee gifts up to about $1,000. Match any amount, even $100, will go a long way to show your team that it’s crucial for the team to be engaged in philanthropy.
​
  • DON’T forget to provide time for volunteering opportunities to your employees. The estimated national value of an employee hour is $25.43. Even if you’re a small business and can’t afford a big corporate giving program, you can probably afford to offer group volunteering and optional volunteer time off hours for your employees to give back their time. If you organize a time for employees to take the day off to volunteer at a food pantry for the day, that amounts to a $1,000 donation to a charity.
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  • DO: Track every penny you spend on charitable giving. These donations are 100% tax-deductible. Think strategically with every gift -- ask yourself why questions and how it will add value to your company and the people who make up your company. You should be tracking corporate philanthropy just the same as you would monitor any other performance metric in your company. As we say at Blackbird Philanthropy Advisors, anything worth doing is worth doing well.
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  • DO: Take the time to get to know the nonprofits you support. You could even organize nonprofit tours and interviews for your employees to help choose the best spot to invest your corporate cash and time. This process should be taken seriously just as any other endeavor you undertake in your business.

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Job Ads Referencing Company Support of Nonprofits Can Increase Recruitment

9/15/2019

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Written by Alina Dizik for Chicago Booth. Published June 11, 2018.

A company, if it clearly conveys during the recruiting process its intent to benefit society, can see lasting benefits, research finds. University of Chicago’s Daniel Hedblom, Queen’s University’s Brent R. Hickman, and List used data to track how advertising a company’s support of a nonprofit impacted recruiting and work quality.

To do this, they performed an experiment that doubled as a business venture, which involved launching a data-collection consulting company and hiring 170 part-time workers in 12 US cities. The initial job descriptions they posted were identical, but the researchers tweaked the job details in later emails. When people inquired about positions, they received an email saying the work would consist of either data entry or data entry to benefit underprivileged children. The researchers also varied pay rates, offering some applicants $15 an hour and others $11.

When hired, employees were assigned data-entry tasks that involved looking at Google Street View. Some were asked to tally the number of broken windows or potholes in each image, which produced data that was used in some cases to help identify safe areas near schools where administrators were trying to help students avoid gang violence, and in other cases to benefit Uber. (List is a consultant for Uber.)

Workers who expressed interest in a data-collection company, created as part of a study, were more likely to apply when the position’s social impact was advertised. 1

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Helping schoolkids involved a social impact—and had a big effect on recruiting. When that social mission was mentioned in emails, the company saw 26 percent more people interested in the job, comparable to the 33 percent bump the company saw when it offered $15 an hour. Advertising jobs that had a social mission improved the pool of applicants, with no additional, and potentially expensive, recruiting tactics required. “This generation of young workers is more compelled than previous generations to do social good,” List says.

People who accepted a job originally advertised as CSR-driven were also more effective at work. Employees in the CSR group were more productive, analyzing images in a shorter amount of time than other workers. And while all employees could work any number of hours over a 10-day period, those in the CSR group worked longer hours.

Both women and men were affected by corporate responsibility, but in different ways. Women were 40 percent more productive in accurately analyzing Google Street View images as a result of CSR and worked an hour more per day. Men produced higher-quality results but did not increase the number of images that they analyzed. “Together, these insights suggest that CSR draws out higher output from women and higher quality from men,” the researchers write. “CSR should not be viewed as a necessary distraction from a profit motive, but rather as an important part of profit maximization similar to other non-pecuniary incentives.” Customers and employees, List assures, will still view CSR as authentic, even if it is recognized to boost profits.  

While the results suggest that CSR can have strong, positive effects, List recommends companies keep the findings on moral licensing in mind and monitor employee behavior. He notes that because so much behavior is driven subconsciously, simply making employees aware of the tendency to couple good actions with bad could counteract the bias.

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WORKS CITED
  1. Lea Cassar and Stephan Meier, “Intentions for Doing Good Matter for Doing Well: The (Negative) Signaling Value of Prosocial Incentives,” Working paper, January 2018.
  2. Daniel Hedblom, Brent R. Hickman, and John A. List, “Toward an Understanding of Corporate Social Responsibility: Theory and Field Experimental Evidence,” Working paper, March 2017.
  3. John A. List and Fatemeh Momeni, “When Corporate Social Responsibility Backfires: Theory and Evidence from a Natural Field Experiment,” Working paper, December 2017.
  4. Kai Chi Yam, Anthony C. Klotz, Wei He, and Scott J. Reynolds, “From Good Soldiers to Psychologically Entitled: Examining When and Why Citizenship Behavior Leads to Deviance,” Academy of Management Journal, February 2017.

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4 Reasons to Use Research Data to Jumpstart your Fundraising Plan

8/26/2019

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University of Chicago Booth School of Business’s Rustandy Center for Social Sector Innovation, this guide provides four research-based ideas you can implement today. The Rustandy Center for Social Sector Innovation is the Chicago Booth business school's social impact hub and destination for people tackling complex social and environmental problems. This information is provided by the Rustandy Center in their downloadable e-book here. 

1. The Unit-Asking Method
The unit-asking method works like this: Let’s say your nonprofit is trying to raise money for low-income students. First, ask the donor to think of how much he or she would give to help one student. Next, ask the donor to think about how much he or she would give to support 20 students in need. Using what Chicago Booth researchers term the “unit-asking method,” fundraisers in a field experiment saw donations rise by nearly 70 percent.

The method works best, says Christopher K. Hsee, Theodore O. Yntema Professor of Behavioral Science and Marketing at Chicago Booth, if charities indicate a specific number of people in need—saying, for example, “20” rather than “many”—to give potential donors a better sense of the scope of the situation.
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2. Ask for Help
People like to help others out, but they don’t want to think they’re losing something in the process. By framing supporters’ involvement as helping rather than giving, you can increase what people will do for the charity and how meaningful the involvement feels. Oleg Urminsky, professor of marketing at Chicago Booth, says whatever you do, don’t frame the act of donating as a monetary sacrifice. “If I can just do it without thinking about what I’m giving up, it’s much better.”
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3. Make Your Fundraiser Exceptional
Reframing your annual fundraiser as a unique opportunity can drum up higher donations. Abigail Sussman, associate professor of marketing at Chicago Booth, finds that minor differences in the way a charity frames its donation plea, as either a regular occurrence or an exceptional one, can make a big difference in how likely people are to donate.

For example, researchers altered the wording in online ads for the Alzheimer’s Association’s annual charity walk, so that one ad read “Held annually for Alzheimer’s,” while another read “Only once a year for Alzheimer’s.” People were more likely to click through and donate for the latter, when the walk appeared to be an exceptional rather than a regular occurrence. 

4. Give Suggestions... Carefully
Not all donors are created equal. Whether first-time donor or seasoned philanthropist, offering suggested donations can help guide their giving with positive results.

“Small changes can impact people’s choices, especially for people who aren’t sure what their actual preferences are,” says Urminsky, who is conducting research with Indranil Goswami, assistant professor of marketing at the School of Management at the University at Buffalo. Urminsky and Goswami find that setting higher default donation amounts increases how much a donor gives, but can reduce the number of donors. When targeting likely donors, suggesting larger amounts can be beneficial. If boosting participation is the primary goal, setting a low default can increase donation rates.

When setting default donations, understanding your donors and their commitment to giving is key.
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Why Your Charity Partnership Could be the Main Driver of Employee Satisfaction

8/22/2019

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In an era where the reputation of a business is driven heavily by corporate social responsibility (CSR), charity partnerships have many benefits for corporate companies. Read on to find out how a charity partnership can enhance publicity and improve brand awareness.

