How to apply

This section gives basic information on identifying potential companies to approach, how to establish contact with them and how to put together a proposal for them to consider.


Corporate social responsibility

Corporate social responsibility (CSR) is a much bandied about phrase which seeks to define what an increasing number of people and groups believe the wider role of business in society should be. This guide deals with one aspect of CSR which, broadly speaking, is the philanthropic. The term, however, is also current in the context of respect for human rights and the environment, for example. Despite the increasing interest in the issue of CSR (as witnessed by the number of articles, journals and conferences appearing around the topic), it should be remembered that company giving is way below that of the general public and, to a lesser extent, charitable trusts. Out of a total voluntary sector income in 2003 of £20.8 billion, government contracts contributed 37.0 per cent, the general public 36.6 per cent, charitable trusts 6.6 per cent, and business 4.3 per cent. Nevertheless, ethical issues aside, companies remain an important target for both national and local fundraising.

To make an effective appeal to industry you must have a basic understanding of why firms give. This will enable you to be put forward good reasons why they should support your work. Many companies, especially the larger, higher profile ones, receive hundreds, if not thousands, of requests for support from charities, voluntary sector organisations and local community groups each year. For your appeal to be successful it needs to be more than a general plea to 'put something back into the community'. You can help a company justify its charitable support by telling them not just why you want the money, but why giving you support should be of interest to them. You can also tell them about any benefits they will get in return for their money and about the impact their donation will have on your work. At the very least you should be able to demonstrate a clear link with the company through either, geographical, product, employee contact or, some other connection.

Why companies give
Most companies give out of enlightened self-interest rather than for pure altruistic or philanthropic reasons, and see their giving in terms of 'community involvement' or 'community investment'. The main reasons why companies give are:

  • To create goodwill. Companies like to be seen as good citizens in the communities in which they operate and as a caring company by society as large
  • To be associated with causes that relate to their business. Mining or extraction companies often like to support environmental projects, for example
  • To build good relations with employees. Support for employee volunteering is a growing area of company giving, creating a 'feel good' factor amongst employees and a sense of loyalty to their socially responsible employer. Increasingly some preference is given to those charities for which staff are raising money or for whom staff members are doing volunteer work. Funds raised may be matched (usually up to a set limit) and/or employees given work time off in which to volunteer.
  • Because they are asked or it is expected of them. They also don't want to be seen as mean in relation to other rival companies in their particular business sector. They are concerned that the quantity and quality of their giving is appropriate to their status as a company.
  • Because the chairman/senior directors are interested in a particular cause (and perhaps support it personally). This is quite often the case with smaller companies where, as a result, it can be difficult to get a donation for causes outside of this criteria. Unless you know a friend of the managing director to plead your case, success is unlikely.
  • Because they have always given. Some companies never review their donation policy. They see their donations more as an annual subscription to a list of charities they wish to support each year. Your aim should be to get your charity's name on to such a list, where it exists.

It is worth pointing out that a certain amount of chaos exists in company giving. Outside of the largest givers, few companies have any real policy for their charitable giving. Mostly they cover a wide range of causes, or attempt to deal with each appeal on its merits. For privately-owned or family-controlled companies their giving is often little different from personal giving. For public companies, where it is the shareholder's funds that are being given away, there is pressure to dress up what they are doing, perhaps by claiming to give according to some well-defined criteria.

However, some companies do have clear policies. Where such policies are printed, please respect them. Dealing with a mass of clearly inappropriate applications is the single biggest headache in corporate giving and has caused some to consider winding-up their charitable support programme all together. Don't jeopardize someone else's chance of success by your own indiscriminate applications.


What companies give

Many charities are unrealistic about what they might obtain from companies as, to use an oft-quoted phrase, 'the business of business is business'. In other words, corporate charitable support is often only a sideline. Taking the top 400 UK corporate givers of 2003/04 as an example, their combined cash donations of £580 million represented a mere 0.27% of their total pre-tax profits. As such, expectations of large, generous donations or long-term commitments should generally be avoided.

