Why is corporate philanthropy being left out?

Lucy de Las Casas

I find it striking how rarely corporate philanthropy is talked about within the wider funding community. In discussions about funders working together – whether this is collaboration, co-funding or knowledge-sharing – companies are hardly mentioned. Corporate philanthropy representatives are few and far between at funding events, and many are unaware of the available funding literature and resources.

In some ways this is not surprising. In my experience most people’s first response to working together is to find someone who ‘looks like me and thinks like me’. But in other areas traditional divides between groups of funders are being crossed: government is engaging with trusts and foundations; trusts and foundations are considering how they can work with philanthropists (see NPC’s report on this).

So why is corporate philanthropy being left out?

I suspect it’s because it is multi-faceted, going beyond giving financially to include giving time through employee volunteering and other in-kind giving. It often has multiple objectives – not only delivering charitable benefit, but also engaging employees, ensuring the business is seen as a good corporate citizen, even marketing and branding. My hunch is that this means other funders are suspicious of corporate philanthropy, unclear of its motives and not sure what to make of it.

These are valid reasons. Corporate giving is a complicated – even conflicted – area, starting as it does with a debate over whether companies should even give charitably or whether this is at odds with their duty to maximize value for shareholders. Most businesses now try to achieve business benefits alongside charitable impact through their giving – whether this is ensuring they are attractive employers, building goodwill among the local community, meeting customer expectations of good corporate behaviour, or positioning with respect to competitors.

As you see companies struggle to tick multiple boxes – juggling charitable impact with placing employee volunteers, finding marketing opportunities, fighting off senior execs who’d like to donate to their own or clients’ charitable interests – it becomes clear that business giving is very different from that of foundations or philanthropists.

But there are good reasons for greater engagement. At NPC we have seen the positives that come from good corporate philanthropy. One company that recently embarked on a local giving programme built genuinely supportive relationships with a number of grantees, who benefited from funding, facilities the company offered, and skilled advice on accounting and HR. Another company with a long-standing relationship with a grantee is providing funding to help bridge a gap left by a funding cut.

Trends in corporate giving are hard to discern because reporting is poor, but research by the Directory of Social Change suggests that over the last ten years there has been a gradual increase in community support and cash donations. And there is increased interest, with Culture Secretary Jeremy Hunt designating 2011 as ‘the year of corporate philanthropy’. At NPC we are seeing an increase in interest from companies wanting to start, or revisit, their giving.

There are certainly ways in which companies can improve their philanthropy. We frequently find attempts to hit too many objectives to be the enemy of good, impactful giving. Companies need to prioritize what they want to achieve and be certain of the charitable value. In-kind giving and volunteering is on the rise, and this needs careful management to ensure it is useful to the charity and does not cost them more than its value.

The wider funding community should also consider if there could be value in integrating companies rather than accepting their current separation. For instance, companies have a range of resources at their disposal that other funders do not, and frequently look for skilled volunteering opportunities for employees. Many foundations have a good understanding of the weaknesses and needs of their grantees. Perhaps foundations and businesses could work together to help match these, and provide charities with access to a pool of skilled resources, for example in IT, HR or property management.

On the other hand, businesses often struggle with committing to multi-year grants because of the unpredictability of their income where available funding is a percentage of the year’s profits. Trusts and foundations like match funding to make their funds go further. Perhaps there are opportunities for co-funding – the company commits to one year of funding and the foundation to a second. Or a foundation could underwrite the commitment to further funding should the company be unable to meet it.

It won’t be an easy win, but productive relationships can spring not from thinking ‘who is like me?’ but ‘who is unlike me?’

Lucy de Las Casas is Head of Consulting at NPC. Email LdeLasCasas@philanthropycapital.org


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