Written by: Gary Drew on behalf of HR Technologist. Read the full article here.

The reputation of a business is driven heavily by corporate social responsibility (CSR) these days and is an element that every organization should be growing. This article looks into the importance of charity partnerships and how they allow the ability to differentiate a brand - in terms of status, employability, and value. Of course, this doesn’t mean that you should set up a partnership with every charity that you come across; the not-for-profit organization that you choose to support should reflect your business’ values. 

A Value-Driven Approach
Workers are increasingly seeking employment in organizations that are meaningful to them and are in line with their own values. In fact, millennials have been known to take pay cuts in order to work for a company that is aligned with their own values and purpose.

In addition to attracting and retaining like-minded and motivated employees to your organization, a strong CSR strategy creates a community and gives employees a sense of purpose. It helps humanize corporate organizations and, in some cases, helps to identify a brand’s purpose - giving an idealistic view of how you want to appear to your audience.

Charity partnerships are often more effective and beneficial than donations as they pave the way for new sources of income. The announcements of such collaborations also enhance publicity, leading to improved PR opportunities and brand awareness. Additionally, these types of partnerships can help towards combating national and global crisis situations, such as, unemployment, climate change, homelessness and other issues.

There are many instances that show just how strong a corporate charity partnership can be and the difference they can make. Take SOFII’s fundraising masterpiece, ‘I Wish I’d Thought of That’ as an example. This campaign is based on the alliance: ‘Gay and Lesbians Support the Miners’, which raised £11,000 to support the Miners’ Strike (in 1980’s money) whilst overseeing the first commitment of LGBT rights into Labour Party Policy motion in 1984 - thanks to the block support of the National Union of Mineworkers. The original campaign faced many challenges as it was an attempt to raise funds and encourage support for an unpopular cause, but this just created more awareness than anticipated. 

Despite being an unlikely union, it’s one that all organizations can learn from. When choosing which charity to approach and collaborate with, you should be asking yourself the following:
  • What is my vision and mission?
  • Is there anything your business and the charity have in common?
  • Does it align with your ethos, current workforce and future direction?
  • For the partnership to be successful, it must be mutually beneficial.

What should you look for in a charity partnership?
A partnership is a two-way thing and both the company and charity should complement and benefit from each other in order for it to be successful. It’s important to make sure that the reasoning behind the partnership is also aligned with the customer’s needs and interests.

CSR efforts – as discussed before – help to humanize a brand, which is important as purchasing decisions are often based on emotional reasons. So, if your target market has an interest in tackling environmental issues, teaming up with a charity that supports this cause, will have more of an impact than if you were to endorse a homelessness charity, for example. In addition to a relevant cause, what else should you be looking for in the charity that you decide to team up with?

Enthusiasm and Integrity

The reputation, attitude, and enthusiasm of charity are very important aspects to look for – it is important to strike a partnership with a charity, which shows a willingness to go the extra mile and tenacity to deliver results. Corporate partnerships will play a huge role in the reputation of your business, so it is important to ensure that you are making the right decision. It is not uncommon for charities to be victims of a scandal or crisis and teaming up with an untrusted charity would be a risky move.

Professionalism and Collaboration

The ability to work closely together and align corporate communications in a professional manner is important. You need to know all about your partner’s upcoming news and announcements in advance. If they are planning to carry out a controversial campaign or announce some negative news that might impact your business, it is important to be prepared for press enquiries and interviews, so make sure you have the ability for strong communications and forward planning abilities with relevant contacts.

Long-Lasting Benefits
In addition to having aligned objectives and goals, your charity partnership should also offer long-lasting benefits. It is important that the charity you decide to partner up with can be upfront and transparent about how you can work together and the benefits that they can offer.

Whether this is a dedicated page to you on their website, a chance to be a part of photo opportunities and other public relations opportunities or even invited to corporate events, it is beneficial to work closely together so people (stakeholders and customers) are aware that you are a part of endorsing that particular charity.

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Why Marketers Should Care About Consumer Perception of Corporate Social Responsibility

8/16/2019

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Written by: Elina Trang and YeonJae Choi for AdWeek

In today’s socially conscious environment and political climate when a company takes responsibility for its actions and the subsequent impact on communities, employees and stakeholders, the results go a long way.

This is no secret to companies in various industries. The Sustainable Investment Institute (Si2) recently reviewed the current state of companies’ sustainability reporting and reported that websites of 92% of S&P 500 companies included disclosure on sustainability, with 395 companies (78%) issuing full reports on the subject. The rising role of chief sustainability officers (CSO) is itself an indication for sustainability’s coming of age. In 2000, no one has heard of such a job title in the corporate world, but the role of CSO has become more and more important as consumers expect companies to address their impact on the environment and share responsibility in solving some of the world’s biggest problems.

Further along the road, investor interest in environmental, social and governance (ESG) factors of corporations has also soared. Sustainable investing constitutes a major force across global financial markets. Socially responsible investing has grown by 34% to $30.7 trillion over the past two years, according to the latest report from the Global Sustainable Investment Alliance (GSIA). Responsible investment now commands a sizable share of professionally managed assets in each region, ranging from 18% in Japan to 63% in Australia and New Zealand. The largest three regions based on the value of their sustainable investing assets are Europe, the United States and Japan.
In today’s socially conscious environment, customers are willing to spend more of their money with businesses that prioritize corporate social responsibility.

Multiple facets of the subject of sustainability have been examined by academic researchers. At Kent State University, marketing professor Christopher Groening has been studying different micro- and macro-level conditions through which customer satisfaction and corporate social responsibility affect firm value. Professor Groening launched Corporate Social Responsibility Public Perception Quotient, CSRPPQ. The goal of this project is to collect and analyze consumer perceptions of corporate social responsible and irresponsible activities. More than 36,000 consumers have taken the survey. CSRPPQ can show firms where consumer perception of firm CSR activities differs from firm CSR endeavors. Thus, a firm can understand when it should devote more resources to create greater awareness of their CSR activities. Consumer perception is important to monitor because perceptions drive actions. A firm’s CSR actions affect the consumers’ perception of the firm and their choice of relationship with the firm.

What does this all mean for businesses? In today’s socially conscious environment, customers are willing to spend more of their money with businesses that prioritize corporate social responsibility. Improving CSR business practice and CSRPPQ not only help build a positive brand image, but also have a positive impact on improving customer loyalty and contributing directly to the bottom line, as shown in the examples below.

In spring 2019, IBM’s Chicago office opened its door to the members of the American Marketing Association collegiate chapter. Undergraduate and MBA students learned about ways that IBM differentiates their strategies by focusing on people, process, technology and research in the ever-changing world. IBM especially shared the value they have placed on sustainability and how they are addressing sustainability areas with their technology. IBM has been developing the ways to provide Africa with enhanced solutions to their infrastructure, such as water quality management and healthcare, by leveraging IBM Watson’s capability under the name of “Lucy Project.” With this project, not only is IBM consistently putting efforts into creating further sustainable innovation and new business opportunities, which align with their mission statement, and they are also contributing to sustainable growth of the whole world.

In a different industry but in a similar vein, Patagonia’s recent announcement regarding limiting sales of certain products in an effort to minimize ecological damage bolstered their brand personality: passion toward the environment. The Patagonia Nano Puff Vest, also known as the iconic Power Vest and considered the gold standard of the industry, will no longer be sold to some firms. The company is getting more selective in terms of which corporate sales clients they take because it wants to focus on selling to do-gooder companies, companies with a charity element or those committed to supporting social causes and protecting the environment. With this bold move, Patagonia will be able to convey its core messages to consumers more effectively and develop consumer trust simultaneously by saving the planet audaciously.

