Charitable Donations Policy

Charitable Donations Policy

Are you looking for information about writing a charitable donations policy? Most large companies have written guidelines that include criteria and procedures for handling charitable giving. Find out what's usually included in this type of policy and see examples of existing documents of this type for review.

Purpose of Charitable Giving Policies

Companies that allocate a significant portion of resources to charitable donations can be well served by crafting a formal charitable donations policy that formalizes the manner in which its philanthropic efforts are handled. Having a policy serves the important purpose of clarifying the factors that impact the organization's donation decisions and how they are made.

Having a policy in place can help companies manage the many requests for donations that are made by charitable organizations throughout the year. For example, nonprofit organization development directors and volunteers who contact the organization to request financial support can be directed to review the policy before submitting a formal request to determine if what they are asking for are in compliance with the company's policy.

The policy can also be used as a tool to clarify reasons for donation request denial. For example, when donation requests are denied, the requesting organizations can be directed to the policy for information about why their request was not granted and to learn what might need to change in the future in order to be considered for a gift.

What to Include in a Charitable Donations Policy

While there is not a formula for exactly what must be included in a policy outlining how a company approaches charitable contributions, there tend to be similarities among these types of documents. Elements often included in policies for handling charitable giving include:

  • Overview: Policies regarding charitable donations generally start with an overview of the company's approach to charitable giving.
  • Oversight Responsibility: The policy should include a description of who is responsible for overseeing the company's charitable giving efforts and how the oversight process works within the organization.
  • Criteria for Eligibility: If the business uses specific criteria in determining what types of organizations and causes it will choose to support, that information should be included in its donation policy. For example, if giving is limited to 501(c)(3) or 501(c)(6) entities and/or if requests from individuals are not considered, you may want to include that in your policy.
  • Exclusions: If there are certain types of causes or requests that the company will not consider, these exclusions can be described in the policy. For example if the company does not entertain requests to support religious causes or political events and programs, it's a good idea to list such exclusions in the formal policy.
  • Grant Programs: If the business offers grant programs, information about options and links to grant application forms can be provided in the published policy.
  • Focus Area: If the company has one or more particular focus areas that it targets for donations, that information should be provided in the policy. For example, if a company targets its philanthropic efforts on educational programs, that information should be specified in the formal policy.
  • Request Procedure: The policy should provide instructions regarding how eligible nonprofit organizations should approach requesting financial support from the company.
  • Matching Policy: If the company offers a program whereby employee gifts to certain types of nonprofit organizations are matched by the business, details are typically specified in the policy.

Examples of Charitable Donations Policies

Many companies post their charitable donations policies online. Here are a few examples of published documents that you may want to review when looking for ideas and inspiration when preparing to write a policy of your own:

  • Blue Cross Blue Shield of Rhode Island - BCBS has a clear policy that can be a good example for drafting your own. It covers incoming and outgoing donations and the mission and general focus the company supports.
  • Colgate Palmolive - Focusing more on the request procedure and general mission of the company's charitable donation policy, this is a good example of a short, focused document.
  • Rocky Mountain Credit Union - This credit union has a clear, detailed example of a charitable donations policy available to inspire you in writing your own. It covers the type of charitable organizations they support and the procedure for requesting a donation.
  • University of Cincinnati - This is a good example of a policy for an educational institution, covering different types of donations and organizations who may request them.

Verify Policy Legal Compliance

As should be the case with any formal company policy, be sure to verify that the charitable donations policy document you create is in compliance with all local, state and federal laws before it is finalized and published. Take the time to verify that the document is fully compliant by having it reviewed by your legal counsel as part of your policy development process and make any recommended changes before final adoption and publication.

Charitable Donations Policy