Pros and Cons Of Having Donation And Gift Matching Program Programs For Your Business

Companies are increasingly willing to engage themselves in honorable and kind causes as time passes.

Showing the world that a company cares and is willing to help certain causes will contribute to enhancing its overall public image and reputation.

It is possible to achieve these goals by implementing donation and gift matching programs.

Over the years, these programs have gained popularity due to their effectiveness and engagement.

There are both pros and cons to having donation and gift programs for your business, which you should be aware of.

Continue reading if you’re curious. We’ll cover the most important ones in this post.

What is a donation matching program?

Donation matching is a corporate initiative in which an employer matches an employee’s gift to a specific cause, thereby increasing the overall amount donated. 

For instance, if an employee donates $100 to a non-profit organization, the employer will match that donation with $100. As a result, the organization would receive $200 instead of $100. Matching donations are usually financial donations.

With this donation matching program guide, you’ll have a better understanding of it.

What is a gift matching program?

Matching gifts refer to initiatives in which the employer matches the gift donations made by employees.

In most cases, this involves a physical donation, for instance, an employee may donate a certain number of meals and the employer may match them.

Examples of non-profits eligible for donation and gift matching  programs

Here are a few examples of non-profit organizations eligible for donation and gift matching programs:

• Educational entities–universities, colleges, academies, etc.
• Cultural institutions–museums, zoos, aquariums, theaters, operas, etc.
• Community associations–homeless shelters, low-income assistance, child welfare, etc.
• Environmental organizations–conservation efforts, wildlife preservation programs, etc.
• Health services–hospitals, community health centers, substance abuse programs, etc.

Pros and cons of having donation and gift matching programs

There are many advantages to having donation and gift matching programs for your business. On the other hand, there are some disadvantages that need to be considered as well. 

We’ll list a few of the most important ones in this section. 

Pros of having donation and gift matching programs

Improve the reputation of your company

One of the primary advantages of implementing donation and gift matching programs is the improvement of your company’s reputation. When it comes to corporate gifts, customers prefer businesses that show compassion and social responsibility. Seeing that you care about others and are involved in charitable and beneficial causes will help your audience, stakeholders, and other companies view your company in a more favorable light, increasing the likelihood that they will want to do business with you.

Attract investors and business partnerships

According to the point made above, if your audience starts noticing your company, investors and other businesses will also be appreciative of your donations and charitable actions. By doing this you will encourage them to invest in your business or do partnerships with you, increasing your authority and capital.

Improve employee engagement and overall company culture

The more you show kindness to your employees, the more they’ll appreciate your company and its culture. Besides boosting employee engagement in donation and gift programs, it may also convince them to stay at your company longer. 

Reduce turnover and attract top talents

The more employees enjoy working at and staying at your company, the less likely they will be to leave. Consequently, your employee retention rate will increase drastically.

Employee retention rates are a good indicator of a company’s culture and work environment. As you might imagine, this will attract top talents, which in turn will increase productivity and innovation at your company.

Take advantage of tax benefits

Individuals and corporations alike are encouraged to give to charitable organizations because of tax benefits.

Specifically, corporations can take up to 10 percent of their annual income in tax deductions from charitable giving. 

Cons of having donation and gift matching programs

Donations and gifts can hamper the goals of a company

While supporting and donating to important causes is a great thing, the cash cost that organizations face with these outreach efforts can leave them with limited funding for other priorities.

The fact that small businesses often have limited budgets makes it difficult to handle a matching gift program and meet other business needs at the same time.

Donation and gift matching programs require time to create a payoff

Businesses often get involved in donation and gift matching programs because they expect to gain a direct benefit from their participation in the community. However, it may take time to reach a level of community awareness that will result in tangible results.

Creating the necessary relationships for growth can often take months or even years before producing any results.

Donating and gifting is not something that all employees want to do

However, not all employers might be willing to participate in such programs, even if you as the employer are willing to match your employer’s contributions. 

Several of them may be involved in charity initiatives in their private lives or have an interest in donating on their own. 

Similarly, not all employees may have the financial ability to donate. Feeling obligated to send money to a charity in that situation might cause them to feel uncomfortable.

How to start a donation and gift matching program in your business in 6 steps

In order to start your own donation program or gift matching program, here are six steps you need to follow.

1. Define clear objectives and set measurable goals

Generally, companies start donation or gift matching programs for one or more specific reasons. The company’s objectives should come to light during the development of the program.

By identifying and setting clear corporate goals, you will be able to monitor later on the results your firm is getting and whether the program contributed to the achievement of your company’s original goal.

2. Set your donation and gift matching program guidelines

Almost every employer has its own definition of a ‘match’ for its employees. Before you begin the program, you should determine yours.

Here are some factors to keep into consideration:

• Matching donation ratio. Most companies have a 1:1 match rate, but others set drastically different standards. Many companies will donate $.50 for every dollar an employee donates, but others will donate up to $5 for every $1 that an employee donates. In this case, you should also define your matching ratio and stick to it.

• Define maximum and minimum amounts.  Many corporations have minimums and maximums they apply to their corporate donation and gift matching programs. Minimums vary from $1 to $100, although it is most common to have a $25 minimum. Usually, the maximum is $1,000, but it can go as high as $15,000, or even further. You should therefore know your company’s maximum and minimum limits.

• Submission deadlines. Each company also sets its own deadlines, such as the end of the month or the end of the year. Hence, make sure you establish the deadlines as well.

3. Align incentives with your donation program goals

No matter what your goals are, aligning the incentives of your program is critical to driving sustained and increased engagement from your employees.

Perhaps your organization strongly supports education initiatives that will empower future generations. Donating to educational institutions and nonprofit organizations that focus on educational initiatives will encourage your employees to join you in your mission.

In the same way, you can reward employees who donate with periodic rewards, which may be financial or otherwise.

4. Find a nonprofit or create a fundraiser

As part of starting a donation or gift matching program, you should also decide which non-profits to support. You can support one or more.

Consider non-profits whose missions align with those of your company.

It would be helpful and good practice to involve your employees in this step by asking them what they’re passionate about or what causes they’d like to support.

You may also want to organize a fundraiser to assist you with your main goal of raising money for a charitable cause.

5. Inform employees without restricting them

You’ve set goals and decided which organization and cause you will support. The next step is to share all of this information with your employees and encourage them to participate.

However, no matter what objectives or organizations you establish at the beginning, you should not limit your employees’ choices. You may find that most of them support a cause or organization other than the one you chose. As a result, it would be wise for you to consider your employees’ needs and preferences and ensure they are met accordingly.

6. Evolve your program to keep up with your company values

Throughout their existence, companies undergo changes in vision, mission, and values. Consequently, the goals you set for your donation program at the beginning might no longer reflect your company’s values over time.

It is necessary to be ready and flexible in case such an event occurs so that your company can change its direction towards more relevant causes.

Today, for example, there are more urgent needs for sustaining causes pertaining to the environment, climate change, than ever before.

Conclusions

This concludes this blog post about donation and gift matching programs. 

The benefits and disadvantages of donations and matching programs reveal that companies help others due to the kindness of the act and also to improve their reputation.

If you understand all the positives and negatives of such programs, you will be able to determine whether they might be suitable for your company based on its availability, dimensions, and employee participation.

Thank you for taking the time to read this blog post. Hopefully, it was informative and helpful.

If you want to read more, check out this article on how to properly ask supporters for their donations on your website.

About the author:

Flavia Silipo is a skilled SEO copywriter and digital marketing specialist with over two years of experience. You can find her on LinkedIn.

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