Reaping what we sow: How giving back can be good for business

by 05 Jan 2017

There is an old theory in economics that doesn't hold “corporate social responsibility” in very high esteem. According to this theory, companies give to society enough just by offering the products or services they offer. Any resources they give to charitable causes would be better spent reinvesting in the company. After all, the only people the company really serve are the investors or stockholders who have invested in it.

There's another theory, though, about giving back—and there has been quite a bit of research recently to back it up. According to this theory, giving back is not only good for society, but it's also good for business. People like to patron organizations that they believe are good for society. When organizations give back to the community in some way, it's they often get back more than they give in public relations. Whether it's intended to be or not, giving is an act of marketing. When you are a giving organization, you are sending the message to your customers that you care about the community as much as you do about the dollar.

But it isn't just your customers—giving can also drive productivity in your employees. On the December 26 episode of my Lykken on Lending podcast, I discussed giving with Kevin Stitt of Gateway Mortgage. The philanthropic work that is routinely done in his organization makes employees feel like they're part of something bigger—and they work all the harder to make the company successful.

An organization that gives is an organization that reaps what it sows. How have you given back to your community?

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