Community Investment Gives Corporations a Decisive Edge in the Talent War
Eighty-six per cent of employees who are convinced their company is highly committed to community say they are ‘extremely or very likely’ to stay in their job for the next two years, according to a new study from Imagine Canada.
The 2019 Corporate Community Investment Report entitled Profit, Purpose and Talent: Trends and Motivations in Corporate Giving and Volunteering, shows conclusively that high levels of community engagement lead to long-term business advantages.
The research underpinning the report included the opinions of 1,506 private sector employees and a survey of 65 leading Canadian corporations in community investment. Collectively, these corporations invested $592 million in communities over the past year.
“This report sends a nuanced message,” says Bruce MacDonald, Imagine Canada’s president and CEO. “Employees who believe their company is genuinely committed to community are more likely to stay; more likely to be loyal; more likely to share common purpose and more likely to recommend their company to others. But the research also shows businesses don’t get these benefits unless community investment is done well. The commitment to creating social value must be authentic and deeply embedded in a corporation’s DNA. Dabbling in donations won’t influence employees.”
• 50% of employees surveyed say they considered their employer’s reputation for charitable and community work before accepting their position
• 28% say they would be willing to take a pay decrease to work for a company more strongly committed to community service
Among employees who believe their company is highly committed to community:
• 84% are extremely or very satisfied with their job compared to 46% among others
• 59% say they are very likely to recommend their company versus 23% among others
• 47% strongly agree they share a common social purpose with their company compared to 16% among others
“Talent, which is key to the success of any business in any sector, has never been more mobile than it is today,” says Susan Scotti, Executive Vice- President, Business Council of Canada. “That’s why Canadian companies are doing more to invest in their communities and the organizations that make them flourish.”
Workplace donation programs inspire generosity. The study also reveals high potential for growing employee giving. Among those working for companies with payroll deduction programs, employee donation matching and giving campaigns, 79% reported they donated to charity versus 47% among those with no workplace donation programs. As well, 76% of those surveyed say they now regularly support a charity they learned about at work.
Mobilizing highly motivated employee groups to create social value has significant implications for Canada’s social fabric.
Demand for the essential services provided by the charitable sector is expected to spike over the next decade, creating a “social deficit”. This means in a few years charities and non-profits will need $25 billion more than they have today to meet spiraling demand. This forecast is based on current demographic trends and average GDP growth of 1.8% (source: Parliamentary budget office and Conference Board estimates).
This sharp rise in demand is taking place amid steadily declining donations from individual Canadians. Between 1997 and 2017, tax-filers claiming a charitable donation dropped from 26% to 20% (source: Statistics Canada).
In contrast, corporate donations have risen steadily in recent years as leading companies have recognized the business benefits of creating social value.
“Socially committed corporations and their employees are a bulwark against the social deficit,” says MacDonald. “Visionary corporate leaders are recognizing community investment as the means to attracting the workforce of tomorrow.”
Corporate Community investment trends: The 65 leading corporations examined in the report were selected for their community expertise. Five over-arching best practices were identified that define leadership in creating social value:
• integration of community investment into the corporation’s overall business strategy
• embedding community commitment into the company’s mission and purpose
• setting clear community investment objectives and measuring impact
• investment in underlying infrastructure, systems and processes including technology and innovation
• much higher employee participation rates than other companies
Many of the 65 leading Canadian corporations surveyed are members of Imagine Canada’s Caring Company Program Caring Companies. These corporations have agreed to invest 1% of pre-tax profit in building stronger communities.
Imagine Canada is a national charitable organization whose cause is Canada’s charities. Corporate community investments are an integral part of Imagine Canada’s vision for a vibrant and strong charitable sector. Imagine Canada’s Caring Company designation encourages companies to adopt a leadership role as investors of 1% of pre-tax profit into stronger communities.