Giving in the Wake of Disaster

In the wake of the tsunami, Hurricane Katrina, the Pakistan earthquake and Guatemalan mudslides, to name a few disasters, the question for many this holiday season, is how much to give, not whether to give. At least, that's the stance of many American companies and employees that are opening their coffers with almost unprecedented generosity.

One biotech company, for example, has donated $2.5 million to the Hurricane Katrina relief efforts, focusing on dialysis and cancer patients, according to the New York Times. Another has donated millions in cash and equipment as well as a mobile power plant. And the list of contributors goes on to the tune of more than $312 million and counting, according to the Chronicle of Philanthropy. In fact, a corporate donation that's less than $1 million is considered tight-fisted by many dealing with the magnitude of these disasters.

Not to be outdone, American employees are collectively matching, even surpassing, direct corporate contributions. Last year, for example, individual Americans gave an estimated $187.9 billion — up 1.4% from the previous year. Workplace giving campaigns raised about $4.8 billion, according to Charity Navigator's Workplace Giving Guide. This year, Americans are likely to pass those marks.

At Westaff, which has several branches in areas affected by Katrina, employees from around the country sent checks and donated boxes of food, clothes, blankets, toiletries, bedding and baby items. Westaff mailrooms packed up the goods and sent them to local offices where branch managers distributed them to regular and temporary employees who were suffering in the aftermath of the storm as well as local charities and churches.

"Like a lot of people, our employees were wondering what they could do to help," said Gail Jern, Westaff's Human Resources Manager. "This was a specific, immediate way in which people could contribute. For us, it was like taking care of family."

Given the outpouring, some companies are looking anew at their long term giving programs to see if they fit employees' goals and preferences. But it's not just for altruistic reasons, experts say. It's also the smart thing to do. Studies show that offering employees an easy-access, low-pressure and meaningful giving program can play a significant role in boosting employee loyalty and morale.

Walker Information, for example, has developed a Corporate Philanthropy Index (CPI) which measures employees' and employers' levels of involvement in volunteerism and corporate philanthropy. According to their 2003 study of workers in the lower 48 states, seven in ten employees who have a high CPI recommend their organization as a good place to work. In contrast, less than four in ten employees with a low CPI would recommend their organization.

"Employees want to be proud of the company they work for," Jern said. "They want to feel that their company has an interest in more than just current revenues — that their companies also care about their communities and the welfare of their employees. They want to be associated with a caring company."

Among current corporate trends, some companies have started offering grants to nonprofit groups at which their employees volunteer. Others have broadened the types of charities they'll match gifts to. Still others have moved charitable giving in their workplaces totally online. Online access has provided employees with the ability to choose among hundreds of thousands of charitable organizations and to donate with lower overhead charges.

Matching gifts or making grants to groups where employees volunteer are particularly positive statements to make to employees, Jern said: "It shows an appreciation for your employees getting involved in charitable groups. It basically says, 'Good for you! And we support you doing that.'"