Give and take

I have an issue that I wish to share with you all that has been concerning me for some time; I do not contribute enough to charity. That is not just in terms of giving money but also in terms of giving time.

It is very easy to find reasons not
to contribute, especially when high profile cases such a Kid's Company
or the harassment of Olive Cooke, the
92 year old poppy seller who recently died and had received 276 begging letters from charities in one month, create bad publicity.

This has the effect of making you feel like you don't want to be involved with such organisations. However we all have a moral and ethical responsibility to support and help those less fortunate than ourselves.

In 2012 CNN ran an item suggesting that if you netted more than $34,000 after tax, you were among the richest 1 per cent of the world. The global median annual salary was reported as $1,225. While it is very easy to pick holes in statistics such as these, they do convey a general truth - we are all very lucky to be living in a westernised democracy and we should not forget it.

So isn't it about time that we started giving something back? I have therefore decided that after a little appropriate research, I will make regular donations to some carefully chosen charities.

Corporate duty

However the moral obligation to give does not end with individuals. Corporates also have an obligation towards corporate social responsibility, and arguably, it is bigger. They cannot exist in a silo, distinct from the environment in which they operate.

Is it acceptable that the richest part of the country, i.e. the city, lies next door to one of the poorest, and the two rarely meet and certainly don't understand each other?

Just think about the good that could result from firms in and around the main cities and towns within the UK, all adopting local causes and charities.

Corporates can add a huge amount of value to the environment in which they operate, not just by gifting money, but by the provision of opportunity.

This might be by way of internships or training, or even partnering. There is a world of opportunity out there for people and they are unaware of it.

Honest endeavours

Projects do need to be carefully chosen. They should not just reflect the personal pet projects of senior management, or be so blatantly a business promotion exercise that they border on advertising or even propaganda. This will do more harm than good.

Corporate support should be a partnership and should ensure that good does come out of it. It also needs to be structured to ensure that there is no gap between the firm's words and actions.

McKinseys have talked about mutual value creation. By this they mean partnering with an organisation that can benefit from your core expertise, and you can benefit from theirs. This allows both organisations to grow together. Objectives, measurement criteria and time frames obviously have to be put in place. However time and resources will always be limited and careful planning will be crucial.

Mutually assured

If a business is not convinced by the benefits that can arise as a result of partnering, then what about the purely business benefits?

For a start it leads to a much better public image. Many of us are operating in a highly competitive market place where most firms are offering a very similar suite of services. What would distinguish your firm from the others?

It might be that the charitable and social responsibility commitments of
the firm may help to separate it from the herd.

We would all prefer to be part of a giving society and a firm that recognises this will also benefit from a more positive environment within the firm. People will feel happier about themselves and where they work. Staff turnover may drop. Sick leave may drop. The firm may become a happier place to be and a happier place to work.

So why not pause for a moment and consider whether you and your firm are contributing enough on the charitable side. There are many good reasons why it will benefit your firm.

However what is more important is that it will benefit the local community as well. That way you and your firm can create a legacy for good. 

Geraint Jones is a tax partner at BKL Tax

He writes the regular in-practice article on doing business for Private Client Adviser