However, much company support lies outside of cash donations. In fact, for many of the larger donors' cash donations are a decreasing percentage of their total giving. For smaller givers, however, cash will continue to remain their most common form of support for charities. Here, then, are a variety of ways in which companies can support charities:

  • Support in kind, which includes giving company products or surplus office equipment; providing use of company facilities, including meeting rooms, printing or design facilities, help with mailings
  • 'Secondment' of a member of staff to work with the charity, where a member of the company's staff helps on an agreed basis whilst remaining employed (and paid) by the company
  • Providing expertise and advise, whether by contributing a senior member of staff to the charity's management board, or over the telephone on a one-off basis
  • Encouraging employees to volunteer, undertake fundraising drives, or support a payroll giving scheme
  • Sponsorship of an event, activity or award scheme
  • Sponsorship of promotional or educational activities. Note: Some companies handle sponsorship through their community affairs department, whilst other do so through the marketing department. In smaller firms donations and sponsorship are usually handled by the managing director.
  • Cause-related marketing, where, to encourage sales of a particular product, the company contributes a donation to a specified charity in return for each linked product sold. This is becoming an increasingly common form of support, but not usually to the benefit of smaller, less attractive charities.
  • Advertising in charity brochures, newsletters, annual reports and so on. Smaller companies are often prepared to give in this way, if asked. For larger companies, however, it is usually something they exclude as standard as the initial approach is often made by a third-party who would also receive a share of the donation.


The types of companies that give

Multinational companies - Most multinational companies have global giving programmes, generally tied to areas where they have or are developing business interests. Some multinational companies have an international structure for managing their giving, with budgets set for each area and a common policy regarding what they wish to support. With others, community investment remains at the discretion of local company management in the country concerned.

Geographically speaking, the further out from the centre (i.e. the companies headquarters) you are, the less you can expect to get. This can be broken down as follows: (i) most money is spent in the headquarters town or region; (ii) most money is spent in the home country of the company; (iii) more money is spent in developed countries than developing ones.

Leading national companies - These will be supporting large national charities; have their own sponsorship schemes; make smaller donations to local charities in the area in which they are headquartered or have a major business presence. Numerous national companies will make grants through regional offices, whilst retail stores such as B&Q will use the local store manager to give advice on a local application. Such stores may also provide the manager with a small budget to spend at their discretion.

Larger local companies - In any city or region there will be large companies who are important to the local economy. They will often feel a responsibility to support voluntary action and community initiatives in those areas, and value the good publicity this provides.

There are also companies with a regional remit. the water, electricity and independent television companies all have a specific geographical are within which they operate, even if they are part of a multinational company.

Smaller local companies - There are a myriad of companies that make up the local business community. Referred to as Small and Medium Enterprises (SME's), they are often overlooked in the rush to target the large companies on which good information is generally available. However, from manufacturers on trading estates to accountants and solicitors in the high street, the majority of SME's claim to be involved with their local community. A MORI poll in 2000 surveyed 200 managing directors of firms ranging in size from 20 to 1,000 employees. 16% said they are involved 'a great deal' with their local community and 45% said they are involved 'a fair amount'. Many of these companies are privately owned, so the best approach will often be through the managing director or senior partner.


Key factors in approaching companies

Research
Research is very important, not just into companies, but also into personal contacts. When planning an appeal, an important first step is to find which of the people associated with your charity have influence or know people who have. If you can find a link between one of your supporters and a particular company - use it.

  • One of your trustees/members may be on the board of directors or have contacts there - it will prove useful for them to write or sign the appeal letter.
  • One of your volunteers or supporters may be an employee of the company.
  • Your clients/users (or their parents) may work for the company.

Alternatively, you might be able to tie your appeal in to a known personal interest of a director.

Getting in touch
Generally an appeal through a personal contact will work the best. But if you haven't got a contact and can see no way of developing one, then you will have to come up with another link.

As a first step you might contact the company to find out the following:

  • who is responsible for dealing with charitable appeals
  • their name and job title
  • what information they can send regarding their company
  • any procedure or timetable for submitting applications
  • whether they might be interested in coming to see your organisation at work.

Visits are useful when discussing bigger donations with the larger companies, but are difficult to arrange for anything small.

Almost certainly your appeal will be in the form of a letter. Make this as personal as you can. Circular letters tend to end up in the bin. Make the letter short and to the point.

Be specific in your approach
Rather than sending out a circular mailing to 100 or 1,000 companies, you will be more successful if you select a few companies you believe will be particularly interested in your project, and target your application to them and their policy. (Many companies will not consider circular appeals as a point of policy.)

Find a good reason why you believe the company should support you and include this prominently in your letter. You may be able to relate what you are doing as a charity to companies which have some relevance to your work: for example, a children's charity can appeal to companies making children's products; a housing charity to construction companies, building societies, etc. Any relationship, however tenuous, creates a point of contact on which you can build a good case for obtaining the company's support. If there is no relationship, should you be approaching that company at all?