The fact that this announcement triggered a market shock shows it already has a strong brand power and identity. Patagonia is also communicating its core brand values, which highlight the beauty of integrity and durability, by releasing a documentary film “Artifishal” depicting the loss of wild fish habitat, which is attributable to human arrogance to nature. Similarly, Tesla’s consistent endeavor to developing the future of zero emissions, such as generating clean energy and expanding global Supercharger networks, has boosted the overall public engagement with the concept of sustainability.

Today’s consumers want companies to be honest and transparent with what they do. In addition to demanding products or services that are accountable for social and environmental impact, they are becoming more aware of the importance of CSR and are eager to be part of it. In light of the shift in consumer preferences toward being more socially and environmentally conscious, concentrating on the theme of sustainable future will offer values to companies and to the society at large. As the business competition is getting fierce and essential natural resources are depleting more rapidly than we expected, corporate sustainability is indispensable for marketers to draw long-term growth and be more competitive.
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CSR and corporate sustainability go well beyond specific concerns about exploiting resources ethically and economically. These are effective approaches for businesses to build long-lasting and genuine relationships with consumers. Many companies have kept abreast of social problems and environmental challenges and turned them into new economic opportunities. They are likely to have a high CSRPPQ, a healthy relationship with their customers. Those with less than ideal CSRPPQ need to spend more effort doing good or make their CSR positions and endeavors are known. In marketing communications such as advertisements or promotional messages, companies need to be aware of and sensitive about environmental topics. Otherwise, they may have a big price to pay from consumer backlash. Overall, communicating your core CSR values and your related actions will help build a more loyal customer base.

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The Journey to Becoming a Philanthropist by Sasha Rabsey

7/30/2019

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Sasha Rabsey is the founder of the HOW Fund and is co-founder of the innovative Present Purpose Network, a group of highly engaged women funders in the US and Europe making critical grassroots grants through informed collective giving. Sasha has a lifelong commitment to giving girls a chance to achieve their purpose in life. Her vision is of a world where all girls are empowered with education and opportunity in order to become their full selves. She consults on meaningful and effective philanthropic engagement for family foundations, individual donors and non-profits. Sasha currently sits on the boards of IDEX (Thousand Currents), Bantwana Initiative and is on the Programs and Services Committee for Exponent Philanthropy.
“Mom, I want to do community service in Africa this summer and I really want you to come with me.” My daughter had been doing community service in San Francisco for years and was ready to take her passion to a global level and she wanted me to be a part of her journey. So, after many hours of research, we found a volunteer organization that placed us in a large village in Ghana where we would work and live in an orphanage with 12 children; 4 of whom were HIV positive. When we arrived at the home we quickly realized how incredibly unprepared we were for the experience. Then the next day all the staff left and there we were, in charge of these children with no protocols and no instructions; just the cook and the two of us. So I did what I knew best and went straight into mother mode. I was amazed not only at the resiliency of the children, but also at my own resiliency.  

I discovered that you can throw all kinds of curve balls at me and I can just sort of manage and not get ruffled. What did throw me off was my lack of direction when I returned home; I felt lost. My kids were growing up and doing a great job taking care of themselves and that both liberated me and depressed me. I really wanted to do something new and the time was now. The trip to Ghana challenged my attitudes and assumptions about poverty and the world in general and I wanted to explore those issues and do something useful. I also knew that defining “useful” was going to take some time.  

It took some self-reflection and inquiry before it clicked. I had the good fortune to benefit from a mixture of hard work and a strong economy and wanted to use some of our resources in a way that would help advance the lives of women and girls. With the help of an amazing mentor, I started the HOW Fund and six years later co-founded Present Purpose Network.

Becoming a philanthropist was harder than I thought. When I began this work I felt conflicted and guilty about my privilege and status. Here I was this wealthy white woman going on site visits to developing countries meeting extraordinary people giving so much of themselves to solve the problems of poverty they faced on a daily basis and I felt like a spectator. These feelings didn’t feel productive but I decided to own them and use them as best I could to serve others. Over time I have found that building deep relationships with grantees creates a bond of solidarity, respect, and trust and through these relationships I have had the most transformative experiences. This is what informs my philanthropy.

For eight years I have been funding international programs working with women and girls engaged in work ranging from: anti-sex trafficking in Vietnam, to mentorship programming for adolescent girls in Nairobi, to community interventions committed to ending Female Genital Cutting in Burkina Faso. I take my time making funding decisions so I can really learn about both the problem and the work being done. It’s a mix of due diligence, site visits, and gut instinct, but the best teachers have been the grassroots leaders I have had the privilege to meet.

After attending conferences for a few years I saw that there were very few grassroots leaders from the Global South participating. It seemed to be all the rest of us talking about them but not with them. In 2011, I started the HOW Fellowship which identifies four 4 outstanding grassroots leaders working with women and girls on issues such as education, sexual and reproductive health, and political participation. The award offers attendance to the Opportunity Collaboration, an annual conference about poverty alleviation that takes place in Mexico. I felt it was very important that these grassroot leaders were contributing to these important conversations with funders and other non-profit leaders.

The participants are also awarded a professional development grant. I have a very broad definition of what that looks like but I’m very strict that the award money cannot go into programming. One thing that I have found to be true of many women leaders is that they are selfless to the point of neglect of their own self-care. They will give everything to the work and leave little for themselves and their own families. A part of the Fellowship is to come to the conference, which is in a beautiful setting, to nurture themselves and to reflect and take time to discover what they want to do moving forward in their work. For example, Mariana from Senegal really wanted to learn more about monitoring and evaluation and after a lot of research she found a week-long workshop in Mali. She received a scholarship to attend but just had a baby and was breastfeeding, so she couldn’t leave the baby at home. She used the development grant to pay for her mother and baby to go with her.  

While attending one of the first Opportunity Collaborations I met Rajasvini “Vini” Bhansali, the Executive Director of IDEX/International Development Exchange. Vini has been a mentor and helped shape my giving. Her mentorship reminds me that the work isn’t about me or throwing money at a situation and then saying, “Look at the impact I’ve had.”  It’s about asking people on the ground, “How can I best support the work you’re doing?”. That support might come from grants, alliance building, or amplifying their work to different audiences. This attitude is what attracted me to IDEX and the best part is that together with their partners they are creating lasting, transformative change. I was so impressed with Vini, her team, and their work that when she asked me to join the board, it was an easy decision.  
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Why do I do this work? Let’s be honest, it’s because it makes me feel good. But I don’t feel good if I am behaving in a way that is anything but collaborative. Yes, I want my grantees to make me look good with their stellar work but they are the experts and my job is to be supportive. To me that means providing funds and establishing a relationship that assumes I will listen, learn and support a partnership in the most respectful way I can. What I know now is that to create a true partnership with these women means that we walk the journey together. The right question, thanks to my dear friend Vini is not “What can I do for you?” but “What can I do with you?”
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The One Approach CEOs Should Take with Philanthropy

7/18/2019

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Want your company to be more involved? Great. Ask your employees what they're passionate about.

​By Tom GimbelFounder and CEO, LaSalle Network@TomGimbel
Published by INC. Magazine on February 26, 2016
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Over the weekend, I joined about 50 of my employees (that's around 1/3 of the company) at Dance Marathon benefiting Lurie Children's Hospital in Chicago. It's an eight-hour dance fest that raised almost $400,000 for the foundation. My company has participated for four years, and two years ago I decided to make us a corporate sponsor.

