Non-profits use a range of fundraising strategies to increase revenue. There are peer-to-peer campaigns, special giving events, and often a holiday push for donations. But aside from these programs, there is one type of program that really stands out because it benefits both the employees of a corporation and non-profits: this method is called corporate matching or matching gift programs.
Corporate matching gifts are a type of corporate philanthropy giving program that is set up by companies and corporations as an employee benefit. After an employee donates to a nonprofit, they can submit a matching gift request to their employer and the company will make an additional donation to that nonprofit.
Out of all of the funding sources available to non-profits, corporate matching programs are truly some of the best for reaching revenue goals so non-profits can successfully carry out their missions.
In this article, we will go into depth about the ins and outs of matching gift programs. Whether you are a manager at a corporation, an employee looking to do good, or a non-profit organization looking for sources of funding, the information in this article is sure to be instructive in how you can implement your own goals.
Why do Companies Implement Matching Gift Programs?
65% of fortune 500 companies offer matching gift programs, and a ton of smaller businesses are following suit and offering the opportunity, too. This begs the question: why?
Companies of all sizes match donations their employees make to nonprofits because it’s an easy, structured way for them to support good work in their communities. CSR, or corporate social responsibility, is an important factor in how the public perceives brands and companies these days.
Corporate matching gifts are an efficient and straightforward way for companies to build relationships with charities.
Why do Non-Profits often Overlook Corporate Matching Gifts?
Nonprofits often struggle with receiving these gifts because so few donors know about their employer’s corporate philanthropy programs. Nonprofits also don’t always know who someone’s employer is or what their specific policy is.
Communicating guidelines and instructions, especially on a wide scale, can be difficult, so nonprofits frequently choose to focus their efforts on traditional fundraising strategies.
But just because there are typically some difficulties in getting funds from matching gift programs does not by any means mean that your non-profit should not look for matching gift opportunities. It can be a good idea for your non-profit to do research on what companies are doing matching gift programs and then engage in outreach among the employees to make them aware, not only of the matching gift program at their company (that they may not even be aware of) but also your non-profit, its mission, and why they should donate to your cause. Later in this article, we will discuss more in-depth the way your non-profit can increase revenue from matching-gift programs.
What are the Major Elements of Matching Gift Programs?
Every matching gift program is certainly unique to the company that implements the program, but each matching gift program will have a certain amount of similar elements that make a matching gift program what it is. These are as follows:
Match ratio: The match ratio refers to the amount of money a company will pay in relation to the original donation made by the employee. A 1:1 ratio means that a company will donate the exact same amount. The match ratio can be anywhere from .5:1 to 3:1, though it is most commonly 1:1 or 2:1.
Minimums and maximums: Matching gift programs will almost always specify a minimum and maximum amount for qualifying donations. If an employee donates less than the minimum, they are not eligible for a match. If they donate more, they are only eligible for as much as the specified maximum amount.
Employee status: Sometimes the match ratio, or even an employee’s eligibility, depends on the employee’s status. For example, a part-time employee might be eligible for a 1:1 match, while a CEO of the same company qualifies for a 2:1 match. Often retired employees are eligible for matching gifts as well, though sometimes at a reduced ratio.
Type of organization: Some companies will narrow their matching gift programs to organizations of a certain kind. For example, some companies will not donate to organizations with religious goals, though they are technically classified as a 501(c)(3).
Deadlines: It is important to check your guidelines specifically for the deadline for requesting matching gifts. Some companies put their deadline at the end of the year, while some use Tax Day as their cutoff.
These are the major components of any matching gift program. While it is important to know these elements (because you will see them time and again as you navigate the matching-gift terrain), it's also important to remember that each matching gift program is unique and will require that you research the specificities of each promising program you come across.
What Non-Profits are Eligible for Matching Gifts
Companies often place stipulations regarding which organizations are eligible to receive a match. However, a majority of companies will match donations to these types of organizations:
Educational institutions: Colleges, universities, K-12 schools, educational foundations.
Arts and cultural organizations: Aquariums, libraries, museums, etc.
Community-based social services: Homeless shelters, animal shelters, low-income assistance, etc.
Environmental organizations: Conservation efforts, wildlife preservation, recycling, etc.
Healthcare organizations: Hospitals, substance abuse programs, medical research, etc.
Other companies might restrict their nonprofit eligibility to nonprofits falling into one or multiple of the above categories. A few common restrictions include political organizations, sports teams, and religious organizations that lack a focus on community outreach.
Prominent Gift Matching Programs
As you and your non-profit continue to navigate opportunities for matching gifts, there are a few notable matching gift programs that you will be sure to want to pay attention to. The companies listed below have shown a deep commitment to matching gifts for long periods of time, and your non-profit would be sure to benefit from learning more about what makes these programs special.
General Electric: GE Foundation created the concept of corporate matching gift programs in 1954. Through its matching gift program, General Electric empowers full-time and part-time employees to request matches from all sorts of organizations.