There may be occasions where a charity will not want to accept money from a company in a related industry. A health education charity may not want to accept money from a tobacco company or brewery or from the confectionery industry, or similarly an environmental group may not wish to accept a donation from a nuclear power company. Such charities may feel that if they did so they would be seen to be compromised. Similarly, a local charity might not want money from a company who has made people in the area redundant. Each charity has to judge where it draws the line.

Be clear about why you need the money
You must be clear about the objectives of the work you are raising money for, particularly its time-scale and how it relates to your overall programme of work. Try to think in project terms rather than seeking money to cover basic administration costs. This can be difficult, because most people spend most of their money on administration in one form or another, so you need to conjure up projects out of your current activities to present to potential donors. You can build a percentage of administration costs into the costs of a project. If you relate what you are doing to a specific time-scale, this again makes what you are applying for appear more of a project than a contribution to your year-on-year core costs.

Be persistent
Do not underestimate the persistence factor. If you do not receive a donation in the first year, do not assume that the company will never support you. Go back a second and even a third time.

If you are going back, mention the fact that you have applied to the company previously, perhaps saying that you are now presenting something different which may be (you hope) of more interest.

If the company gives you reasons for refusing support, use these to help you put in more appropriate applications in the future. If the response is that the company does not give to your particular type of activity, then you know that it is absolutely no use your going back. If the company said its funds were fully committed, you can try to find out when would be a better time to apply (although this might only have been a convenient excuse because the company did not want to give to you).

Note the response to your appeal and use any information you can glean to improve your chances the next time. People respect persistence, so it really is important to go back again and again.

Identifying which firms to approach
The firms to approach will depend on what sort of organisation you are. If you are a national organisation then an appeal to the country's leading companies is appropriate. Local groups should approach local firms and local branches of national companies which have a presence in their area. All organisations can approach companies in allied fields: for example, theatres can appeal to fabric companies.

You will find the names and other details of companies in a whole series of useful directories.

Sources of information

The Kompass Register of British Industry and Commerce (available in regional sections)
Key British Enterprises
The Waterlow Stock Exchange Year Book
Major Unquoted Companies

Individual company websites

To find key contacts in companies:

The Directory of Directors and Who's Who are useful for finding out more about company directors.
Corporate Register - updated quarterly - a guide to decision makers in UK Stockmarket companies.

The best sources of information on what companies exist in your area are:

  • The local Chamber of Commerce, where most of the more prominent local companies will be members
  • The Kompass Register (available at main libraries), in which companies are organised regionally
  • The local council: the Rating Department might produce a list of major business ratepayers. The Economic Development section may have a list of major employers.
  • The local newspaper(s), which will carry stories from time to time that mention the success or expansion of existing firms, or details of new ones planning to set up in the area
  • The Confederation Of British Industry regional office
  • Companies you have existing contact with. This could include those companies that supply you with goods, your bank, solicitors and/or accountants. Emphasize your organisation's value as a good customer. Ask them if they can provide any useful contacts.

Don't forget, most of these local companies have no donations policy and give to projects which catch the fancy of the managing director or senior partner. Some may never have given anything before, and may not know it is possible to give charitable gifts tax-effectively (via Gift Aid, for example), so you may need to try and persuade them to give. Alternatively, it might be easier to approach these companies for in kind support in the first instance, and later on, once they have given something, ask them to make a cash donation.

Lastly, one big problem you may face involves the ownership of seemingly independent companies. Many companies are in fact part of much larger concerns. In recent years there has been a substantial number of mergers and take-overs, plus the buying and selling of business between corporations. A useful source of information is the directory Who Owns Whom, which has a subsidiary index listing most subsidiaries of companies included in this guide. You can also use company annual reports, which (for most companies) can be obtained on request. These reports provide good background information on the company concerned, and occasionally information on its corporate support programme. Some private (and occasionally public) companies will not send out annual reports except to shareholders; in such cases you can go to Companies House to get hold of a copy. The main offices are situated in Cardiff, Edinburgh, Belfast and London, with satellite offices in Birmingham, Glasgow, Leeds and Manchester.


Before writing a letter of appeal...