So what's unique about that?

Our involvement with Dance Marathon didn't start with me. It's not my charity. It wasn't my idea; I wasn't involved at all.

In fact, when one of our employees started promoting it internally, I was irritated because before we knew it, we could have hundreds of emails floating around for any charity, and that can result in apathy due to saturation. 

When I voiced this concern to the employee who sent the email, she told me that she wasn't the only one involved. There were four others. Then five. Then ten.

You get the picture.

So I decided to participate with them, and my kids have joined us almost every year. Last year we had over 30 dancers. This year, over 50.

The point is, I allowed my employees to sell me on their passion. Rather than as a CEO, force my passion on them. In almost 18 years, I've never forced an employee to donate time or money to a charity of "mine."

I've seen too many company leaders make that mistake and force their employees to participate in something, rather than letting them develop a passion.

As a CEO of a high-growth company (doubling sales at least every five years), I ask a lot of my team. They don't have to support my charities. But seeing them get passionate about a charity on their own and working hard to raise money on their own motivates me. It shows me what they are all about -- in their job and outside of it.

The ironic thing is, the people who are the most involved in the charity are huge producers at work. They've all been with the company at least four years and they all work hard. 

I am always a bit skeptical of the employee who wants to only talk about philanthropy, especially when they've only been with a company a few months. But I know that the reason so many employees participated was because it was led by key influencers of our company.

Of the four, only one is in management, so it's truly peers leading peers. It's awesome. Now I'm passionate about the cause, which creates more synergy for them and not so coincidentally has helped business, as well.

Doing well for others doesn't have to be mutually exclusive to helping your business.

So my advice is don't just donate to your own causes; let your employees' passions help guide you. The important thing is giving back, but creating an environment where your employees can lead you is motivating and creates passion.

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Businesses That Give Back Enjoy A Competitive Advantage

7/17/2019

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Our brains are hardwired to serve. Here is why businesses and their employees benefit from embracing meaningful causes.
By Susan SteinbrecherCEO, Steinbrecher and Associates@SteinbrecherInc
​Published by Inc. Magazine, May 31, 2019


At a recent celebration for Harvard Business School's Class Day, speaker Michael R. Bloomberg, extolled the value of graduates aligning themselves with companies that were deeply committed to philanthropic efforts, stating that at Bloomberg, "...philanthropy gives us a competitive advantage in recruiting and retaining talent -- and it's as good for the bottom line as anything a company can do."

Literally translated, the word philanthropy means "love of humanity." By very definition, philanthropy is only philanthropy when it stems from giving without personal gain. It begins and ends with a selfless motive -- that of helping one's fellow man without seeking recognition or reward.

Most of us know that charity is its own reward. The true wealth of charity is measured by good deeds, not ego and material gain. That's why many affirm that they get back far more than they give. In other words, what they receive is the joy of love in action, the manifestation of their gift of time or money in such a way as to make a visible difference.

Interestingly, good people doing good work experience benefits that go beyond just their contentment in the knowledge that they are advancing the well-being of humanity. A well-known study examined the brain activity of a group of people, each of whom was given money ($128) and asked to make choices about whether to keep the money for themselves or to give some or all of it to charity anonymously. The outcome was fascinating. The participants who gave the money to charity experienced an extremely high level of pleasure. The researchers concluded that, "The warm glow that many donors get from giving to charity involves the same brain mechanisms that evoke pleasurable sensations after sex, eating good food, and using heroin or other drugs."

Companies that embrace philanthropic efforts enjoy significant advantages that contribute to the mutual benefit of both management and employees on every level such as:

Loyalty and morale rise.
This occurs in direct correlation to the enhanced sense of personal engagement and connectedness of the employees since they are proud to be associated with a company that cares and does good for others.

Employees experience an increased sense of personal satisfaction.
The reward that goes with being part of a meaningful community effort is something bigger than themselves that makes a difference in the lives of others.

Team building.
This happens at a higher level since all employees are working side by side together towards a common goal.

A sense of accomplishment.
The collective group can work together to achieve something for the community while serving as a profound team-building event for the employees.

We've been taught since we were children that it is better to give than to receive. This Chinese proverb illustrates the intrinsic worth of charitable works:

"If you want happiness for an hour, take a nap. 
If you want happiness for a day, go fishing. 
If you want happiness for a year, inherit a fortune. 
If you want happiness for a lifetime, help somebody." 

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Nonprofit Fundraising and Communications in Times of Crisis and Scandal

5/3/2019

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What happens when your nonprofit is engulfed in scandal? Or what if you have a board member or highly visible donor who’s reputation is significantly on the rocks? As always, being prepared for crisis and scandal is always the best policy. Every nonprofit leader should know when and how to act in times of trouble. Managing these crises is especially important when it comes to fundraising and mission advancement.

Fundraising is all about managing relationships. In times of controversy or not, nonprofit executives should be carefully navigating through their relationships with stakeholders. When there is a crisis, the trust they’ve built along the way will have the biggest impact on successfully wading through the times of murky waters. In general, it is good to have open, honest communication with all of your stakeholders so a crisis doesn’t tip you over the edge but makes everyone come out stronger.

If news breaks that a major donor was engulfed in scandal, a nonprofit executive should remain calm and act swiftly with integrity.  A solution and plan of action to mitigate the crisis should be immediately ready to go. This includes knowing who to pull into a room for immediate strategy, who to contact first, and who are the best people to carry out the plan. Communicating clearly, concisely is paramount.
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Your main strategy will need to be disassociating your mission with the person experiencing the scandal. Your core group of loyal stakeholders should continue to feel that you are an organization they can trust.  Continue to align their passions and initial interest in the work of your organization with the impact and mission you make in the world. The scandal could, in effect, give you an opportunity to engage your stakeholders in a closer, meaningful way that ignites even more respect and loyalty than before. 

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Start Simple: Five Measures to Start Tracking Corporate Giving Impact Today

4/24/2019

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​If you give money to charities and encourage your employees to volunteer, then you should be holding that money accountable. You can start simple to set goals and monitor your impact on the community and your company by starting to track these five measures right away.

  1. ​Number of charities supported financially
  2. Total dollar value of community investment (cash + employee volunteer hours + in-kind + leveraged dollars)
  3. Number of volunteer hours
  4. Number of people in your company who volunteer
  5. Percent of people surveyed who see company as socially responsible

Want to go a few steps further?

Learn more about the LBG measurement tool.

By using the LBG model, measuring your impact from year to year is pretty easy. You track INPUTS (what's contributed), OUTPUTS (what happens), and IMPACTS (what changes). 

Yes, this takes some work but it's worth it. Why are you are investing thousands of dollars into but not measuring where it's going or what impact you're really making? Think strategically with every gift -- ask yourself why questions and how it will add value to your company and the people who make up your company. 

Planned Corporate Community Investment programs has many clear benefits.
  • Strengthen brand recognition and reputation
  • Build relationships with clients, prospects, and community leaders
  • Attain, motivate, and retain talented employees
  • Stimulate innovation and fund new ideas for impact
  • Improve customer loyalty and satisfaction
  • Reinforce your business strategy and values

BLACKBIRD PHILANTHROPY ADVISORS:

We are here so you can be certain you're making an undeniable impact on the world around you.  Our main services center on starting or perfecting corporate philanthropic giving programs (for both corporate giving newbies and veterans). We work smart and use data to determine trends and impact to help set you on a more strategic path in philanthropy. We also provide public relations, special events work, and corporate communications services so you can make sure the good you're doing is recognized.

