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Recession’s effects on corporate giving vary

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Corporate philanthropy

Corporate philanthropy

Total corporate giving for a subset of 110 American companies rebounded to $13 billion in 2010 from a trough of $10.36 billion in 2008, but about 45 percent of companies gave less during the recession, while half gave more, and 5 percent held steady, a new report says.

Cash contributions dipped during the recession, dropping to $4.21 billion in 2009 from $4.57 billion in 2007, says the 2011 edition of “Giving in Numbers,” a report from the Committee Encouraging Corporate Philanthropy that analyzes the charitable giving of 184 U.S. corporations, with 110 companies providing data for both 2007 and 2010.

But a spike in product donations, which jumped to $8.27 billion in 2010 from $5.9 billion in 2008, helped keep overall giving strong.

And while 61 percent of companies gave more cash in 2010 than in 2009, a reversal from the previous year, when 67 percent reduced their cash giving, not all companies have rebounded to their pre-recession levels of cash donation, the report says.

Some of the recovery in cash donations during 2010 was prompted by natural disasters, including the earthquake in Haiti, the report says.

Among companies that increased their cash giving in 2010, disaster response was cited by corporate-giving officers as the top reason for the increase.

Pharmaceutical companies, the perennial engine powering product donations, continued to push their Patient Assistance Programs, which provide medicine to under- or uninsured people, and helped drive in-kind contributions overall up 39 percent from 2007 to 2010.

Rather than spreading their donations far and wide, corporations now are awarding fewer but larger grants, focusing on one or two issue areas, the report says.

From 2009 to 2010, the number of companies devoting half or more of their total giving to one issue area rose to 33 percent from 24 percent.

Among issue areas, health and human services received the most corporate support, garnering 30 percent of total giving, while economic development and education each received 14 percent of total corporate contributions.

The report also outlines benchmarking data for several areas of corporate giving, including median giving by industry and company size, giving as a percentage of revenue and pre-tax profit, giving per employee, and giving by industry to various issue groups.

Among the 183 companies surveyed, median giving in 2010 was $22.1 million, which equated to 0.11 percent of revenue and 0.91 percent pre-tax profit.

Median giving for consumer-discretionary companies was 2.19 percent of pre-tax profits in 2010, more than any other industry group, followed by health-care companies, which donated 1.66 percent of pre-tax profits.

On average, 46 percent of donations were made in the form of cash from the corporation, 35 percent was in cash from the affiliated foundation and 19 percent was non-cash.

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