18 December, 2017 New Trends: A Look At Corporate Philanthropy Today
he new trends in corporate philanthropy include businesses boosting funding within their focus sector, and placing massive importance on measuring their impact.
Corporate Philanthropy has been getting a lot of attention in recent years, as more and more companies and businesses focus on making a positive social impact, through donating of finances, employee time, or their own offerings. But what began as a kind of tick-box approach to guiltily giving money into under-developed sectors, usually within their own community, has grown into a much more thought-out business decision – with corporations even overtaking the results of private foundations.
“A new kind of philanthropy is moving front and center in the corporate world: Proactive giving that’s closely aligned with the mission and assets of companies, and quite strategic,” says David Callahan on Inside Philanthropy. According to a report by Corporate Citizenship, “nearly three quarters of corporate foundations surveyed across 20 countries said that their giving strategy is linked to the parent company’s business focus, a big jump up from 58 percent in 2013.” Businesses are able to better fuse together traditional fundraising skills with stronger business approaches, to achieve a more holistic and successful result.
There’s also the trend of corporations focusing on helping within their own sectors, in a way that will boost their productivity – and profit – in the long run. Globally, tech companies, for example, will boost funds in STEM education, “as they look to the future supply of skilled workers for their sectors” says Callahan. Other examples include big banks, which need workers from diverse urban areas, “investing millions in grant-making to boost basic jobs skills and career readiness” or health providers boosting public health, which helps the community – and lowers their costs.
Supporting knowledge for the future workforce is also a trend in South Africa, where CSI expenditure was estimated to be worth R8.6 billion in 2016‚ significantly up from R2.9 billion in 2006‚ according to research presented by Cathy Duff, a director at Trialogue consultancy, who spoke at the 10th annual Business in Society Conference that took place in Johannesburg in May 2017. The conference showed that education was still the biggest winner in CSI spend in South Africa, with more than 90% of companies supporting the sector in 2016.
The Corporate Citizen report also touched on a few other interesting new trends within corporate philanthropy. For one, it showed that corporate funders were becoming more focused on fewer issue areas, which truly helps to drive sustainable impact. It also found that funders are more keen to measure their impact – in order to assess their level of success. “Half of the corporate funders surveyed said they measure their impact already, and three-quarters said they would like to,” says Callahan.
This is a trend we are seeing more locally too – as corporations want to know about the extended impact of their generosity. Philanthropic Events such as The CEO SleepOut™, have partnered with analytics companies, in order to measure and report back on this impact. IQ Business, for example, produces the Social Return on Investment report for The CEO SleepOut™, which tells the story of how change is created and evaluates the impact of The Event. This includes the monetary donations, the value of the items collected, the value of items donated after the event, and the increase in empathy experienced by participants, which affects their business policy going forward. In 2016, the cost to benefit ratio was R1: R4.24. Meaning for every R1 that was invested in The Event, a social return of R4.24 was created. Reports like this make donors feel more secure – and aid in collecting funds in the future.
What does this mean for fundraising today? Well, if non-profits want a piece of the corporate philanthropy pie, they need to approach big business with a plan that proves it aligns with the company’s overall business objectives – and ensure they can report back to the business once its funding has been spent. The lines between business and non-profits are blurring, and non-profits are the ones who will need to improve their skills to keep up.
– By The Philanthropic Collection –
The Philanthropic Collection™ is a boutique social enterprise,
where we tailor haute-couture brands for philanthropy.