As 2025 began, a groundbreaking Gallup poll revealed that employee engagement, a key indicator of a company’s profit potential, had reached its lowest point in 10 years. Only 31% of employees at US companies, Gallup learned, are engaged at their workplace. For a company of 50,000 employees, that means nearly 35,000 can be considered disengaged.
Companies looking for ways to address their engagement issues can look to nonprofits for a solution. Pedro David Espinoza, founder and CEO of Pan Peru USA, has seen through his work in the nonprofit sector that connecting people with causes they are passionate about outside of the workplace, where they get paid, can boost their performance and make them better employees.
“Research demonstrates that when you have employees volunteer for causes they’re passionate about, employee engagement increases. Companies that take steps to plug people into a deeper purpose, such as giving them time to volunteer or encouraging financial donations to their favorite nonprofits through company matching, make an investment in employee engagement,” Espinoza shares. “Employees can identify themselves with their favorite nonprofits and feel supported by their employers when they match their employee donations, when they give them x hours a month to volunteer at a local nonprofit, or even go on an impact trip.”
A background rooted in empowering communities
Espinoza is a TEDx speaker, entrepreneur, AI investor, and author who founded Pan Peru USA in 2018 to empower women to become entrepreneurs. As the organization evolved, it added sustainability and children’s literacy to its goals, building libraries that promote quality, equitable, and value-based education — family-first values, as well as health values to take care of the body, mind, and soul. To date, it has established 12 libraries, given 10,000 children access to STEM education, and reforested 15,000 trees.
Espinoza developed a deep understanding of nonprofit operations through his work at SmilyGo, a company he founded in 2014 to help Fortune 500 companies invest smarter by matching for-profit corporations with nonprofits to maximize the social impact of each. SmilyGo parsed the data of over 1 million 501(c)(3) US nonprofits to give corporations the insights they needed to make informed decisions on corporate social responsibility investments.
While engaging with nonprofits, Espinoza saw that they had a lot more to offer corporations than opportunities for CSR investing. The models nonprofits use to empower communities can be leveraged by corporations to improve their operations in ways that go far beyond better employee engagement.
Nonprofits fuel innovation with resourcefulness
The current economic climate has forced Fortune 500 companies to seek out ways of becoming more resourceful. Recent reports show they are slashing costs, rethinking supply chains, and generally planning for the worst when it comes to the future.
For nonprofits, resourcefulness is a way of life. It not only empowers them to do more with less, but it also fuels the type of creative thinking that can lead to shoestring innovation.
“Nonprofits excel in their missions despite operating on small budgets and with limited resources,” Espinoza says. “They are often forced to operate with a ‘scarcity mindset,’ which compels them to maximize efficiency and innovation, excel at negotiations, and leverage every freebie they can secure.”
The value of intrapreneurship, which encourages employee empowerment and risk-taking, is another lesson corporations can learn from nonprofits. As companies grow to have staff counts in the tens of thousands, they can lose sight of the value gained from thinking like a startup. Nonprofits excel at that type of thinking, encouraging their employees to solve problems and create value without relying on a big budget to fund their efforts.
Nonprofits seize opportunities with adaptability
As Espinoza worked to build momentum at Pan Peru USA, one of the keys was encouraging adaptability in the community he was serving. The local women he sought to empower viewed their knitting as a hobby rather than a potential revenue stream. Espinoza helped them see they had the skills needed to launch a business, inspiring them to adapt their “operations” in a way that brought abundance into their community and dreams greater than they previously imagined.
With AI disrupting every vertical in the global economy today, corporations have to be ahead of the game when it comes to resilience and adaptability. Companies can learn from NGOs and nonprofits, as many of them operate under tight budgets. Corporations can learn from charities by admiring how they manage their resources, both monetary donations and in-kind donations.
As for-profit companies grow larger, it becomes increasingly challenging for them to adapt rapidly to market changes. Shortening review cycles to increase adaptability is one cue corporations can take from nonprofits. Quarterly (rather than annual) review cycles enable both threats and opportunities to be identified and addressed more quickly.
Flattening hierarchies is another step corporations can take to gain the adaptability seen in nonprofits. By empowering frontline workers with the information and tools they need to make strategic decisions, which is common among nonprofits, corporations can remove the bureaucratic bottlenecks that slow innovation to a crawl.
Nonprofits boost loyalty by investing in relationships
Today’s corporations must overcome a high degree of consumer skepticism as they strive to build and maintain customer loyalty. Looking to nonprofits reveals that investing in community relationships is a key way to achieve that goal.
“The most admired and trusted companies are those that have a connection to their local community,” Espinoza says. “As they build relationships in the zip codes where they have locations, their neighbors get to know who they are and what they are about. As they invest in those zip codes, they emerge as a brand that can be trusted, sparking high levels of customer loyalty.”
Perhaps the biggest lesson corporations can learn from nonprofits is the value that comes from being less corporate. As they take steps to inspire employees, empower adaptability, and build ties with the community, corporations gain a competitive advantage in today’s marketplace.
“In today’s business landscape, maximizing stakeholder value is just as important as maximizing shareholder value,” Espinoza explains. “Companies win when they can show their stakeholders — their neighbors, employees, families of employees, partners, local nonprofits, etc., — that they truly believe we are all in this together.”
