29 Jan. 2014 | Comments (0)
The Conference Board CEO Challenge 2014 recently identified human capital as corporate leaders’ most pressing challenge. The report found that CEOs recognize the importance of developing an engaged workforce to accomplish success. So, it’s little wonder that most companies are using their corporate philanthropy programs as a tool in that engagement process. In this two-part series, I look at the findings of our recent survey about employee grant-making committees.
In December last year, we surveyed 53 U.S. companies to understand whether employee grant-making committees are a common vehicle for engaging employees in the grant-making process, and how those committees are typically structured where they do exist. To ensure anonymity, we will not reveal the names of participating companies. The results showed that although such committees are not necessarily pervasive throughout the corporate philanthropy field, around one-third of companies do use them as way of involving employees in the grant-making process. This does not mean, however, that the majority of companies do not seek employee input into grant making in other ways. Of course, matching gift programs are popular (see Giving in Numbers: 2013 Edition), but we wanted to see whether structured engagement occurred for more significant grants. Of those companies that reported not having an official employee grant-making committee, 55 percent said that they still turn to employees in some way for insight regarding grant recipients.
Respondents reported a fairly expansive list of examples of this engagement, including:
- Advisory committees Groups that provide feedback, but rarely have any decision-making authority. Companies often engage senior leaders in advisory committees.
- Crowd sourcing Voting and focus groups among employees help to direct funds.
- Employee networks Cross-functional committees and networks that address a variety of issues. These often include input into grant making and volunteerism as part of their charter.
- Grant series Campaigns that involve employees in site visits and evaluation of prospective grantees.
- Local involvement Employee committees and other groups outside the headquarter country nominate local organizations for funding.
Grant-making requires specialized knowledge
The most common response for why companies choose not to involve employees in grant-making decisions is that a lack of expertise on the part of employees could result in grants failing to adhere to the company’s broader corporate responsibility strategy. Without the right knowledge of the field, respondents said, the philanthropic return on investment for grants might not be maximized. Respondents also cited the need to abide by specific laws for grant-making and bad past experiences with advisory or grant-making committees as key reasons to not involve employees in significant grant decisions. The Conference Board CEO Challenge 2014 suggests that employee engagement will be top of mind for company leaders, but our survey found that it’s unlikely to be in the form of official employee grant-making committees. Ninety percent of respondents said that they will not be forming a committee in the next five years. In part two, I will be looking more closely at the structure of the employee grant-making committees that do exist. Stay tuned.