​Our Philanthropy Management option is perfect for companies who dream of having in-house philanthropy experts but who aren't quite large enough to hire a full time community affairs staff member. Philanthropy management can also be a good addition to your existing marketing teams and can add an expert layer of hands on deck without having to add a full or even part-time position. 

CONTACT US
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Should your company publish a community philanthropy investment / Corporate Social Responsibility annual report?

2/28/2019

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What do Exxon Mobile, Toyota, Coca Cola Berkshire Hathaway, and Apple all have in common? In addition to being some of the most successful companies in world history, they are all also leaders in Corporate Social Responsibility. Entire teams are deployed to build strategic implementation plans to invest in the communities they serve. They develop their community investment plans and corporate philanthropy alongside the highest levels of leadership and produce annual reports to measure, monitor, and report on their social impacts just as they would report on financial returns to investors. 

93 percent of the world's largest companies publish an annual report that details community investment and social responsibility initiatives.

You may already guess we absolutely think every company should have a community investment plan -- but should you also plan to publish an impact report? Don't overthink it. A community impact report could be a small as a quick letter to stakeholders with some facts and figures about philanthropy and volunteerism for year. Or, on the complete other end of the spectrum, you could publish a full multi-page, professionally produced report that holds your company accountable to your commitment to the communities you serve year to year.  

Key questions to consider when building out a Philanthropy / CSR / Impact / Community Investment annual report:​​
  • ​Do you want the report to show full measurements on Corporate Social Responsibility progress or do you just want to report on basic information on community affairs and local philanthropy projects?
  • Will you report details on how you contributed and your policies of why you do it?
  • Will your report provide measured data or just anecdotes?
  • Will your company report on future goals and past practices?
  • Will you include challenges and setbacks as well as good news?
  • Will you integrate the community impact findings into your general financial annual report?

Read more about what an annual report could include in Boston College's helpful "How to Read a Corporate Social Responsbility Report" guide. 


Don't know where to start?
Take a cue from American Express, CISCO, Blue Cross Blue Shield and others in the sample reports we've compiled for you below. When you take a look at the reports, consider all the different ways companies can measure impact, philanthropy, and achieve their financial goals while doing it.
American Express
Bicardi Limited
Blue Cross Blue Shield
Carnival Foundation
CISCO
Lilly Foundation
Samsung Sustainability
Samsung CSR
Target
Wells Fargo
Wyndham
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Measuring your motivations to contribute to the community and charities

2/20/2019

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Motivations matter. They are what drives a company’s Corporate Community Investment. The LBG Framework enables community activities to be classified according to three categories of motivation.
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This analysis provides an indication of the strategic nature of the community program, shows the degree to which it is aligned with wider business goals and helps companies understand the extent to which they are driving their contributions OR are being driven by external demands and circumstances.
 
The three categories of motivation identified in the LBG Framework are:
  • Charitable gifts
  • Community investment
  • Commercial initiatives in the community
 
CHARITABLE GIFTS  
A general response to a charity request for funds
 
Charitable gifts tend to be reactive in that they respond to appeals for help either directly from charities or through requests from employees (including matched funding or payroll giving) or in response to short-term or one-off events.
 
They tend to be ad hoc or one-off contributions, made because it’s ‘the right thing to do’, not because of any strategic aim or anticipated return to the company. Some might refer to this as traditional philanthropy or grantmaking.
 
COMMUNITY INVESTMENT
Targeted investment, long term partnership, major commitment of resources
 
Community investments tend to be more proactive and strategic than charitable gifts. They can center on a smaller number of larger-scale, longer-term projects and are often run as a partnership with, rather than a donation to, a community organization.
 
These projects address the social issue(s) that the company has identified as being relevant to both the company and the community in which it operates. They will often be: linked to a wider community strategy; be measured; and be expected to help protect the long-term corporate interests and reputation of the business.
 
COMMERCIAL INTIATIVES
Primary purpose PR/ marketing, business development, or promotion for competitive advantage
 
Commercial initiatives in the community are business related activities, usually undertaken by departments outside the community function (e.g. marketing, R&D), to support the success of the company and promote its brand and other policies, that also deliver community benefit.
 
The most common example of this is cause-related marketing. These are primarily marketing campaigns but involve a contribution from the company to a charitable cause. 
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How can you become an Impact Business?

12/15/2018

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​Written by Julia M. Profeta Johansson for the Twenty Thirty Blog: 7 Ways to Rethink Your Business through an impact lens.

There are three big questions that you can ask yourself to kick-start the process to become an Impact Business:

  1. Is my business harmful?
  2. Is my product/service needed by society?
  3. Does my business somehow relate to the Sustainable Development Goals (SDGs)?

If your operation somehow already relates to one of the topics, the first step is to identify a specific target within that topic that you can intentionally improve through your business. The next step is to create a strategy with defined indicators, so you can measure your progress towards that target.

Please note – simply working in an industry related to these topics does not guarantee that you are generating positive social/environmental impact. Unfortunately, this is something that we see happening more and more: people claiming to be impact businesses just because the business is in education or healthcare, for instance. We saw a lot of “green washing” back in the 2000s, when the topic of environmental sustainability became trendy. Now, we are at risk of seeing more “social washing.” That’s why in my previous article I recommend starting slowly and not getting attached to labels. 

It can be a long way to really become an impact business, especially if you are not a start-up, but it can be done. And you have to start somewhere.

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Going back to our process then, the following workflow may help to guide you through this thinking process of understanding where you are now and what are the first steps you can take.

  1. Based on my skills and knowledge, can I reinvent my company thinking about the innovations needed for a brighter future?
  2. Meanwhile, how can the harm be minimized? Companies that aren’t beneficial for the world need to cease their harmful operations. There is a lot of potential to redirect the development path of a company using most of the same resources for other purposes.
  3. Based on my skills and knowledge, can I reinvent my company by thinking about the innovations needed for a brighter future?
  4. Is there anything I could start doing to help reaching the SDGs?
  5. If my operation/core business somehow relates to the SDGs, which target(s) could I include in my strategy?
  6. Do certain social/environmental problems occur in the surroundings of my company? Through my business, can I help solve them?
  7. What is my power in the value chain? Can I help and shape standards, in order to promote more social/environmental impact?
  8. Can I better choose my clients through a positive screening?  For instance, in the financial industry, as a wholesale bank, what can I offer or ask from my clients? If my clients promote some kind of social impact, could they have a better pricing on credit and other financial products? After all, more social impact normally results in less risk…There are already banks doing this.
  9. Could my product serve other markets/clients that would highly benefit from it?For example, if I am in the consumer goods sector, or education, or healthcare, could I make my product and/or services accessible to less obvious clients? Is there space for some kind of cross-subsidy?
  10. Can I improve quality and/or access?  Is my product fair enough for the quality I offer? Or could it be better by refocusing on the beneficiary? Establish metrics to understand better whom you are serving and if there is room to refocus your strategy, like geographic reach, client profile, potential side effects generated…
  11. Can I partner with others in my industry to reach unreachable clients or solve issues that no one has enough resources to solve alone?
  12. Is there anything I could be doing to help reach the SDGs?
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After thinking about all these questions, there is a tool that can be helpful in framing the impact vision of the business and figuring out which KPIs, on an operational and impact level, will help move the business towards that vision.

This tool is the Theory of Change.

