December 11, 2012; Source: Triple Pundit
The latest “Giving in Numbers” report from the Conference Board and the Committee Encouraging Corporate Philanthropy is based on a survey of 214 companies, including 62 of the top 100 companies in the Fortune 500. It looks at corporate giving in 2011, finding that cash and non-cash giving has increased in inflation-adjusted aggregate from $14.57 billion in 2010 to $15.72 billion but (there is almost always a but) cash gifts as a proportion of the whole have decreased from 69 percent to 64 percent. According to the study, the two industries dedicating the largest proportions of their overall giving to non-cash contributions are the health care industry (in which 47 percent of giving surveyed was non-cash) and the consumer discretionary spending industry (in which 40 percent of the giving surveyed was non-cash). Not surprisingly, 72 percent of all non-cash contributions are attributable to the pharmaceutical companies in the survey, largely through donations of medicine. On the flip side, the industries leaning heavily toward cash donations were the utility companies (distributing 98 percent of their total charitable contributions in either direct corporate or foundation cash) and the financial companies (with 97 percent cash contributions).
In case you are feeling left out of the corporate giving scene, know that there are many fewer grants given by corporations these days. There has been a 26 percent decline in the number of corporate grants in the past three years but, on the flip side, there has been a 31 percent increase in grant size over that period, with the median grant from corporations ringing in at a little over $30,000 in 2011. The report characterizes this as a more targeted and thoughtful approach. You also might be feeling left out if your nonprofit isn’t in K-12 education, which received 15 percent of corporate charitable dollars. Higher education received 11 percent, community and economic development snagged 12 percent, and social and health services enjoyed 28 percent of corporate donations.
For 2012, 13 percent of the companies surveyed that responded to this question (which was only 126 of them) predicted a decrease in giving, 40 percent predicted an increase, and 47 percent predicted a steady state. Overall, however, corporate philanthropy has been on an oddly downward trajectory. A quarter century ago, corporations were much more generous about diverting profits to philanthropy, reaching a high of 2.36 percent of corporate pre-tax profits. For 2011, the CECP puts the figure at just short of one percent, and in terms of cash, around two-thirds of one percent. The lower proportion of profits devoted to philanthropy contrasts with the increase in attention to corporate social responsibility in the past few decades. When actor Paul Newman joined with former Goldman Sachs co-chairman John C. Whitehead and New York City real estate developer Peter Malkin to create CECP, Newman’s idea was to boost corporate giving from one percent to two percent of pre-tax profits. Newman’s CECP colleagues talked him down from that position, but the latest CECP survey numbers, while highlighting some impressive corporate philanthropy, reveal corporate America falling short of even one percent of pre-tax profits as donations to nonprofits. –Ruth McCambridge