They match at a 1:1 ratio for donations between $25 to $5,000. They also have a generous deadline for requesting a matching gift. Matches must be requested by April 15th of the year following the initial donation. The program isn’t limited to just U.S.-based nonprofits either; many UK-based organizations can get in on the action, too. Last year alone, they donated $16.8 million in matching gifts.
BP: BP is unique in that it will match, in addition to personal donations, all money raised by an employee. So if a BP employee raises $5,000 in a peer-to-peer fundraiser, they can have that entire $5,000 matched.
Microsoft: To date, Microsoft employees have donated more than $1 billion since 1983. This amount continues to rise with $221 million donated by Microsoft employees last year. Microsoft strives to maximize its corporate giving in October, when the company hosts over 300 activities, such as 5Ks and auctions, to raise funds for nonprofits. However, they offer their matching gift program year-round.
Microsoft matches donations between $1 and $15,000 at a 1:1 ratio. Full-time employees, spouses, board members, and part-time employees are eligible to submit requests. Most nonprofits are eligible. As part of their commitment to empowering nonprofits worldwide, they also donate and discount the Microsoft Cloud for more than 165,000 organizations, which showcases their passion for supporting charitable causes.
Apple: Apple Inc. has a match ratio of 2:1 for all employees! Plus, they offer volunteer grants of $50/hour, which is much higher than usual.
Verizon: Under the Verizon Matching Incentive Program, the Verizon Foundation will match full-time and part-time employees’ donations to a wide range of nonprofit organizations. For every dollar an employee donates, the Verizon Foundation matches the gift at a 1:1 ratio for up to $1,000 to most nonprofits each year. If an employee donates to a college or university the matching gift limit is upped to $5,000 per employee per year to higher education institutions.
The program is extended to retired employees. However, the company focuses strictly on scholarships and curriculum development with this extension, so they’ll only match retirees’ donations to higher education institutions.
They also offer another type of matching gift through their Team Champions program. When teams of 10 or more Verizon employees collectively raise funds for a nonprofit or school, the company will match the funds raised up to $10,000 per team and event. As a direct result of this generosity, Verizon contributed an additional $8.5 million in matching gifts to schools and nonprofits in 2019.
Soros Fund Management: Soros Fund Management ranks as having one of the most generous corporate giving programs out there. With an admirable 2:1 match ratio, employees can make a notable impact on any size donation from $25 to $100,000 per year. In other words, if they donated the full $100,000, the company would donate an additional $200,000, totaling to $300,000 for the cause.
With this type of generosity comes a few stipulations. For instance, the program is limited to full-time employees. That way, they can continue funding the full amount of these requests.
Others: There are a number of other companies with gift matching programs worth mentioning if not in-depth: Johnson & Johnson, CarMax, ExxonMobil, State Street Corporation, and Gap Corporation.
How Your Non-Profit Can Collect Matching Gifts
Though each program is unique, the steps for collecting matching gifts are actually quite uniform. The process consists of the following five steps:
1. An employee makes the initial donation: The first step is always that initial donation. There can be no matching gift without an initial gift to match. This is also why outreach to employees is so important.
2. Employee submits a matching gift request: This is the most crucial step in the process. A donor must take a few minutes to request the matching gift from their employer. A nonprofit organization or educational institution can not make that request, even when they know that a donor is eligible.
3. Employer checks donation eligibility: Often companies will have someone on staff who is dedicated to matching gifts. This person (or team) will make sure that a donation is within the specified minimum and maximum amounts, check the employee’s employment status and make sure that the organization itself is covered by the program guidelines.
4. Employer verifies donation: Once the donation is verified as match-eligible, the company will contact the nonprofit organization or educational institution to confirm the donation amount, date, and donor.
5. The organization collects the matching gift: The last stage, of course, is when the organization receives that matching gift from a company.
How to Increase Matching Gift Revenue For Your Non-Profit
The biggest hurdle to collecting matching gift revenue is a lack of donor awareness. Not only do donors not know if they are eligible for matching gift programs, but they also don’t even know what matching gifts are.
A donor is more likely to submit a matching gift request if you can ease the process for them. Double the Donation has created a search tool that allows donors to search through an extensive matching gift database of more than 20,000 companies and subsidiaries to find if their employer offers matching gifts.
Marketing matching gifts is the single most crucial action an organization can take toward increasing matching gift revenue. And with matching gift revenue basically being free money, it’s hard to come up with reasons not to take advantage of this.
In short, your organization should mention matching gifts wherever you can. A matching gift search tool embedded or linked throughout your website and communications can be an incredible way to increase funding from matching gifts.
Funding Your Non-Profit with Matching Gifts
As we have talked about in this article, employee matching gift initiatives are a great way for non-profits to get sources of funding. The key is to identify matching gift companies and then conduct outreach to employees, informing them about your organization and their company's program for matching funds, and the ways employees can submit match requests. This may take some work, but the payoff for your non-profit will be well worth it. Of course, this does not mean that your non-profit should abandon other ways of fundraising, such as asking for individual donations.