Theory of Change is a framework to define the impact vision of a business. It considers 3 different layers: inputs, outputs, and outcomes. Analyzing its inputs (products, services, etc.), it is possible to understand the outputs and design the desirable outcomes of the operation. Simply put, determine operational indicators in relation to what’s core in your operation (outputs) that in turn will lead to more in depth indicators, the outcomes, which should be the true impact generated, reflecting the impact vision of the business.
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The questions to ask when rethinking and repositioning a business, through the impact lens, are practically endless, but I hope this article has provided a starting point if you are interested in the topic.

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Written by

Julia M. Profeta Johansson is an impact investing and venture capital specialist based in Berlin, Germany. Julia was previously a partner at Vox Capital, the first impact investing fund manager in Brazil. Before that she also worked with Yunus Social Business, Rocket Internet, Itaú BBA, and Mundo InNova. She is more than happy to continue this conversation and help your business start this journey of more intentional impact.

Read more from Ms. Johansson on the TwentyThirty blog. 
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Blackbird Philanthropy Advisors featured in Yahoo! Finance article on "How to Start a Nonprofit"

12/4/2018

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If you're passionate about a certain issue or cause, you may decide to go beyond donating your time and money to a charitable organization and start a new nonprofit.

But before forming a nonprofit for personal fulfillment, there are a few crucial financial and logistical steps to address, including financing and taking advantage of tax exemptions to ensure the organization can solely focus on its core mission, not unnecessary expenses. You'll also want to consider whether you have the time to start a nonprofit, and if you'll need to be paid for the time you put into creating and operating the organization.

Choosing whether or not to receive a salary is one of the fundamental differences between launching a nonprofit versus a for-profit business. With a for-profit business, you can earn as much as your business can afford to pay you; with a nonprofit, if you generate more than what the IRS considers "excessive," you could pay an excise tax and lose your tax-exempt status.

So, if you're contemplating forming a nonprofit, there are a number of factors you'll need to consider to meet your organization's goals. With that in mind, here's what you need to know to get started.

Research the prospective charitable cause. Conduct a competitive analysis to determine if there are other organizations addressing the same issue. If there are competing nonprofit organizations, it doesn't mean you shouldn't start a new nonprofit, but you do want to know the lay of the land, says Caitlin Worm, managing director of Blackbird Philanthropy Advisors, a nonprofit based out of South Bend, Indiana, that works to help businesses be strategic about their philanthropic giving.

"If you can't find anyone doing the same exact thing, it could be a good sign, but maybe you can find an organization that does similar work and help them build a program to help your intended population rather than building a new organization from scratch," Worm says. "It's always a good idea to make sure you are not replicating services already being offered at satisfactory levels. ... For example, if you want to start a food bank, you may want to do a search for food banks in your community and find out what works and what doesn't work before you start a new one on your own."

Consider incorporating your nonprofit. The process varies by state, but you'll likely need to register your nonprofit with your secretary of state's office, which typically requires a filing fee (in Ohio, for instance, it requires a $99 fee). You'll also want to choose a corporate name for your nonprofit.

Weigh the pros and cons of tax-exempt status. If you've done your research, and you're certain that there is a need for your nonprofit, you'll want to make sure the IRS agrees.

James Hsui, a New York-based attorney who specializes in offering legal advice to nonprofits, says that most nonprofits that are exempt from taxes are under Section 501(c)(3) of the U.S. tax code. "However, Section 501(c)(1) to 501(c)(29) all describe tax-exempt entities that could be classified as a nonprofit, and it is also not a requirement for nonprofits to be tax-exempt," Hsui says.

How do you decide whether or not to file for tax-exempt status? Whether you seek out this tax exemption is something you should discuss with an attorney like Hsui, but assuming you're going to form a 501(c)(3) nonprofit, you'll be involved in a two-step process. First, you'll need to form the nonprofit as a corporation, trust or unincorporated associated with your state. "For most nonprofits, the corporation is often the best option because it provides the broadest amounts of liability protection for its directors, officers and other insiders," Hsui says. "Once the underlying entity is established, the next step is to apply for the entity to be recognized as a tax-exempt 501(c)(3). This involves filing either Form 1023 or 1023-EZ with the IRS."

The latter form is faster, but if you expect to receive more than $50,000 in annual gross income for the next three years -- or you're starting a church or school -- you need to fill out Form 1023, Hsui says.

"If everything goes well with the application for recognition, the entity will receive a favorable decision letter usually somewhere between two weeks and nine months," Hsui says. He adds that the time it will take to hear back from the IRS will depend on factors such as what type of form was used, the current backlog of applications, the complexity of the nonprofit's activities and whether any issues of concern were found by the officer examining the application.

"I highly recommend hiring a lawyer, tax advisor or business consultant to help you walk through the steps of the form correctly the first time or you could risk having your application rejected or sent back for revisions," Worm says. "There are horror stories of these revisions and resubmit processes taking months, if not years, to complete because of minor errors on the application."

Assemble a board of directors. If you're serious about starting a nonprofit, you'll need a board of directors. In fact, when you register your charity, you'll need to provide the IRS with names of three individuals who are your board of directors. Also, keep in mind the IRS prefers that the organization's board of directors are unpaid. You are allowed to have more than three board of director members, but experts suggest making sure your number is uneven, so when you have big decisions, such as how to spend money, you won't have a tie.

Remember: Nonprofits require financing. Starting a nonprofit is tough enough, but running it indefinitely isn't easier. You'll need to have an interest in raising money or your board will need to be passionate about it. It's also beneficial to have a business plan. You'll want to create a road map that shows a fundraising and operational plan, and include an executive summary to entice organizations and foundations to offer grants for your nonprofit.

"Startup nonprofits need to have board members who will aggressively and unashamedly lead, bringing in donations and other influencers that can help the nonprofit grow and get the traction that will lead to a healthy, sustainable inflow of donations," says Peter Dudley, chief development officer of Cancer Support Community San Francisco Bay Area.

That's because fundraising will be a big part of your nonprofit's existence. "I've seen a lot of nonprofits struggle with cash flow because they underestimate the amount of time it takes to bring in donations. People passionate for their work often think that passion will translate into donations, and they also think that if a person will donate to this, then they will donate now," Dudley says.

But it doesn't always quite work out that way. "In reality, a lot of people who are willing to donate will need to be asked several times, over a period of time, before writing that first check," Dudley says. "People often will also want to see some traction or a critical mass before writing bigger checks. They'll donate $25 or $50 but will wait until you're established before giving at a personally meaningful level."

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​Michigan Women Forward launch $10 million offering to support women entrepreneurs

11/22/2018

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Written by: Sherri Welch

Detroit-based nonprofit Michigan Women Forward will offer $10 million in community impact notes to support Michigan's women entrepreneurs.

Over the past five years, MWF (formerly known as Michigan Women's Foundation) has used philanthropic contributions and money from the state loan fund (that had to be paid back in just three years) to make microloans to 180 women entrepreneurs through loan programs and pitch competitions.

About 90 percent of those investments have been in Southeast Michigan, the rest scattered around the state. The businesses range from drinking vinegars and a coffee shop, a hydroponic farm and a mushroom factory to an architecture firm and a phlebotomy training school.

All but four of those companies are still operating, Cassin said, noting they collectively produced $18.5 million in revenue last year.

With the additional "patient" capital from the new offering, MWF could invest in up to 1,000 additional women entrepreneurs, giving them longer terms to pay the investment back, along with technical assistance and other support to help them succeed, Cassin said.

"If these businesses perform at the same rate the first 180 have performed," the notes could create $100 million in new revenue when it is fully deployed in 10 years, she said.

"It starts to be significant. You start to talk about real impact."

