The benefits of small business charitable giving

Charitable giving can give your business a sense of purpose, beyond just making profits. It can strengthen your connection to your community and build morale for both you and your employees.

by Jane Haskins, Esq.
updated May 11, 2023 ·  3min read


The end of the year is traditionally a time for contributing to food and toy drives, and writing checks to charities. Yet your small business can reap big benefits by participating in charitable efforts all year long.

Charitable giving can give your business a sense of purpose, beyond just making profits. It can strengthen your connection to your community and build morale for both you and your employees. And even a small contribution can make a big difference to a local organization.

Here are seven reasons to make charitable activities a part of your company's culture—no matter how big or small your business is.

1. Boosting morale

It feels good to help others. Both you and your employees stand to benefit psychologically when you know you have made a difference in someone else's life. Local contributions in particular can give you a chance to see firsthand the impact of your time or dollars. And employees tend to have greater respect for a boss who gives back.

2. Creating goodwill

When you sponsor a charitable event, donate supplies to disaster victims, volunteer at community clean-ups, or support other charitable activities in your community, people notice. Having your name attached to a cause or event builds name recognition. People like to support businesses that help others, and your community activities and donations can pay you back in increased business and customer loyalty.

3. Building camaraderie among employees

Writing checks is great, but when your whole team participates in working for a charitable cause, you help build camaraderie and give your employees a chance to get to know each other in a way they wouldn't otherwise.

4. Improving your community

Your support of community-based organizations, such as schools and local nonprofits, helps make your community a better place to live and work, which benefits you, your business, your employees, and your customers.

5. Networking

People who are leaders in the community also tend to be involved in its charitable institutions. Participation in charitable organizations gives you the opportunity to interact with local officials and community and business leaders whom you might not otherwise meet.

6. Attracting and retaining good employees

Millennials especially are known for being attracted to organizations that do good. Your charitable efforts can make your company more appealing to potential employees and help them feel more satisfaction at work. Making charitable activities a part of your business's mission, vision, and values says something about your organization.

7. Tax advantages

Depending on your business, there may be tax write-offs for charitable donations. Check with your accountant to find out what the benefits might be for your business.

Choosing a charitable cause or project

There's no one “right" way to give back. Huge corporations can fund massive initiatives, while a company with just a few employees may only have the resources to sponsor (or participate in) a neighborhood 5K run.

One approach is to choose a charitable organization that aligns with your business's brand and mission statement and support it regularly. Another is to ask your employees which causes are important to them.

Ways to help include:

  • Writing checks
  • Donating goods or services
  • Sponsoring events
  • Matching employee contributions

Or you can volunteer:

  • Organize a group volunteer activity and ask everyone to participate
  • Challenge employees to collectively contribute a certain number of volunteer hours
  • Give your employees a few days or hours off each year to use for volunteering

Consider your own business realities, and ask your employees what they'd like best.

Finally, make sure the organization you choose is a legitimate charity. Websites such as Charity Navigator can help you weed out the scams. Be especially careful about participating in religious or political causes that might alienate some employees or customers.

Giving back to the community means investing money or time, but you'll be rewarded with improved morale, a better community, and new opportunities for your business.

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Jane Haskins, Esq.

About the Author

Jane Haskins, Esq.

Jane Haskins is a freelance writer who practiced law for 20 years. Jane has litigated a wide variety of business dispute… Read more

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of the author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.