Here at DAFinitively Speaking we focus a lot on individual donors. However, many DAFs are used by corporations as well! Per Giving USA’s most recent report, corporate philanthropy grew by three percent in 2023 and more than 23 percent from 2018-2022! How is corporate philanthropy changing from employer matches and in-kind gifts? Let’s explore the now-wider world of corporate donations.
As Melissa Bank-Stepno noted earlier this year, corporate philanthropy has a movement similar to the Giving Pledge, called Pledge 1%. This movement, with dozens of contributing organizations, encourages corporations of all sizes to pledge, though it focuses on early-stage firms.
Those who pledge 1% can contribute via pledges of time, equity, products, profits or a combination thereof. In addition to the national campaign, there are also regional chapters of Pledge 1% that encourage organizations to partner with nonprofits in their communities to do good where they live and work.
Pledge 1%’s website also offers great resources to those in charge of making donations and those (like us) who want to learn more about them. One case study describes Twilio, a US-based cloud communications company. The profile not only described the company’s philanthropic strategy but noted that they have a DAF (funded by .01 percent of their social impact equity each year for a decade) as well as who sponsors it (Tides Foundation).
Other resources on the Pledge 1% website are specific to pledge members, but much of it is available to the public and includes guest posts by executives and other corporate leaders. The Learning Path section acts as a guide for companies who want to expand their philanthropic outreach and is organized by subject areas such as benchmarks, goals, and priorities.
Some of the more well-known DAF sponsors have programs specifically for their corporate clients, and just like individual donors, companies who set up DAFs can give through cash, stock or other assets. Fidelity Charitable offers a Corporate Giving Account, which specifically works with corporations to enable their giving. These funds have a minimum initial contribution of $100,000 and annual fees starting at $10,000. In their marketing materials, Fidelity suggests that clients could make their giving go further by combining existing employee matches with the Corporate Giving Account. Individual employees can open their own fund with no minimum initial contribution and a $50 minimum grant.
Similarly, Morgan Stanley also offers funds for corporate clients with a minimum $100,000 initial contribution. However, they also give employees the chance to establish their own funds with a $250 minimum initial contribution. The Morgan Stanley Global Impact Funding Trust, Inc. (MS GIFT) is the sponsor of these funds.
These sorts of programs make it possible for more employers and sponsors to make DAFs possible for a larger sector of the population.
As previously mentioned, the Tides Foundation works with corporations to help them with their philanthropic endeavors. While Tides has a similar $100,000 minimum initial contribution for US-based activity, funds who choose to support a single project or organization only need to contribute $50,000. Tides, which aims to fund projects based in equality and justice, also notes that donors should grant 20 to 30 percent of their funds each year towards social justice work. In addition to Twilio, some of Tides’ corporate DAF partners include Logitech, Sephora, Upwork, Kate Spade NY, and Ben & Jerry’s, amongst others.
Interestingly, Groundswell, a corporate social responsibility (CSR) fundraising platform (and a Pledge 1% partner), has a unique approach to corporate DAFs for the organizations that they provide services for: they help clients make it part of their employee benefit system. If an employer partners with Groundswell, the firm will create a DAF for each employee; that employer can contribute to their employees’ DAFs as part of their benefits, as well as allowing employees to contribute to their funds via a payroll deduction. The minimum contribution to open a fund with Groundswell is $1 with no grant minimum.
It has been interesting to see how corporate philanthropy has changed over many years in the prospect development industry. The DAF ecosystem has made historical levels of corporate giving easier and with greater options for employees as well. As you consider approaching companies for sponsorship and philanthropic donations, don’t forget to check and see if they have a company DAF as well!
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Image credit: Money gift – Pile US dollar banknotes wrapped with bright yellow ribbon by Marco Verch under Creative Commons 2.0