The $10 million Michigan Women Forward Community Impact Note offering is modeled after a similar program the Maryland-based Calvert Impact Capital Inc. offers to fund microloans, or make loans for buildings such as schools or affordable housing, Cassin said.

MWF is seeking:
  • $6 million to fund microloans to women-owned businesses in the state
  • $3 million to fund a new, Detroit headquarters for MWF that will also serve as home to a women's entrepreneurship center and the Michigan Women's Historical Center and Hall of Fame, acquired by MWF last year.
  • $1 million for a new equity fund to enable MWF to begin making higher-risk, equity investments in a handful of select organizations as a pilot for a larger fund.

"Before you're ready for angel investing or venture funding, women, especially, have a very hard time finding small amounts of equity funding," Cassin said.

Issuing notes is contingent upon MWF garnering commitments totaling at least $1 million within 12 months. Individual investors must make a minimum investment of $50,000, and institutional investors must commit at least $500,000.

MWF promises returns of 1 percent for five-year notes, 2 percent for seven-year notes and 3 percent for 10-year notes.

With assistance from Auburn Hills-based Gingras Global Group Inc., it will also provide investors with quarterly impact statements to document the tangible impact they are making in women's lives, Cassin said.

All summer, MWF has been talking with local, private and family foundations and banks "that might want to turn a philanthropic donation into an investment" that could be redeployed again and again to help women entrepreneurs, Cassin said. "We would not have gotten this far if we hadn't received positive reinforcement from them," she said.

MWF has also been talking with foundations in other parts of the state, such as Grand Rapids, that have an interest in investing in the notes to support women entrepreneurs in their regions, Cassin said.

Beyond the support the new offering could bring to women entrepreneurs, microlending is a sustainable business for MWF, Cassin said.

"The more we lend out and (entrepreneurs) pay back ... that gives us this opportunity to really create a larger and larger pool of money we can access" for more microloans, she said. "That's better for getting more women the capital they need and for getting us more flexible, earned income to start paying for the organization instead of having to go out and fundraise all the time."
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Three Ways to Help Kids Become Agents of Change

11/21/2018

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By Dina Buchbinder
This article first appeared on the Twenty Thirty blog here. ​

​Children are the changemakers of tomorrow – if we encourage them to be their most innovative and creative self. Dina Buchbinder wants to give children an education that not only prepares them for their own future but also makes them agents of change for their communities and beyond. This is how everyone can get involved.

Anyone can be an agent of change, and it is up to everyone to promote community development and active participation. With the 2030 Agenda for Sustainable Development including its 17 Sustainable Development Goals the United Nations provides a comprehensive framework for equality and development. Sustainable Development Goal #4 specifically seeks to promote equal access to quality education. We can all contribute to ensuring not only a quality education but also one that is meaningful for girls and boys around the world.

At my organization, Education for Sharing, we view students, regardless of age, as able to, ready to and passionate about identifying and tackling problems in their own communities. We refer to our Education for Sharing students as changemakers, because we work with the students and entire school ecosystems to equip all students with the skills to improve their own communities through action.

Here are three ways how you can unleash the power of play to form young agents of change in your community:

1. Understand your community.
What problems are the children from your local community facing? To build a connection with children, it is imperative to understand the unique context framing their perspective. Talk to them and to other community members, visit community centers, and learn more about the daily problems they are facing and the solutions they come up with. Even if you have been a part of a community for most of your life, there is always something to learn, especially from children. Learning with your community will allow you to develop a sense of shared vision about what needs to change. Get started!


2. Walk your talk.
Promoting civic values – such as teamwork, empathy, respect, tolerance, responsibility, fairplay, inclusion – is most effective through demonstration. Many community organizations welcome the assistance and support of community volunteers to work with children. Be it your local Boys and Girls Club, YMCA, or Big Brothers Big Sisters, every community has a need, and you can be the example children need to look up to (you will be surprised how much you will learn from them in return).

3. Get moving.
Ninety-one percent of American children have poor diets and less than half get the recommended 60 minutes of daily physical activity (Better Policies for a Healthier America). Globally, 81% of adolescents aged 11-17 years were insufficiently physically active in 2010. Adolescent girls were less active than adolescent boys, with 84% vs. 78% not meeting WHO recommendations (World Health Organization). It seems as if technology has completely taken over, and children are spending increasingly less time outside. 

Physical activity and play allow us to know ourselves and our communities better. Being outside and engaging in physical activity invite us all to communicate better to encourage cooperation, and to engage more. It's also a tool for expression and action. As Nelson Mandela said, sport has the power to inspire and unite, to create hope. Encouraging girls and boys to discover the outdoors will enable them to see a world beyond the internet and unleash their potential to improve their own communities. Play outside with them!

These are a handful of ideas to get involved in your community in an effort to promote the formation of young, active citizens. There are many different ways to make global change at a local level, and ultimately each one of us is in a position to affect that change. Change starts with you! How will you contribute today? On your mark, get set, go!



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How much of a charity donation can you deduct on your taxes?

11/21/2018

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The closer details of charitable deductions on taxes only matter if a person is itemizing deductions on their tax filings. If so, you are able to deduct contributions up to 50% of your adjusted gross income when they are made to qualifying 501(c3) entity or other qualifying organization. Some organization types only qualify for a 30% limitation private foundations, others qualify for a 60% limitation (federal government units).

If you’re concerned with the tax-deductible status of your donations, you may request verification from the charity of your choice (ask to see a copy of their latest IRS 990 or a copy of their IRS 501(c)3 determination letter). You can also use irs.gov or guidestar.org to search for documentation.
 
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What can and can’t be deducted?
 
In order for a donation to be deducted, it needs to be truly charitable. No goods or services can be received in exchange for the donation that is considered tax-deductible.
 
If you attend a charity dinner and paid $500 for your ticket, you’ll need to find out how much was spent on the meal and beverages you received because you are only allowed to deduct the amount that exceeds the cost of your event attendance. Similarly, charity concerts, golf outings, and auctions are all types of events when your full donation amount may not count toward your charitable donation. You may pay $500 to play in a charity golf outing but find out that the charity spent $300 per player for gifts and greens fees. In this case, you would only be able to deduct $200, not the entire $500 you spent.
 
It is up to you and your accountant to determine this amount by coordinating with the charity. If the charity is doing their job correctly, they will make it easy for you by adding it to the gift acknowledgement. For example, it should read: “$100 contributed. $60 total deductible donation after receipt of goods and services.”
 

 
Do people need to keep track of receipts?
 

Everyone should keep careful track of charitable contribution receipts, just as they would any other household or business expenses. Most nonprofits have a donor database system to keep records on gifts though and should be able to print you a new one should you lose yours. Some nonprofits will mail out a statement of giving around January or February each year which will include a complete history of your giving for the year – this document can be used for accounting purposes in place of the receipts of each individual gift you made to them that year.
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Blackbird Philanthropy Advisors Featured in Cheapism Article on "How to Get Tax Breaks Through Charitable Donations"

11/11/2018

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READ MORE ON CHEAPISM.COM BY MIA TAYLOR
GET TO GIVING
As the clock winds down on 2018, many people are scurrying to make their final charitable donations of the year and tally up ones already made. In 2017, Americans gave $410 billion to charities, an increase of five percent over the previous year. For those looking for ways to make the most of charitable donations before the end of the tax year, here are some tips and insights from experts around the country.

