By Ret Boney
Corporate contributions to charity jumped 14 percent last year and grants from corporate foundations reached a new high, two new studies say.
Total giving by 91 corporations surveyed reached $10 billion for the first time in 2005, says a new study by the Committee to Encourage Corporate Philanthropy.
A separate study by the Foundation Center in New York says the nation’s 2,600 corporate foundations combined gave a record $3.6 billion last year, up almost 6 percent from 2004.
Giving by a subset of 62 companies, which provided data to the Committee to Encourage Corporate Philanthropy both in 2004 and 2005, totaled $8.4 billion last year, up 14 percent from $7.4 billion the previous year, the study says.
“Corporations are inextricably linked to society and its well-being,” says Margaret Coady, director the group’s corporate giving standard program. “They take seriously their license to operate and how it’s dependent on the health and success of the communities in which they operate.”
The survey, “Corporate Giving Standard,” says the growth in giving occurred during a year that saw a 17 percent jump in revenue and 15 percent growth in pre-tax profits.
The natural disasters of 2005, including the Gulf Coast hurricanes and the earthquake in Pakistan, may have spurred corporate giving, says Coady, but improvements in tracking donations also may have contributed to the reported increase.
Median total giving for the 62 companies reporting in 2004 and 2005 grew to $38.2 million from $33.4 million, the study says, and giving per employee grew to $685 from $670 during a time when the median number of employees grew 9 percent.
The median contribution by survey respondents to hurricane relief efforts in 2005 was $2.1 million, more than double donations to tsunami relief the previous year, the study says, with total hurricane donations exceeding $300 million last year for the companies responding to the survey.
The Foundation Center study, “Key Facts on Corporate Foundations,” says that while their overall giving grew, the corporate funders’ share of overall foundation giving has dropped from 17 percent in 1987 to 11 percent in 2005.
Despite that drop, which occurred during a time when foundation giving in general grew significantly, corporate giving overall and corporate foundation giving still represent a critical component of private charitable support, says Steven Lawrence, director of research for the Foundation Center.
More than half the corporate foundations surveyed say they expect to increase their giving this year, the study says, while about one in three say donations are likely to fall.
Over the past two decades, an era that saw corporate consolidation, Lawrence says, the number of corporate foundations has doubled.
“By establishing foundations, corporations are sending a signal that they are committed to philanthropy over the long term,” he says. “They are establishing an entity to conduct philanthropy on their behalf.”
The Midwest is home to the largest share of corporate foundations, about one in three, with the Northeast a close second, followed by the South and West, the report says.
About one in four corporate foundation dollars went to support education, about the same amount funded public affairs/society benefit efforts, and slightly less that one in five dollars benefited human services.
The Wal-Mart Foundation gave $154.5 million in 2004, more than any other corporate foundation, followed by Aventis Pharmaceuticals Health Care Foundation, which gave $114.7 million and the Ford Motor Company Fund, which gave $77.9 million.
The Foundation Center has developed a new searchable, online database that includes information on all U.S. corporate foundations and some corporate giving programs, says Lawrence.
The tool, called Corporate Giving Online, is updated weekly and is intended to help nonprofits identify sources of corporate funding.