STEP 1: Design and Structure
The first step to building an effective corporate philanthropic program is to determine the design and structure. Companies can build this on their own, or work with an external team, which does this work for a fee.
If you want to set up your own foundation we recommend that you speak with the company's legal counsel to get recommendations on attorneys who specialize doing this in your area. We found the up front cost of setting up your own Foundation is about $15,000 in legal fees and about 100 man hours to get the original documentation filed through the IRS.
The Entrepreneur's Foundation-a national group of non-profit organizations dedicated to strengthening the ties between entrepreneurial companies and the communities in which they operate.
- Cost benefits a document which outlines the cost and benefits of different structural models
If you decide to outsource. There are many good organizations to consider partnering with or to contact for further information to help you get started. For example, the Entrepreneur's Foundation-is a national group of nonprofit organizations dedicated to strengthening the ties between entrepreneurial companies and the communities in which they operate. Some links to local entrepreneur foundations can be found here:
- EF Bay Area http://www.efbayarea.org
- EF Boulder http://www.efcolorado.org
- Foundation Source http://www.foundationsource.com
- Silicon Valley Community Foundation http://www.siliconvalleycf.org
A key next step will be to develop your initial programs (regardless of whether or not you outsource). Some examples of what needs to be created after you have aligned on a structure are below:
- Development of corporate infrastructure and guidelines to support the program
- Creation of corporate giving programs
- Development of employee giving and employee volunteer programs
- Incorporation of good corporate citizenship into business practices including operations, marketing and manufacturing
Salesforce.com Example:
Salesforce.com made a commitment to launch a foundation at a very early stage. Pre-IPO and with about 50 employees, the company invested $250,000 to hire initial staff, set the organization up and provide some funding available to support grants and a volunteer program.
Creating a Board
If you choose to run your own separate structure you will need to develop a Board of Directors. If you outsource your programs you should still have a ‘governing body' tasked with overseeing the start up efforts. The role of the board includes:
- Setting policy for funding and administration
- Ensuring adherence to federal and state requirements
- Upholding the bylaws and policies of the foundation itself
- Overseeing grant approvals beyond staff discretionary level
- Supervising staff in executing the foundation's work
- Board Member Agreement
Look for a board that makes sense for your foundation's mission. For example, salesforce.com is a technology company with a foundation committed to providing young people access to technology solutions. Our board is comprised of leaders in technology and business as well as leaders in the non-profit and foundation arena. It is necessary to include people who understand the needs of the foundation's beneficiaries. If your nonprofit arm focused on health care, for example, have a doctor on the board. If it aims to improve education, enlist the aid of a teacher.
