It is remarkably important for brands to give back to the community, including by donating some of their time and other resources toward helping worthy causes. However, not all charities and nonprofits are worth your time: Some lack transparency, while others may have management issues or other potential problems.
So how can companies decide who best to support? To find out more, we asked a panel of Young Entrepreneur Council members what qualities business leaders should look for in a charitable or nonprofit organization. These answers are provided by Young Entrepreneur Council (YEC), an invite-only organization of the world's most successful young entrepreneurs.
1. Transparency
"I think it's important that nonprofits are transparent with their donors and the general public. If you want people to trust and support you, you have to give people a reason to see that you're trustworthy. Once a charity is viewed as unethical, it's hard to recover from that title." – Syed Balkhi, WPBeginner
2. Great results and accomplishments
"Before I'm willing to invest in a charity, I want to know what they have accomplished in the past. Are they known for helping out in disastrous situations, or do they only show up when things are at ease and they want donations?" – Blair Williams, MemberPress
3. How the charity uses donations
"Actually seeing or knowing how the charity uses their donation is important to many people. With some charities, they lay out exactly what your donation is going to be used for, while with others it's a little vague. Decide if knowing exactly how your donation is going to help is important to you when choosing a charity to support." – Stephanie Wells, Formidable Forms
4. An informative website
"Does their website detail where the proceeds go and who gets them? Too many organizations claim to give back to the community, yet when you perform research, there's little to no information about where the money goes. If this is the case, it's best to stay away. Charities that have nothing to hide will tell their audience everything, so withholding information is a bad sign." – Jared Atchison, WPForms
5. Good recommendations
"Are there charities or organizations that your loved ones like to donate to? If so, you can ask their opinion and see if it's something you'd also like to participate in. It doesn't mean that your friends and family have all the answers about an organization's legitimacy, but it brings you one step closer to finding one." – Chris Christoff, MonsterInsights
6. Alignment with your ideology
"The most important thing to look for when considering a charity is if it aligns with what you stand for. It would make no sense to donate time and funds to a group that has nothing to do with what you are after. If you do get behind a charity that is in sync with your ideology, your customers are more likely to back both you and the charity." – Colbey Pfund, LFNT Distribution
7. Proximity to your business
"Your mission should align with your chosen nonprofit, you should have the financial security of the nonprofit 501(c)(3) status, and you should plan involvement. If you passively give income or you would like to incorporate a nonprofit as part of your company culture, proximity is key. We support Girl Power in Miami because of its mission and because we like to support Girl Power with funds and time." – Matthew Capala, Alphametic
8. Administrative costs
"A charity or nonprofit worth its salt is one whose administrative costs are no more than 25%, with 75% of revenues going towards the cause. This is important because it means that the organization is truly helping out." – Andrew Schrage, Money Crashers Personal Finance
9. Legitimacy
"Make sure the charity is legit. It seems like so many charities raise money for their CEOs rather than the causes they claim to support. Make sure the charities are actually doing good in the world. Before you make a donation, make sure the charity is a tax-exempt organization by checking its Form 990. Also, search for the charity's budget breakdown on a website such as CharityWatch." – Jeff Pitta, Medicare Plan Finder
10. Support for your team's charitable work
"Here's a simple rule to follow when deciding on what charitable causes your organization should support: Support 100% of the charitable work of your team. Here's my rule: If you've ever worked at one of my companies and you request support for a cause, the answer is always yes! This simple commitment will demonstrate your loyalty to staff while supporting meaningful causes." – Kristopher Brian Jones, LSEO.com
11. The charity's leadership
"When evaluating whether a charity is worth supporting, one must evaluate the leader of the charity. When you find a nonprofit that has a mission you believe in, make sure that you have confidence in the person or people leading the charge or you may find yourself disappointed. Effective leadership is integral to the success of any organization, your cause of choice included." – Adam Mendler, The Veloz Group
12. Support from your customer base
"It is important to understand the values that your customer base is most likely going to rally behind. When choosing a charity, it is fundamental to support one that is driven to create the change most desired by your client base. This is a great way to not just create a positive impact on society but also to create relatability with your customers on issues beyond sales and marketing." – Abeer Raza, TekRevol
13. Credibility and integrity
"When determining whether a charity or nonprofit is worth supporting, a business leader should look into the organization's history to check credibility and integrity. See where the donations go and how much of it actually benefits the people the organization represents. While this may seem skeptical, charity and nonprofit transparency are important, as it helps the resources go to people in need." –David Chen, Sharebert
14. Whether the charity solves a real issue in the world
"When supporting a charity or nonprofit, it's crucial to see that you and your company believe in it and that it's aligned with the mission and purpose of your business. I would also make sure that the charity or nonprofit is transparent and that it helps to solve a real issue that the world faces. These elements are so important because they will relate directly to the image of your company." –Alfredo Atanacio, Uassist.ME
15. A clear purpose that supports your own goals
"It's important to dig deeper and go beyond the basic information on revenue, fundraising and spending. Start by identifying its primary purpose. Different charities have different missions. Does what they care about align with what you care about? Would supporting an organization further what you hope to accomplish? Determining the heart of a charity is important before diving in." –Blair Thomas, eMerchantBroker