What Is Corporate Social Investment?
Corporate social investment is how companies help their communities. They set aside money, time or expertise for local nonprofit organizations to use to provide solutions for significant social problems. Usually corporations match their social investment with their mission so that the benefits that their contributions generate reflect back to help their reputation and their brand.
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Corporations who set aside money to invest in solutions to social problems often establish a 501(c)3 foundation. This is a designation from the IRS that provides certain tax benefits in exchange for a pledge to give away 5 percent of its assets every year to nonprofit charitable organizations. In 2005, four of the five American foundations that gave the most money away were corporate foundations: Bristol Meyers Squibb Patient Assistance Foundation, Merck Patient Assistance Program, Ford Foundation and the GlaxoSmithKline Patient Access Programs Foundation.
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Another approach that many corporations take to invest in serious social problems is cause marketing. Whenever a product includes the pink breast cancer ribbon, for instance, you know that the company invests a small percentage of the price paid by the customer to breast cancer research.
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Corporate sponsorships are a third way that companies express social investment back into their communities. They may sponsor an event to benefit a nonprofit cause as the sole sponsor. This means that they contribute funding to the organization to facilitate the run, gala or carnival. Other sponsorships involve paying to have their logo appear on a nonprofit website, in a program, or as a poster to benefit an important cause.
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Other corporations like MasterCard encourage its employees to become involved in community service. Corporate social investment includes hiring full-time staff to interface with nonprofit organizations like schools and then to match individual employees whose skills can help the nonprofit with a program or goal. Enterprise is an example of a corporation whose set aside foundation assets are awarded to nonprofits with whom their employees are concerned and involved.
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To learn about how a corporation expresses social investment, visit the company website. Then look for links to "Community Involvement," "About Us," "Corporate Social Investment," "Company Sponsorship Information" or "Foundation." While most companies engage in some form of social investment, each one sets its own priorities and protocols. So, if you are a nonprofit organization who hopes to become funded, you must follow the particular directions for each corporation.
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