5.3 Developing Giving Guidelines and Criteria

Developing giving guidelines and criteria is crucial for effective corporate philanthropy. Companies must define focus areas, set eligibility criteria, and establish application processes that align with their values and goals. This ensures resources are allocated strategically and impactfully.

Accountability and ethics are equally important in corporate giving. Companies should implement reporting requirements, practice good stewardship, and enforce conflict of interest policies. This maintains transparency and builds trust with stakeholders while maximizing the positive impact of philanthropic efforts.

Giving Priorities

Focus Areas and Geographic Scope

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• Determine the specific issues or causes the company will prioritize in its giving program (education, healthcare, environmental conservation)
• Align focus areas with the company's mission, values, and expertise to maximize impact and authenticity
• Consider the geographic scope of giving, whether it will be local, regional, national, or international
• Base geographic scope on factors such as the company's locations, stakeholder interests, and areas of greatest need

Eligibility Criteria and Exclusions

• Establish clear eligibility criteria for potential grantees or partners, including their legal status (501(c)(3) for U.S. nonprofits), mission alignment, and track record
• Determine any specific types of organizations or activities that will be excluded from funding (political campaigns, religious proselytizing)
• Set guidelines for the size and types of grants or donations that will be considered (multi-year grants, in-kind contributions, employee matching programs)
• Communicate eligibility criteria and exclusions clearly to manage expectations and ensure a fair and transparent process

Application and Review

Application Process and Due Diligence

• Design an application process that is clear, accessible, and proportionate to the level of funding being requested
• Require applicants to provide relevant information such as their mission, programs, leadership, and financial statements
• Conduct due diligence on potential grantees or partners to assess their credibility, capacity, and alignment with the company's priorities
• Verify the legal and tax status of applicants and check for any reputational risks or conflicts of interest

Evaluation Metrics and Decision-Making

• Develop evaluation criteria and metrics to assess the potential impact and feasibility of proposed projects or partnerships
• Consider factors such as the scale and sustainability of the proposed work, the strength of the organization's leadership and track record, and the level of community engagement and support
• Involve a diverse group of stakeholders, including employees, community members, and subject matter experts, in the review and decision-making process
• Communicate funding decisions in a timely and transparent manner, providing feedback to applicants as appropriate

Accountability and Ethics

Reporting Requirements and Stewardship

• Establish reporting requirements for grantees or partners to ensure accountability and track progress toward intended outcomes
• Request regular updates on project activities, challenges, and accomplishments, as well as financial reports detailing the use of funds
• Provide support and guidance to help grantees or partners succeed, such as capacity-building resources or opportunities for collaboration and learning
• Practice good stewardship of company resources by monitoring grants and partnerships closely and taking corrective action if needed

Conflict of Interest Policies and Ethical Considerations

• Develop and enforce conflict of interest policies to prevent any real or perceived impropriety in the company's giving decisions
• Require employees and board members to disclose any personal or professional connections to potential grantees or partners
• Ensure that giving decisions are based on objective criteria and not influenced by personal interests or political considerations
• Adhere to all relevant laws and regulations governing corporate philanthropy, such as restrictions on self-dealing or lobbying activities
• Maintain transparency and communicate openly about the company's giving priorities, processes, and decisions to build trust with stakeholders