The Numbers Are In: Corporate Generosity Boosts Employee Engagement

By Anna Johansson

For centuries, leading businesses have earmarked portions of their revenue to go to charitable causes. And while the primary reason for charitable giving is obviously to benefit the people and groups involved, it’s hard to ignore the fact that generosity makes the giver feel good. But did you know that it also makes employees feel good when their employers are generous?

Understanding the psychology of giving

It may sound weird for someone who has never given anything of value to someone else, but the giver often benefits more than the recipient. That’s because it feels good to give.

Mitchel Popovetsky, M.D., a primary care physician at Rush University Medical Center, has spent a lot of time studying the psychological benefits of giving. The insights he gleaned from researching this topic are pretty fascinating.

One of the studies Popovetsky likes to talk about involved performing functional MRI scans on the brains of charitable donors. It showed that the mesolimbic portion of the brain lights up after donating.

“This is the part of the brain that controls feelings of reward and pleasure. It’s also activated by things like food, drugs and sex,” Popovetsky says. “But that’s just the physiology of it.” There are also a number of other psychological and health-related benefits associated with giving.

Corporate giving and employee engagement

When you consider that employees feel connected to their employer and identify with the decisions these companies make, you start to understand how corporate generosity plays such a major role in bettering employee engagement.

Whether it’s through direct employee giving – in the form of volunteering or charitable donations – or the company itself sponsoring a cause, research shows that individuals feel a greater sense of job satisfaction when there is generosity involved.

According to a Deloitte Volunteer Impact Survey of employed millennials, those who frequently participate in volunteer activities in the workplace are twice as likely to report being “very satisfied” with their careers.

As a separate study explains: “Employee engagement through cause is a vital means by which to strengthen employee relationships, enhance employee morale and even build critical skill sets and expertise. Plus, employees are hungry for ways to get involved in cause.”

The connection between corporate generosity and improved employee relations can be tied back to a few specific benefits in the following areas:

• Better productivity. When employees feel like their goals are aligned with the company’s goals, productivity is naturally increased. Everyone is on the same page, and there’s less friction between individual parts of the team. This idea is supported by a 2015 study conducted by professors at the University of Southampton in the UK. It shows a strong positive correlation between employee-directed corporate philanthropy and workplace productivity.


• More pride. Pride is a big deal when it comes to connecting with employees. When an employee is aware of the company’s vision – and that vision doesn’t embarrass them – they’re much more apt to speak out in a positive fashion. One study, conducted by a team of researchers from the University of Notre Dame’s Mendoza College of Business, supports this theory. The findings from this study reveal that employees tend to have a more positive view of their employers when the company is committed to corporate giving. Specifically, emotional engagement is higher.


• Morale boost. In his research, Popovetsky found that people who are natural givers have greater self-esteem and more satisfaction with life. This is because they’re able to look beyond themselves and recognize what really matters in life.


• Better health. Popovetsky also points to a number of studies that show volunteering can lead to better mental and physical health. Specifically, people who are generous tend to have less belly fat, lower cholesterol and lower blood pressure.

The benefits of corporate generosity are clear. The only problem is that many businesses are not honoring their employees’ wishes. This represents a huge missed opportunity in organizations around the world.

Make generosity a CSR priority

You can’t include everything and everyone in your corporate social responsibility initiatives. But if you want to maximize the return on your investment, it’s wise to include some form of generosity toward others. Not only does this provide your organization with a chance to give back, but it also enhances employee engagement.

On a related note: Make sure you include employees in the selection process. Some companies do this by offering what are called “prosocial bonuses.” This is money given to employees with the expectation that they’ll pass it along to someone in need.

“Lots of employers do this with match programs, like the one at Microsoft, where for every dollar the employee pays to a charity, the employer matches. This again helps develop a feeling of teamship and allows the employees to give to the charity of their choice, for a cause that’s close to them personally,” executive coach Angie Buchholz noted in a blog post.

Not sure where to start? “Setting up prosocial programs can be as easy as giving employees vouchers for a job well done, allowing them to give that voucher to the charity of their choice. This is a dual natured way of improving morale, as it gives the employees individual recognition, while allowing them to give back to a charity they care about,” Buchholz advised.

Once you understand the relationship between corporate generosity and employee engagement, you’ll see a world of new opportunities emerge. What will you choose to do?

Image credit: Pixabay

Anna is a freelance writer, researcher, and business consultant. A columnist for Entrepreneur.com, HuffingtonPost.com and more, Anna specializes in entrepreneurship, technology, and social media trends. Follow her on Twitter and LinkedIn.