Editorial: Company giving needs a new lease of life

The latest figures show corporate contributions have stalled would benefit from greater transparency, writes Stephen Cook

Stephen Cook
Stephen Cook

There are many companies that contribute generously to charities and their local communities, not least because they understand how doing so can improve their reputation and therefore their commercial success. Third Sector highlights what they do in our fortnightly Business Partner column and our annual Business Charity Awards.

The Company Giving Almanac 2013, recently published by the Directory of Social Change, confirms that a handful of companies are very generous, with the financial services, utilities and consumer services industries contributing about 0.7 per cent of their pre-tax profits. But this is well short of the 1 per cent contribution regarded as the gold standard, and the almanac says that other industries give as little as 0.1 per cent of profits.

Overall, it estimates that company giving now totals between £700m and £800m - about 2 per cent of the voluntary sector's income - and has not increased meaningfully in a decade. "Corporate philanthropy is far from dead, but it may need a new lease of life after the recent economic difficulties," it concludes. That's a tactful way of putting it.

The most forceful recommendations concern transparency: too many companies inflate their giving figures by including overheads, unmatched payroll giving and donations by customers. The almanac also urges companies to engage properly with charity partners and beneficiaries about what they really need from the relationship, which might not be having the same wall painted again by the same team of highly qualified accountants. And it warns against "charity-washing", reminding the sector to avoid being used as a kind of "PR detergent" to remove the stains on a company's reputation: charities should be more demanding in their relationships with corporates, it says.

The inescapable message is that companies could and should increase their contribution, and the government's new consultation on corporate social responsibility should help. Meanwhile, The Company Giving Almanac should be required reading in company boardrooms and CSR departments.

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