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While Hannibal Brumskine, chief financial and operations officer with the National Credit Union Foundation, thinks it’s great that credit unions sponsor a variety of charitable endeavors, he advises credit unions to devote most of their charity to longer-term, higher-impact initiatives driven by the credit union’s mission.
He advocates “strategic philanthropy,” a type of giving focused on investing in two things that can ultimately benefit your credit union:
Brumskine, a CPA, has held high-level financial and compliance positions at charitable organizations such as Goodwill and Special Olympics. Based on the most effective credit union giving programs he’s seen, he recommends taking three steps to put your credit union on the strategic philanthropy path:
1. Tie giving to your core mission
“If the charitable efforts of a credit union are aligned strategically with its mission, we generally see a longer-term commitment towards seeing tangible results,” says Brumskine.
He adds that a credit union’s commitment tends to be even stronger when they collaborate with other organizations that have complementary missions.
For example, if one of your core missions is affordable housing in your community, you may already be working with local and state agencies that help first-time home buyers.
But have you considered also working with organizations that address the root causes of poverty and homelessness? Do you have strategic, long-term commitments with these organizations?
2. Track the results of your charitable activities
Brumskine recommends that credit unions establish measurable goals for their charitable activities and follow through by documenting the results. Share the positive impacts you’re making in your community widely through your public relations channels, including social media.
Publicizing how much money you donate is fine. But you should also look for opportunities to show your employees volunteering.
This has more emotional appeal than just dollars—and it may encourage others in the community to pitch in.
3. Invest in local, state/regional, and national financial health initiatives
One mission credit unions all have in common is promoting members’ financial health. This, in turn, bolsters credit unions’ financial health. But even more, putting the financial health of members and the community first is what will keep the credit union industry intact.
“As not-for-profit, tax-exempt organizations, credit unions have a social mission to fulfill,” says Brumskine. “That's one of the reasons they've maintained their tax exemption.”
The foundation offers training and other resources for credit union professionals to teach strategic philanthropy and how it can differentiate credit unions as uniquely socially responsible financial organizations. Many state and regional credit union associations also offer this type of training, often in conjunction with the foundation.
In addition to their local philanthropy, it’s a good investment for credit unions to donate money to these organizations to help them expand their training programs, as well as making highly visible donations for financial health and disaster relief programs.
Creating an effective strategic philanthropy program requires buy-in from the board, executives, and employees. Brumskine suggests a planning session at least once per year.
And he recommends that credit unions consider setting up a charitable donation account (CDA).
“Establishing the CDA forces credit unions to step back and take a strategic approach to their giving,” Brumskine says. “It helps them establish their priorities as opposed to waiting and reacting to people knocking on the door and asking for money.”