Too often, when a client or contact asks for sponsorship money, law firms simply ask where to sign. When a partner requests that the firm sponsor their child’s (school/sports team), it’s hard to say no. When a staff member requests that the firm support an event or charity they are involved in, it’s easier for the firm to say no but at what ultimate cost?
While on one hand I’m the plan queen, on the other I fully admit that it’s impossible to know how you’ll be spending your sponsorship and charitable budgets a year in advance because too often, those requests come in on short notice throughout the year. That said, there are things you can do to better manage these decisions so they don’t break the bank, are better thought through, and are more closely aligned with your business goals.
- Have a budget: There should never be an undefined, bottomless financial pit available for sponsorships and charitable donations (cd’s). As part of your expense budget development (created between October and December of the prior year), include line items for each of sponsorship and cd’s. Don’t group them together because they aren’t the same thing. Sponsorships are part of marketing, as the impetus for involvement is usually marketing-related and as the benefits of participation are almost purely marketing ones. Cd’s are part of institutional expenses. They might have a marketing benefit, or they might not but marketing should not be the only or primary goal.
- Have policies in place: Decisions to spend in either area should be guided by the development of policies on how we will make such decisions. For example, I worked with a firm that had declared that sponsorship decisions would be made in the following order of priority:
- Top client requests
- Client requests
- Partner requests (where that partner was actively involved)
- Lawyer requests (where that lawyer was actively involved)
- Staff requests (where that staff member was actively involved)
- Requests related to a marketing target.
- All other lawyer and staff requests.
- There being no connection with the firm, request denied.
Other elements of the policy might include points # 5 and #6, below. This doesn’t mean that anything that falls within a to g will get funded. It is simply the priority of consideration.
Cd’s, on the other hand, are more altruistic in nature. Some priority might be placed on charities where members of the firm are actively involved. But the bulk of your budget might simply go to causes with which you would like to align the firm. Examples might include certain health issues or dedication to a particular hospital; education and child safety; etc. Create as much structure as possible to your decision-making processes so it will be easier to know what to say yes or no to.
- Have a committee: A policy is a great start. The next step is to have a team who accepts requests, runs them through the policy and makes a yes/no and amount decision. You could have one person deal with this but it will be easier on them and the firm if you have two or more serve in this capacity.
- Have a submissions process: Avoid having partners try to sell you in the elevator or dropping a client request on your desk and expecting you to make the magic happen from there. Insist on a submission process. Have a form that must be completed. Declare a timeline required for due consideration (i.e. submissions should not land on your desk the day before a response is due!) The form should identify all pertinent information, including any history (such as whether we sponsored this event before and if so, what our involvement look like and what was the outcome, if any) and include reference to point #5 below.
- Insist on a champion/participant: Prioritize those events where a lawyer will be actively taking place. Gone should be the days where someone asks you to sponsor something that they won’t be bothering to attend. If the firm’s name is behind it, then someone from the firm should be working that crowd brilliantly. (And sending your articled students doesn’t count). Every sponsorship should require an ACTIVE champion.
- Have a follow-up process: Immediately following a sponsored event, the person who requested the sponsorship (and hopefully attended the event) should be required to submit a report confirming the event took place, that the firm obtained the benefits promised by organizers, outlining who attended on behalf of the firm, describing who attended the event generally and noting any clients or other points of contact, and determining whether the event was worth it and if it should be considered again next year. The report can also state any suggested improvements to the firm’s future involvement in the event.
- Keep records: This includes the original request, written confirmation of sponsorship or donation, copies of all relevant correspondence with the event organizers, and a copy of the final report. This should be kept in a file and available in case the same or similar request is made the following year. This information is also handy for the final year-end report for that line item (often by the marketing department in the case of sponsorships).
A final note on CD’s:
Some firms pick a cause and dedicate 100% of their budget to that cause. I would suggest the firm reserve some funds to provide some charitable support to causes close to lawyers and staff. Most firms say they care about the communities in which they live and work. Purely altruistic donations are a great way to prove it. But you can also win huge brownie points by supporting the charitable interests of your own lawyers and staff. And frankly, it’s difficult for members of a firm to accept that an organization that is making $10m+ doesn’t have the funds to support the charities close to the hearts of those who work there. Even a $250 donation to their favorite charity can go a long way to their greater job satisfaction.
Heather Gray-Grant is a business strategist, marketing expert and executive coach for law firms and lawyers. She can be reached at firstname.lastname@example.org