Trends in corporate community involvement

June 01, 1994

CHARITABLE DONATIONS FALL

Charitable donations by corporate donors fell last year for the first time in ten years, according to figures published by Corporate Citizen magazine on May 23. The top 100 donors gave £105.6 million in 1992-3 – a drop of £2.4 million on the year before, the survey shows, and the magazine argues that this trend is set to continue: figures from latest annual reports show that BP, NatWest, Barclays and ICI have reduced their budgets for the second year running. BP, the top corporate donor in 1992-3, giving £9 million is down to £6.5 million and has been replaced at the top of the table by Barings, which has more than doubled its profits-linked donations to its charitable foundation to £8 million BAT Industries, Shell UK, British Gas and Lloyds Bank, however, have increased their donations, although the number of donations made has fallen as companies favour a selected number of adopted charities and streamline a number of ongoing projects. Corporate Citizen bases these findings on charitable donations only, not total community support including gifts-in-kind like staff time or facilities. Contact Alison Benjamin, Corporate Citizen, on 071 637 2905

DOING SOMETHING ABOUT IT

Less than half of large companies have a formal policy on charitable giving, according to new research published on April 13 by Ashridge Management College. Corporate Giving: Its Your Job To Do Something About It was sponsored by the charity Action Research. The survey, based on a postal survey of 2,000 companies including the UK’s top 1,000 businesses and a sample of small and medium-sized enterprises to which 348 responded also shows that:

the most popular charitable causes are “local charities”

the most popular form of support is the cash donation, used by 89% of respondent firms, followed by sponsorship, used by 62%

the least popular form of support is through a company trust fund

the most common benefits of corporate giving cited are improved company image, being seen as part of the local community, and improved staff relations and morale.

The study concluded that companies can be categorised into those that have a hands-off approach and those that adopt a partnership approach. (See Trends below for more details.) Contact Andrew Wilson, Ashridge Management College, on 0442 841174

SHELTER RESEARCH FINDINGS

Community goodwill is cited as the main benefit of charitable giving by 43% of companies, according to research carried out by Shelter, the National Campaign for homeless people. The survey, carried out in November 1993 and based on 200 telephone interviews with those responsible for making decisions about charitable donations, identified other benefits as:

opportunity to help community (30%)

improve relations with local community (30%)

PR/Press coverage (29%).

The research also showed that only 23% of community/corporate affairs departments work very closely with marketing departments on charitable donations, despite growing awareness of the importance of an ethical reputation. The majority of companies still do not measure the benefits of their donations. The survey revealed that:

31% did not try to assess the benefits

23% did so by press cuttings

18% relied on feedback from employees

14% received regular reports from charities

6% carried out corporate image monitoring.

Shelter has produced a corporate brochure, sponsored by Redland, to highlight successful partnerships. Contact Victoria Bowman, Shelter, on 071 253 0202

MORI RESEARCH

MORI will be conducting its fifth annual Corporate Responsibility Study in August. Run on a cost-shared basis, it will interview a cross-section of adults about their understanding and expectations of business responsibilities, including a comparison of individual companies. Last year’s study revealed increasing expectations of individual companies and major discrepancies between the expenditure of different companies and their relative reputations. Contact Stewart Lewis, MORI, on 071 928 5955

Comment

How alarmed should one get about figures showing a drop in charitable donations by the top 100 companies? Not very, is the right answer. Much more worrying would be a drop in total community contributions; after all the trend away from simple cash donations is well established. But that figure is harder to compile accurately, since little has yet been done to establish a standard method of recording and reporting – an old Community Affairs Briefing gripe!

Much more worrying, however, is the Ashridge data showing only 44% of large companies have a formal policy statement on charitable support. The Shelter research makes equally depressing reading, with nearly one in three companies not even trying to assess the benefits of support. Surely we should be applying standard business tools, like setting objectives then measuring performance, in this field as in any other. As a simple step forward, Community Affairs Briefing is happy to remind readers of MORI’s annual survey of corporate reputation, one good way to track success.

Corporate Citizenship Briefing, issue no: 16 – June, 1994

COMMENTS