Building a community - and staff loyalty

Clark Nuber CEO David Katri thinks his firm's charity programs help build employee loyalty.

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(Fortune Small Business) -- Last year Vincent Stevens's church ran an experiment: 10 members were each given $100 to help their communities. Some gave the money away; others used it as seed capital to raise thousands more.

Stevens, 40, a partner in the Bellevue, Wash., accounting firm Clark Nuber, wondered what would happen if his company did something similar. To find out, the company launched Caring, Serving and Giving, a program that lets employees apply for grants of up to $500 to fund community service projects.

The first grant went to senior auditor Hillary Parker, 27. She and a colleague used the cash to turn a local St. Patrick's Day run into a charity fund-raiser that netted $750 to build two pools for rehabilitating marine mammals caught in oil spills.

"I don't think this would have happened without the seed fund," Parker says.

While the program certainly does some good, it's unclear how it helps the bottom line. "It's really hard to put your finger on the ROI," admits CEO David Katri, 59.

But experts say that such programs do tend to boost employee morale.

"Things have shifted over the past 10 years in terms of what employees look for when they join an organization," says Laurie Bienstock, who heads the U.S. strategic rewards group at Watson Wyatt, an international consulting firm. "In general, employees are looking for a more well-rounded approach where they work, so giving them the opportunity to contribute makes a lot of sense."

Whatever Clark Nuber is doing seems to be working. Last year the 160-employee firm's revenue grew 16%, to $30.9 million, slightly better than the industry average of 14.5% for independent accounting firms, according to the Leading Edge Alliance, an accounting trade group to which the company belongs. Plus, its turnover rate was 13%, below the 14.7% industry average. In a competitive field, both are advantages.

"Turnover in accounting firms is terrible for clients," says Katri, "and bad for business."

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