You obviously should try to find out as much as you can about the companies you have identified as potential donors. But, remember that:

  • Companies generally have less well defined policies than trusts, although you can often determine a pattern in their giving
  • The chance of an application made 'out of the blue' getting substantial support is low. Appeals made towards the end of a company's financial year are also less likely to succeed.
  • Companies are more conservative in their giving and are less likely to support innovative projects (at least until they have got established) or anything that is risky or controversial
  • Companies policies change more frequently than those of trusts, because of mergers, take-overs, or a fall or rise in profits. So ensure your research is bang up-to-date. Consulting one of the above mentioned directories, or even a copy of the companies latest annual report and accounts is not necessarily enough; they may have been taken over since then. Check the financial press on a regular basis, or make a quick telephone call to see if anything has changed, i.e. company name, address (they may have kept the same telephone number, but moved), your contact, and so on.


Writing a letter of appeal

Firstly, put yourself in the position of the company. Why should they want to give their shareholders' funds to you? Why should they choose your charity's appeal ahead of any others they might receive? Think about the benefits they will get from supporting you and mention these in your letter (for sponsorship proposals these benefits will be central to your success or failure). Then consider the following important points:

  • Think up a project or aspect of your work that the business sector might like to support. Generally, do not appeal for administration costs or a contribution to an endowment fund (although there will be cases where this approach will succeed). Recognise that companies are likely to be interested in some ideas and not others. For example, a drugs charity would be more likely to get money for education than rehabilitation. An appreciation of the kind of projects that companies like to support will be very helpful to you.
  • Your letter should be as short as possible. Try to get it all on one side of A4. You can always supply other information as attachments. Company people are busy. You can help them by making your appeal letter short and to the point. It should be written clearly and concisely and be free from jargon. Someone not acquainted with what you are doing should be able to read and understand it and be persuaded to act on it. Give your letter in draft to someone outside your charity to read and comment on before finalising it and sending it out.
  • You should state why you need the money and exactly how it will be spent. The letter itself should be straightforward. It should include the following information (not necessarily in this order): what the organisation does and some background on how it was set up; whom the organisation serves; why the organisation needs funds; how the donation would be spent if it were to be forthcoming; and why you think the company might be interested in supporting you.
  • You should attempt to communicate the urgency of your appeal. Fundraising is an intensively competitive business; there is a limited amount of money to give away, and you have to ensure that some of it comes your way. If it appears that although you would like the money now it would not matter terribly much if you got it next year, this will put people off. But don't give the impression you are fundraising at the last minute. Show them you are professional and you have carefully planned your fundraising appeal. You should also try to show that your charity is well-run, efficient and cost-effective in how it operates.
  • You should mention why you think the company should support your cause. This could range from rather generalised notions of corporate responsibility and the creation of goodwill in the local community, to much more specific advantages such as preventing children painting graffiti on its factory walls or the good publicity companies will get from supporting your cause. If the firm's generosity is to be made public, for example through advertising or any publicity arising from the gift, then emphasise the goodwill which will accrue to the company. Most companies would say that they do not require any public acknowledgement for the contributions they make, but most will appreciate and welcome this.
  • Ask for something specific. It is all too easy to make a good case and then to mumble something about needing money. Many companies, having been persuaded to give, are not sure how much to give. You can ask a firm to give a donation of a specific amount (matched to what you believe its ability to contribute to be), or to contribute the cost of a particular item. You can suggest a figure by mentioning what other companies are giving. You can mention a total and say how many donations you will need to achieve this. Don't be unreasonable in your expectations. Just because a company is large and rich, it doesn't mean that it makes big grants.
  • If you can demonstrate some form of 'leverage' this will be an added attraction. Company donations on the whole are quite modest, but companies like to feel they are having a substantial impact with the money they spend. If you can show that a small amount of money will enable a much larger project to go ahead, or will release further funds, say, on a matching basis from another source, this will definitely be an advantage.
  • Having written a very short appeal letter, you can append some background support literature. This should not be a 50-page treatise outlining your latest policies but, like your letter, it should be crisp and to the point: a record of your achievements, your latest annual report, press cuttings, or even a specially produced brochure to accompany your appeal.
  • Make sure that the letter is addressed to the correct person at the correct address. It pays to do this background research. Keep all the information on file as it will make your job much easier next time.
  • If you are successful, remember to say thank you; this is an elementary courtesy which is too often forgotten. If the company gives you any substantial amount of money, then you should probably try to keep it in touch with the achievements related to its donation (such as a brief progress report or copies of your annual report or latest publications).
  • If you do not succeed, go back again next year (unless the company says that it is not its policy to support your type of organisation or to give to charity at all). Persistence can pay. If you have received a donation, go back again next year. The company has demonstrated that it is interested in what you are doing and in supporting you. It may well do it again next year, especially if you have thanked it for the donation and kept it in touch with how the 'project' developed.

