How Companies Can Do Well by Giving Back

In Partnership With WSJ Custom Studios

Corporate donations rose to $20.77 billion in 2017, helping charitable giving in the U.S. cross the $400 billion mark for the first time. For companies, the rewards are both financial and personal.

Anne Hed is on a mission. It's June 1, Day One of the Great Cycle Challenge USA, a national Children's Cancer Research Fund fundraiser. She set a personal goal of 200 miles, and is eager to get riding — and raise as much money as she can by the end of the month.

She's not alone in her fundraising efforts. Hed, the owner of Hed Cycling Products, the Roseville, Minnesota-based manufacturer of bicycle wheels and components, is biking for cancer with her employees, too.

"You get to a point where you start to ask yourself, 'What's my purpose? What's Hed Cycling's purpose?'" she says.

She raises this big question after watching proudly as cyclists using Hed wheels have won international cycling competitions and set triathlon records; after implementing solid health insurance policies and retirement savings plans for her staff; and after working alongside employees for over 30 years, watching them buy homes and send their children to college. All gratifying, Hed says, but there's even more to life.

Anne and her late husband, Steve, opened shop in 1984. "When you're starting a business, it's 100% work to get to the next level and provide for your employees," she says. "But I think it's important to find whatever passion you have and just get out of the office once in a while. The office will still be there when you get back."

She recalls a time years ago when they were hesitant to help out at a Special Olympics ride, struggling to find the time and resources. Eventually, they learned that what they give they get back twofold. "Not only do you come back refreshed and invigorated and realize why you have your company, but your staff also comes back just as inspired as you," she says.

Hed Cycling's spirit of giving started by partnering with a local guild that needed help fixing bikes for their annual garage sale. Anne and Steve got a group of colleagues and employees loaded with tubes and tires to help kids get a chance to ride their first bike. Coincidentally, the money the guild raised went to children's cancer research, too.

The rewards go both ways. "To see employees excited to do something that's usually repetitive, like laying up a wheel, and instead say, 'Today, I'm doing this to help the community' is immeasurable," Hed says.

Breaking Records

Corporate donations rose 8% to $20.77 billion in 2017, helping charitable giving in the U.S. cross the $400 billion mark for the first time. One of the most immediate benefits of corporate donations is the tax deduction businesses can receive. But for Anne, the fiscal reward doesn't compare to the spiritual.

Hed Cycling now partners with 12 nonprofits, from Anne's late husband's favorite childhood camp to her daughter's art center. She lists a few national initiatives her company gets involved in, such as Women Venture, which helps women start businesses; Parenting With a Purpose, which helps kids whose parents are incarcerated; and Be the Match, a bone marrow donor program where Hed Cycling employees sit down with bone marrow transplant patients meeting their donors for the first time.

The cornerstone of giving this year is the Great Cycle Challenge — for personal reasons. "We lost an employee to cancer just last month," Hed says. "It's hitting us really hard."

Now Hed, her employees and her daughter are logging miles, supporting a good cause and each other along the way.

At the end of June, the top three fundraisers will receive a customized Hed three-spoke wheel.

For the record, "customized" doesn't do the wheel justice. It's a piece of art that spins on the wall, created by artists across America who receive a wheel to use as a canvas. In turn, Hed Cycling puts the pieces up for bid at the Steve Hed Memorial Auction, named after Anne's late husband, who died suddenly in 2014.

"This is a special month for us because we lost a friend and now have the opportunity to let all the United States learn about these wheels and the art we make," she says.

Many of the people and nonprofits Anne has helped over the years have been eager to help her now that the shoe is on the other foot. “It's the circle of life," Hed says.

Positive Reinforcement

According to the 2017 Gallup report, "How Millennials Want to Work and Live," only 29% of millennials are emotionally and behaviorally connected to their job and company. Gallup estimates that millennial turnover due to lack of engagement costs the economy $30.5 billion annually.

"For millennials, work must have meaning. They want to work for organizations with a mission and purpose," the report notes. "Compensation is important and must be fair, but it's no longer the driver. The emphasis for this generation has switched from paycheck to purpose ― and so must your culture."

Mindful of her employee's interests, Hed keeps a suggestion box for them to tell her what charities they want the company to work with. "They influence our options for the future," she says.

What's more, every quarter she speaks with her employees about the company's performance, goals and values, listing the names of the charitable organizations they're partnering with. She says that employees often tell her the work they do is important and makes them feel special. They also ask if they can head up next year's garage sale, for example, or help in other ways. "We haven't had a hard time retaining employees or hiring new ones," Hed says, "and I think it's because of the culture we keep."

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