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Way to give back for firm's maximum benefit – Business Daily

Way to give back for firm’s maximum benefit. PHOTO | POOL
The Christmas season is back! The season means many things to many people.
For many, this is the season they take their annual breaks and vacations while for others it is a season of giving back.
Many businesses do charitable activities across the season.
There are many ways a startup can give back without breaking the bank.
One of the ways is by simply visiting the less fortunate and spending time with them. This is almost free and will not cost much.
Businesses can also volunteer in charitable organizations across the season. This depends on the need of the charity organization.
One can volunteer through cooking, cleaning or caregiving as examples of voluntary work.
As a way of giving back, businesses could choose to offer their products or services for free or at a discounted rate.
An example is the Miss Lang’ata pageant organized by a business in the beauty services industry.
READ: Evolution of philanthropy and CSR
The business offered free beauty services to the female prisoners and also organized the pageant.
One of the goals was probably boosting the self-esteem of female prisoners.
Businesses can also give back through monetary and gift donations.
They could do this on their own initiative or partner with others to be able to make donations and gifts. A lot of larger businesses engage in this form of giving back.
It is important for a business to have a structured manner of giving back to society so that the business is able to reap maximum benefit from its giving.
The first thing to consider having in place is a corporate social responsibility (CSR) policy.
A CSR policy would be able to guide the business on the principles and objectives of giving.
There are many objectives and this really depends on the vision of the business.
Some CSR objectives include upholding human rights preservation of the environment, support for minority groups or faith-driven objectives.
A faith-driven CSR derives its ethical values and principle from religious faiths or denominations.
It is also important to nominate a team to run the business CSR activities or giving back to enhance accountability, transparency and other principles of good governance.
Smaller businesses can form a team or a committee to lead the initiatives.
In larger businesses, there is a whole CSR department that handles the business’ CSR activities.
For larger initiatives, I would recommend the registration of a foundation to run with the CSR activities.
A foundation would give the CSR activities a unique identity and a legal vehicle with which to carry on the activities.
ALSO READ: CSR: Do good in a sustainable way
Some attractive legal vehicles to use include trusts, NGOs or companies limited by guarantee.
Some forms of giving back may require the involvement of a lawyer to help draft the documentation.
For example, if the business shall receive donations from partners then it may be apt to draft suitable agreements as a way of maintaining accountability and being transparent to donors.
In very large donations, certain laws such as money laundering laws may call for compliance.
If a business incorporates a foundation to run with CSR, then that foundation ought to pursue tax exemption status from the government.
This means that it would not pay any taxes for donations and other income that is for charitable purposes.
Giving back and CSR has several hidden benefits. Firstly, it improves the image and public reputation of the company.
It also fosters teamwork and in some cases motivates staff. It may also attract ethical investors to your business.
Tis the season to give indeed!
Ms Mputhia is the founder of C Mputhia Advocates.

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Author

Joseph Muongi

Financial.co.ke was founded by Mr. Joseph Muongi Kamau. He holds a Master of Science in Finance, Bachelors of Science in Actuarial Science and a Certificate of proficiencty in insurance. He's also the lead financial consultant.