1. Corporate & Community Impact Resources for Business Owners
Rob MacPherson, CAP, VP of Development & Strategy
Sarah Weaver, JD, Senior Gift Planning Advisor
March 1, 2019

2. Overview Trends and Benefits CSR Strategies Charitable Tools
Succession Planning
WHY Is This Topic Important? Trends and Business Benefits of Community Engagement & Corporate Social Responsibility
WHAT Is My CSR Platform? CSR Strategies, Including Brand, Image & Values
HOW Do I Utilize CSR? Charitable Tools for the Business Owner
What Happens WHEN I Am Ready to Exit My Business? Succession Planning for Business, Family & Community

3. Corporate Social Responsibility (CSR)
“Movement aimed at encouraging companies to be aware of the impact of their business on the rest of society – including their own stakeholders and the environment.”
“A business approach that contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders.”

4. CSR Approaches Differ Widely by Company
Human rights
Corporate governance
Environmental impact
Employee culture & working conditions
Health & safety
Charitable engagement
Community outreach
Economic return & profit sharing
Others

5. Extremes & Everything In Between – It’s All Good!

6. TRENDS & BENEFITS OF CSR

7. Great Expectations A 2017 Cone Communications Study on CSR found:
70% of Americans believe companies have an obligation to take actions to improve issues that may not be relevant to their everyday business
87% of Americans would purchase a product because that company stood up for or advocated for an issue that they care about
76% of Americans would refuse to purchase a company’s product or services upon learning that it supported an issue contrary to their beliefs

8. Great Expectations

9. Talent Attraction & Retention
Millennials now make up the largest segment of the workforce
Predicted to be 50% within the next 2 years and 75% by 2030 – US Bureau of Labor Statistics
The “Purpose Over Paycheck” Generation
According to PwC’s recent Workforce of the Future survey, 88% of Millennials want to work for a company whose values reflect their own
Research from Deloitte indicates that 73% of Millennials who work at a “purpose-driven” company are engaged, compared with just 23% who don’t

10. Business Benefits Improved Public Image Increased Media Coverage
Boosted Employee Engagement
Satisfied & Engaged Customers
Increased Innovation & Creativity
Cost Savings
Brand Differentiation & Competitive Advantage
Long-Term Thinking
Attraction & Retention of Investors

11. Impact Investing
Impact investing combines financial returns with social returns
According to a recent survey from the Global Impact Investing Network, the estimated value of the impact investing sector doubled from $114 billion in assets under management in 2017 to $228 billion in 2018

12. CSR STRATEGIES

13. CSR Strategies Values, Interests, Purpose, Mission, Promise
Stakeholders
Employee Engagement
Customer & Client Engagement and Awareness
Industry & Competitor Awareness
Pledge 1%

14. CHARITABLE TOOLS FOR BUSINESS OWNERS

15. Corporate Foundations
These are a few of the country’s largest corporate foundations

16. Donor-Advised Funds for Business Entities
Corporate Advised Funds
Donor-Advised Funds for Business Entities
Company as Donor (but anyone can contribute – and get a tax deduction!)
Advisory Committee makes grant recommendations
Same customized philanthropic services as individual and family donor-advised funds
CICF can assist in engaging employees, promoting the fund internally and externally, identifying charitable purpose or themes, and much more
Some regulations around fundraising for donor-advised funds, but we can help navigate
CICF Employee Fund
Helmer Scientific – Chili Cookoff

17. Employee Matching Funds
Doubles the incentive for employees to give!
CICF can administer matching funds
Examples

18. Must Not Look Like an Employee Benefit!
Employee Scholarship Funds
Must Not Look Like an Employee Benefit!
Can be tricky, but if done correctly, can be an excellent CSR tool.
Conditions that must be met:
Inducement
Selection Committee
Eligibility Requirements
Objective Basis of Selection
Employment
Course of Study
Other Objectives
Percentage test:
No more than 25% of eligible applicants considered are chosen, or
No more than 10% of all eligible individuals (regardless of whether they apply) are awarded scholarships

19. Social Impact Investment Opportunities

20. BUSINESS SUCCESSION PLANNING

21. Gifts of Closely-Held Business Interests
JP Morgan Chase surveyed 817 small- and middle-market businesses:
One quarter said they are either planning or considering a full or partial ownership transfer within two years
Your clients want you to ask! This is a huge value-add opportunity!
At CICF, we can help your philanthropically-inclined business owner clients. Donating closely-held business interests is a tax-smart charitable giving strategy, and with some basic due diligence, we can accept closely-held business assets into a personal or corporate donor-advised fund.

22. Timing & Process PRE-AGREEMENT & PRE-SALE The process: Donate
Liquidate
Grant
Timing & Structure
MUST BE PRE-AGREEMENT & PRE-SALE to maximize tax benefits, i.e., must not be bound to particular seller in writing
The process:
Shares of closely-held business interests are donated to donor-advised fund
Donor-advised fund entity liquidates those shares
Proceeds are available for the donor to make charitable grants

23. Tax Savings & Avoidance
Charitable Income Tax Deduction
AND
Capital Gains Avoidance
Tax Savings & Avoidance
Receive tax deduction for the full fair market value of the donated shares – requires a qualified appraisal
Avoid capital gains tax on appreciation of the donated shares – crucial for many business owners in which their basis is zero
Compare with selling first and donating proceeds: income tax deduction but still subject to capital gains tax

24. QUESTIONS?

25. Thank You! Rob MacPherson, CAP
Vice President of Development & Strategy
Sarah Weaver, JD
Senior Gift Planning Advisor