Foundations and corporates 'can work more closely together'

Corporate foundations can work closely with their founder businesses without compromising their independence, according to research for the Charities Aid Foundation.

The Changing Nature of Corporate Responsibility, compiled by corporate responsibility consultancy the Smart Company, found that there can be a greater social impact and business benefit by sharing resources between companies and foundations, despite previous evidence that many corporate foundations are in practice controlled by their parent company.

Research by the Smart Company last year for the Cabinet Office and the CAF found that 10 out of 29 foundations admitted they were either completely or nearly completely controlled by the companies that established them, despite the legal requirement for corporate foundations to be independent (Third Sector, 11 October 2006).

The new report says that corporates can improve the way they engage with communities by listening to the experiences of their associated foundations, which are generally closer to the communities they support. In return, it says, foundations can benefit from guidance from their parent companies to develop better reporting practices.

It also says the key challenge for foundations is to improve communication to their parent company and to stakeholders outside the organisation of their purposes, objectives and activities.

“It is particularly interesting to note how some companies are using the foundation model, and making the most of the benefits that come with that model, to manage a core part of their strategic CR programme,” said Russell Prior, executive director of company services at CAF.

The report highlights the case of supermarket Waitrose, which worked with its foundation to address both social issues and their corporate responsibility obligations. The Waitrose Foundation helped improve the welfare of farm workers in South Africa, which produced fruit sold in the stores.

Nick Monger-Godfrey, head of CSR at Waitrose, said: “By combining the efforts of the Waitrose Foundation with our main corporate responsibility programme, we are able to provide more investment for social welfare programmes to improve the lives of farm workers and their families”.

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