How companies reply to you
Many companies will not even reply to your appeal. A few may acknowledge receipt of your letter, and occasionally you will get thanked for your request and be told that it is being considered and you will only hear the outcome if you are successful. Up to half of the companies you approach will write back, depending on the spread of the companies you approach. Larger companies have a system for dealing with charity mail, and most will see it as good PR to give a reply. Smaller companies which are not giving much charitable support will not have the time or the resources to do anything but scan the mail and throw most of it in the bin.

What sort of reply should you expect? If you do an extensive appeal, you will inevitably get a lot of refusals. These will normally be in the form of a pre-printed or word-processed letter or a postcard. Occasionally you will get an individually typed letter of reply. If the company says yes, you will get a cheque or a Charities Aid Foundation or Charities Trust voucher. But more often companies will say no.

There may be various reasons given or phrases used by a company which refuses your request. The company may not mean what it says. Funds may still be available for those appeals it wishes to support; it may be able to give support and just not want to; or it may not want to now or in the future. You should try to read between the lines. Companies in trying to be polite may in fact be misleading you if you take what they say at face value.

Some basic don'ts when applying to companies

  • Don't write indiscriminate 'Dear Sir/Madam' circular letters to any company you come across.
  • Don't use any guide you may have access to as a simple mailing list.
  • Don't write to a company which specifically says it does not support your kind of work.
  • Don't write to a company unless at least one of the following applies:
  • The company has a declared policy indicating a specific interest in your group's area of work.
  • The company operates in the same locality as your group and a clear product link exists between your needs and its supplies.
  • You have a strong personal link with a senior company officer, or a member of staff is actively involved in your work.
  • There is some good reason to write to that particular company. The fact that the company makes a profit and your group needs money is not a sufficiently strong link.

The application letter - checklist

  • Is it only one side of A4?
  • Does it state what your link is with the company?
  • Does it stress the benefits to the company?
  • Is it clear why you need the money?
  • Is it clear what you are asking for?
  • Is it addressed to the correct contact?
  • Is it attractive to the company?
  • Is it endorsed?


Sponsorship

Sponsorship is a term that fundraisers sometimes incorrectly use when making what essentially is a request for cash. "Will you sponsor me in the London Marathon" is actually asking for a donation. "Will you sponsor a page in our programme" is usually a request for advertising. Sponsorship is not a glorified donation, and the fact that you are a charity is largely irrelevant. It is a business arrangement. The charity is looking to raise funds for its work and the company wants to improve its image, promote and sell its products or entertain its customers. True commercial sponsorship is a partnership between the donor and the recipient, for mutual benefit.

The bulk of corporate sponsorship money goes to sport. As a charity, however, you will not be competing for a share of the same budget. Rather, you will be concerned with a smaller, but growing 'market', covering social sponsorship. Achieving success here will be no easier a task than if you were competing in the bigger league, but you can increase your chances by doing the following:

  • Identifying possible donors - opportunities can arise not just because of the nature of the sponsorship (access to a target audience or public personalities), but also because the timing is appropriate (A building company is shortly to open a new shopping complex in your town)
  • Preparing a sponsorship package - a written proposal outlining the project and highlighting all the benefits to be gained by the company. This should also include a price for the sponsorship which will reflect as much the benefits to the company as to yourselves.
  • Determining the budget head - this will identify where the money is coming from, who is responsible for it, and what return is expected. The main possible sources are marketing, corporate image and employee relations (human resources department).
  • Making the approach - arrange a face to face meeting with the person who will make the decision (based on the source above) to give a presentation and discuss the sponsorship opportunities. Only then will you be in a position to find out about the companies needs and how you can meet them.
  • Contractual issues - once you have been successful in gaining sponsorship you will need to agree terms through a contract. This sets out a legal agreement about which you will need to be clear in order to avoid possible problems at a later date.

The above is but an outline of some of the major points you will need to consider before seeking out and obtaining a sponsorship deal. For more in-depth advice regarding this see Finding Company Sponsors for Good Causes (Chris Wells), published by Directory of Social Change.