We'll discuss investing in nonprofits. That’s right -- investing in nonprofits. But not in the ordinary sense of investing. In today’s environment, corporate chairs and CEOs face a complex challenge in communicating their message and keeping their employees, customers, and stakeholders focused. I’m sure many of you recall Abraham Lincoln’s telling words, "You can make some of the people happy all of the time. You can make all of the people happy some of the time. But you can’t make all the people happy all the time." With so many publics, many of whom overlap or even conflict, taking a stand often means you take the heat for making the decision, any decision.

Wouldn’t it be wonderful if you had a tool which could align your employees with your corporate mission? Or how about a tool which could provide more favorable media exposure? And how about a tool which could develop future markets without the heavy upfront expense and long-term investment necessary to fend off your competitors? 

Investing in nonprofits is that powerful tool.

It connects your corporation with your current and future customers -- translating into profitability. It builds goodwill -- translating into profitability and alignment with your mission.

And it speaks to the character of your corporation -- through deeds based on your corporate mission rather than words merely based on next quarter’s projections. That needs no translation. So let’s take a look at three key elements you must consider before you give the decision to go ahead. They are: relevance of investment; full focus on the nonprofit; and the low-key promotional approach.


First, your investment, your support, must be relevant. 

Why? A relevant investment makes sense in people’s minds -- they won’t question your intent. Irrelevant support looks as if you’re trying to advertise for customers. Or worse, as if you’re trying to pull a public relations trick off on the public. I emphasize trying, because a relevant investment looks like a natural fit. In irrelevant investments, your intent is too obvious, and people know it immediately. You’ll generate negative goodwill, or distrust of, your company. Now, not only have you lost your investment. It has become a debt that will cost you customers, sales, and profits -- for years to come.  Here’s a hypothetical example. Years ago, a super oil tanker named the Exxon Valdez ran aground in the pristine waters of Alaska.. Imagine the Exxon Corporation quickly reacting by supporting the Nature program on public television, with a statement at the beginning of the Nature program that Exxon is committed to providing natural energy resources for our growing global needs while preserving our natural heritage. I wouldn’t buy that. Would you? I didn’t think so. What does work? In the past, I helped the Honolulu Symphony. United Airlines was sponsoring a concert series where one of the concerts featured music from George Gershwin, and included his piece called Rhapsody in Blue, the same United Airlines was using as its theme on television commercials. Of course, United picked Gershwin and Rhapsody in Blue. But their promotions did not point to that behind-the-scenes decision making. 

Cute, smart, and done without blatant self-promotion. More people associated upscale markets, symphonic music, Gershwin, and Rhapsody in Blue with United. The goodwill generated from their investment increased corporate travel accounts and revenues. And since the Symphony audience had many corporate decision makers, it was a relevant target AND a relevant promotion. 

Another example of what does work is more general in nature. Today, you can find statements on products that a fixed portion of revenues, usually a percentage such as 2%, is donated to a specific organization, such as The American Red Cross or a category such as nature preservation. The corporation links themselves to a identity other than just the product manufacturer or service provider.

For example, instead of, "They make fruit juices," people recognize that "they’re the guys who’ve been providing free meals to low-income school children." With relevant support, you will build goodwill. Before people find out what your corporation sells. So they begin with a favorable first impression. And as the expression goes, "You don’t get a second chance to make a first impression."

If your investment support must be relevant, it also must be fully focused on that nonprofit. It’s a gift to the nonprofit-- not a business transaction. 

And gifts are given with no strings attached. 

Unlike a business transaction in which a seller sells a computer system and the buyer gives the seller a lump sum check for $1 million, the benefits that come about from a nonprofit investment trickle in over time. Managed correctly, the value of that trickle of benefits can be greater than the $1 million lump sum. And that’s the idea. Yet the main focus should be on giving rather than the receiving. The goodwill generated is what your corporation gains in return. And goodwill is the trust that brings customers back to buy again, to tell their friends and family about their positive experiences -- even to defend the corporation when the product or corporation is brought into question.

Remember the beer commercial: "Tastes great! Less filling"? That’s what you want from your customers when they defend your corporation’s products. A good starting point for you would be to review your corporate mission statement to see why it exists and who it serves. In interpreting who it serves, extend that definition to those in the nonprofit communities and find a match. That will make viewing investing as a gift much easier, since the investment will go to those it already serves as a business. 

If selecting the right nonprofits to invest in is essential to receiving a return on your investment; and if focusing on benefiting the nonprofit starts that return streaming in...

...then how you let the world know about your investment is our final focus. 

The low-key approach is the strongest. 

Be aware: The low-key approach does take patience -- and courage. It’s similar to implementing a culture change or redefining a corporate mission. Only much, much faster! Remember, the return on your investment trickles in over time like interest on money in the bank, rather than all at once up front like selling a blouse or a pair of pants in a retail store. Setting the tone starts from the beginning, in the cover letter confirming the investment contribution following your conversation with the nonprofit’s executive director:  

Further the process by announcing your investment in a rollout -- first to employees -- then to customers and vendors -- any other stakeholders, such as investors and analysts -- and finally to the general public. 

Promote your nonprofit in your various corporate communications, always focusing on elevating the nonprofit’s presence rather than your own. For example, in your print ad with the wording "XYZ Corporation supports The Life Foundation," put the phrase XYZ Corporation in smaller print and make The Life Foundation logo bigger. 

Be an active and strong supporter of your nonprofit -- a partner -- seeking to increase its exposure where you can. Just remember: By honoring the nonprofit, others will honor you. 

Corporate investing in nonprofits can be a powerful and enriching experience. It fuels the nonprofit with the byproduct of the corporation: cash. It generates new business for both the corporation and the nonprofit. It builds trust quickly-- perhaps even quicker than by selling reliable products backed by quality and excellent service alone. And in making the decision to invest, your investment will serve you as a quiet reminder that serving others is the highest calling of mankind.

 

I hope you will consider investing in a nonprofit organization. Why not make it an agenda item for your next board of directors meeting? And if it does sound like a good idea for your organization, there is no time like the present. A present to give to the future. By starting the process today.