KNOW THE NEW TAX LAWS
Under the new tax laws recently adopted, the standard deduction for filers has roughly doubled. It’s now $12,000 for single filers, $18,000 for head of household, and $24,000 for joint filers. Those increases will likely have a profound impact on people’s interest in making charitable donations. “If you’re taking the standard deductions, you cannot itemize,” explains Mark Charnet, founder and CEO of American Prosperity Group. “That’s going to horribly dissuade people from making charitable donations. Unless they itemize on their taxes, they will not get a reduction on their tax bill for the charitable contributions and therefore will be disincentivized to make donations.”

KNOW HOW MUCH YOU CAN DEDUCT
The law generally allows for deducting contributions up to 50 percent of your adjusted gross income, when such contributions are made to qualifying 501 (c)(3) entity or other qualifying organization, explains Caitlin Worm of Blackbird Philanthropy Advisors in South Bend, Indiana. “Some organization types only qualify for a 30% limitation, such as private foundations,  while others qualify for a 60% limitation, such as federal government units,” says Worm.

RESEARCH WHERE YOUR MONEY WILL GO
If you’re planning to donate to a non-profit organization, otherwise known as a 501(c)(3), find out how your contribution will be used. How much will go toward the cause and how much goes toward administration? A variety of third-party evaluation and ratings sites can help with this effort, such as the Better Business Bureau’s Wise Giving Alliance, Charity Navigator, and Charity Watch, which review a charity’s finances, governance and effectiveness. “Better ratings will indicate that the organization allows for the majority of the donations to go right to the cause,” says Jacob Dayan of Community Tax.
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Five Ways to Teach Children Philanthropy

11/7/2018

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1. Start Early! 

Teaching children philanthropy can start at a very early age. Lessons related to cooperation, compassion, kindness, sharing, and contributing to a family, school, or neighborhood all teach the foundation of philanthropy.

2. Time, Treasure, Talent 

It’s important to teach children of all ages that we all have time, treasure, or talent to share with the world. If you start with the framework of time, treasure, talent, you can easily incorporate that into helping children understand their unique attributes and capacity to give something to others who would otherwise go without. Kids are naturally altruistic -- it is up to adults to teach them how to act on their altruism by showing them ways they can volunteer time, give away toys or food, and share their talents for the benefit of others.
 
3. Needs vs. Wants
 

If you start by teaching your kids about needs versus wants, they will understand that not everyone has extras and many do not even have enough to cover needs. A big part of teaching philanthropy to children is also teaching them to be grateful for what they have. You can talk to them about what it might be like to have less or to have more and ask them to think about how other people live.
 
4. Be a Role Model


Children learn best by experiencing and modeling what they see their loved ones do. A great way to teach children philanthropy is by devoting yourself to giving back. You can invite your children along to charity events, to donation drives, and sometimes even volunteer service opportunities.
 
5. Reinforce Kindness 

When you see your child expressing concern or kindness for others, encourage them and show them that you are proud of how they reacted. This will reinforce their behavior so they have a positive association with kindness and empathy. 
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Blackbird Philanthropy Advisors Featured in New Small Business Accounting Survey Report

10/24/2018

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​Small businesses should create a budget, according to a new survey report from Clutch, a B2B research firm in Washington, DC.

Blackbird Philanthropy Advisors’ Managing Director, Caitlin Worm, provided expert commentary on the data, based on her experience counseling nonprofits and small businesses.

The survey found that 61% of small businesses did not create an official, formally documented budget for 2018.

Small businesses may have skipped a budget because creating one seems restraining or intimidating. Perhaps they believe that it’s impossible to stick to a budget considering the daily obstacles small businesses face.

Yet, the survey also found that exactly half of small businesses that did budget were able to stick to their goals for quarter one and quarter two 2018.

Businesses have a bit more flexibility with their budgets than households, Worm explained.
 
“Business owners need to keep in mind that a budget is just a plan,” Worm said. “Sticking to a budget does not always mean the same thing in business as it does for a household. In a business, the potential to generate revenue has fewer limits than a household budget where one or two people earn a fixed salary.”

Clutch’s survey did find that more than one-third of small businesses with a budget (37%) spent more than they planned in the first half of the year.

This doesn’t necessarily mean these businesses are in trouble, though.
 
“Overspending is not always bad – there may be investments that cost more early on than expected but will pay off in the near future,” Worm said. “Also, many times, spending more than budgeted could also mean that far more revenue was generated than expected – in that case, more expenses could be a good thing.”
 
For businesses beginning to budget for the first time, Worm recommends caution.

“New business owners tend to overestimate their potential to generate revenue quickly,” Worm said. “It’s actually better to underestimate and be ultra-conservative, than to be overly confident. Basically, try not to overestimate the amount of money you think you’ll receive. It’s far better to budget conservatively and end up with more money than you planned for, rather than to fall short.”
 
When budgeting, consider the goals you’d like to reach, as opposed to just random numbers.

“When creating a brand new budget, you need to have some specific, realistic goals in mind,” Worm said. “These can include: ‘To break even in Q3’ or ‘To have ten customers paying $10,000/year or more by end of the year.’ The budget should tell a story of how you will run your business and what goals you want to achieve.”

Read Clutch’s full survey report here.

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Can you deduct volunteer service on your taxes?

10/17/2018

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Many people wonder if their volunteer time at a charity completing professional tasks can be deducted on their taxes. You cannot deduct the value of services rendered in volunteer service to a nonprofit. You can, however, deduct the expenses you incurred while volunteering or traveling to and from the volunteer assignment.
  • Gas mileage (at the rate of $.14/mile), public transportation costs, and airfare or train travel to farther volunteer destinations or conferences can all be deducted. Meals and lodging for longer distance volunteer assignments may also be deducted.
  • If you’re required to wear certain type of shoes or outfit, the purchase of those items may be deducted.
  • Out of pocket expenses (ie. books, materials, copies, supplies, etc.) can also be deducted as charitable contributions.
  • Save your receipts and ask the charity to verify the expenses as an in-kind donation if the total adds up to $250 or more for the year, otherwise you're able to claim in-kind donations up to $250 as a tax deduction.

Example 1 - The Artist:

An artist who paints a mural on the wall of her local local Boys & Girls Club can deduct the cost of paint, paint brushes, and other supplies needed to complete the mural. She can also deduct the gas mileage it took to get to and from the charity to complete the volunteer service. She cannot deduct for the time it spent her. 

Example 2 - The Nurse:

A Red Cross volunteer who is a Registered Nurse travels to Florida to help with hurricane disaster relief recovery. He can save the receipts for his airfare, lodging, and meals while on assignment. He cannot calculate the hours he spent working as a nurse for Red Cross and deduct the pay he would have been paid in his workplace.

Always consult with your tax advisor to be certain. 

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Bethza Studio + Salon J Domestic Violence Awareness Donation Drive

10/11/2018

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Bethza Studio and Salon J in Elkhart, Indiana will hold a month long donation drive to collect supplies for women at the Safe Haven Women's Shelter. They are asking community members to drop off feminine hygiene products, gently preowned purses, undergarments, cleaning supplies, and soaps from October 10 through November 8.

There will also be a special event raising awareness for victims of domestic violence and additional funds for the women's shelter. The live event will take place on Thursday, November 8th at Bethza Studio in downtown Elkhart. There will be a professional photographer, music, door prizes, hair styling, brow shaping, lashes (strip), mini makeovers, and more available on-site from 5:00-8:00PM for donations only. Donations of all amounts in exchange for the services offered are welcome and will be collected at the event.

Salon J Donation Goshen Drop Off:
130 Main Street
Goshen, Indiana 46526

Bethza Studio Donation Elkhart Drop Off:
201 S. Main St.
Elkhart, Indiana 46516
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