Just a few weeks ago, I was rushing into a neighborhood hole-in-the-wall to pick up my morning chai latte. The barista and I chatted like we did everyday—about our days, our families and my wild 2-year-old’s antics. But something was different that morning—the normally-animated and chatty barista now had a pensive look on his face. As I paid for my order and said good-bye, he replied, ‘I’ll be here for your next cup so I hope you keep coming in.’
Then social distancing and shelter in place hit—closing thousands of small businesses overnight. Today, the economy appears to be in a nosedive. Entire industries—airlines, hotels and resorts, tourism, restaurants and cafes, just to name a few—are now in danger as their customers, whose movement is now restricted and whose tastes are now changing, disappear.
Two sectors are particularly challenged right now. Small businesses are responsible for about 90% of global employment and over half of GDP in developed countries. The nonprofit sector, on the other hand, is our dedicated lifeline to everything from preserving civil rights and delivering essential human services to economic development, and it is now responsible for responding to increased need among vulnerable populations.
All of this begs the question: what can we do to create positive change in response to COVID-19? And, how can companies in particular, help steer that change?
Supporting Small Businesses
Around the world, the majority of people are employed by small- and medium- sized businesses. In developing economies, small businesses play a particularly important role as enterprising individuals can start new businesses with incredibly low risk. In developed economies like the U.S., small businesses contribute not only to the identity of American business but allow for more flexible employment options for people not employable by large companies.
Small businesses worldwide also happen to be some of the hardest hit by the COVID-19 pandemic. With less cash on hand, they cannot afford to pay employees and maintain operations when revenue is down or nonexistent. That’s one of the reasons companies like JPMorgan Chase are kicking off a new wave of support to small businesses. Last week, the company announced a $50 million aid package to help communities recover from the outbreak. Among those grants, $8 million will go immediately to helping small businesses in the U.S., China and Europe.
It’s easy to find a block in any major city all but abandoned. Just a few weeks ago there were corner stores, laundromats, coffee shops and restaurants filled with the sounds of cash registers, casual chit-chat, and servers taking orders. Initiatives like the one JPMorgan has just announced can help bring all of these small businesses—and the people who rely on them—back to life.
What’s inspiring about the company’s announcement isn’t just the direct support to the small business community, but its potential to motivate other philanthropic and business leaders to do the same. “I think there’s a broader recognition within the business community that when you have a crisis like this, and you have a health crisis that impacts our communities in the way that it does, we have a moral and a business obligation to help address that,” Peter Scher, JPMorgan Chase’s head of corporate responsibility said.
Reinvigorating the Nonprofit Sector
As with the global small business community, the nonprofit sector is facing new challenges and nonprofit leaders are desperately looking for their top line. Arts and cultural institutions are losing untold ticket and membership revenue, as their doors remain shut. Humanitarian projects are facing increased demand for food, medicine and essential services from a growing population of people with no income. Meanwhile, all nonprofits face the very real possibility of shrinking donations during an economic recession. With philanthropic support like that of JP Morgan, the sector can sustain the hope to recover and help serve the growing number of people in need around the world.
The JPMorgan initiative includes over $5 million in immediate support to COVID-19 relief; “We are mobilizing the firm’s resources to support customers, employees and communities – especially the most vulnerable – in this time of crisis,” added Peter Scher. A large portion of that will go directly to the World Health Organization to provide masks and other protective gear to the nurses and doctors working tirelessly on the front line of the virus. Other grants will enable humanitarian programs to deliver nutritious meals and much-needed medical supplies to vulnerable populations around the world.
But what is truly encouraging about these gifts is the potential impact on donor confidence—their potential to create a philanthropic domino effect at a time when the world needs one. After seeing JPMorgan’s example, more and more Fortune 500s will surely follow suit by making gifts in their own markets, highlighting the needs of local children, elderly and vulnerable populations along with treasured arts and cultural programming.
In times of crisis, large companies have a key role to play in maintaining social and economic stability. As Jamie Dimon wrote in his own 2017 piece in Fortune , “The private sector plays an essential role in society, and it is a role we should embrace—not just because it’s the right thing to do.”
Large, public donations and initiatives like that from JPMorgan Chase do incredible good—both by providing direct support in areas of urgent need as well as by promoting examples of strong leadership. No matter how big your company, consider making a public commitment to struggling small businesses and nonprofits. In doing so, you do more than just fill immediate gaps. You are helping to create a stronger, more stable world tomorrow.