CECP FINDING: In the CECP sample, aggregate total corporate giving actually rose by 7%, largely driven by increased contributions of medicine by pharmaceutical companies and large corporate mergers and acquisitions that resulted in combined giving budgets exceeding historical levels. Thus, while The Chronicle does not explicitly attribute the drop to any one donor group, the CECP findings suggest that this decline in aggregate funding for the nation’s largest charities might be attributable to non-corporate donors. Giving USA, a comprehensive reference reporting on all sources of American philanthropy, also found in 2009, that corporate giving rose an estimated 5.5% (5.9% adjusting for inflation), but that individual giving in fact fell by an estimated 0.4% (flat if adjusting for inflation) and charitable bequests fell by an estimated 23.9% (-23.6% adjusting for inflation).
It is important to note that even though aggregate total giving rose in the CECP matched set of companies, the majority of companies actually reduced giving in 2009. This may have contributed to The Chronicle’s finding that median total funds raised at these charities also declined.
CHRONICLE TAKEAWAY: Charities that received donations of food, clothing, medicine and other product contributions reported the greatest expansion over the past two decades.
CECP FINDING: This takeaway introduces two main findings. First, reinforcing The Chronicle’s analysis, the corporate giving trends also reflect an increased emphasis on programs serving basic needs. Among reasons for increased giving, companies reported above-budget giving that was approved to support programs serving basic needs, such as health and community development. In fact, the only program areas to receive increased aggregate cash contributions in 2009 were Health & Human Services, and Community & Economic Development.
The second part of this finding is that non-cash contributions helped drive nonprofit expansion over the past two decades. In the CECP sample, non-cash contributions increased in aggregate by 16% from 2008 to 2009. Pharmaceutical companies, in particular, provided increased non-cash donations by revising their existing or creating new Patient Assistance Programs to provide medicine to the unemployed and uninsured. However, the level of corporate non-cash donations, whether product, use of facility/space, or pro bono service, are dependent each year on variable factors: the amount of product available, one-time donations of land or product, changes in pro bono service program offerings, and disaster relief efforts that arise. While non-cash contributions can be incredibly helpful to charitable organizations, these donations are ultimately only as valuable as they are used – the nonprofit organization has to have both the need for and the capacity to utilize the donation.
CHRONICLE TAKEAWAY: The value of a cash grant is as critical as ever.
CECP FINDING: In an economic downturn, cash resources are in high demand, but often in short supply. Almost two-thirds of companies in the CECP sample reduced their cash contributions, citing mandated company-wide spending decreases, declines in foundation endowments, and reduced transfers from the company to the foundation. As emphasized in The Chronicle's findings, the reduction in cash contributions is challenging for nonprofit partners who depend on such funding to maintain operations and programs. As one effort to prevent reductions in cash contributions, the corporate findings show that 53% of companies reduced their management and program costs. Also, the number of companies offering paid-release employee volunteer programs increased, thereby allowing more employees to volunteer during a normal, paid work-day and provide increased operational or hands-on support to nonprofit partners.
CHRONICLE TAKEAWAY: Nonprofits anticipate an increase of 1.4% in 2010 funding.
CECP FINDING: In The Chronicle study, nonprofits predicted the level of funds raised will increase by a median of 1.4% in 2010, and rise by approximately 2-3% in 2011. CECP does not have a direct comparison to this figure, as the CECP survey asked respondents to identify what range of change they expected in their total giving levels for 2010. After removing those respondents who were unable to estimate changes in total giving at the time of the survey in April, CECP found that 44% of companies expected increases, 45% expected no change, and 11% expected reductions (N=106). Of those expecting increases, 45% expected to expand by 10% or more, and of those expecting decreases, only 18% expected reductions of 10% or more. CECP looks forward to offering the industry’s first-look at 2010 corporate giving levels in June 2011.
CHRONICLE TAKEAWAY: Nonprofits responding to narrower focus from donors.
CECP FINDING: To make a greater impact, an increasing number of companies appear to be focusing their giving on one or two issue areas. As noted in The Chronicle, many nonprofits are carefully watching these shifts and considering donor priorities when planning a new campaign or re-envisioning their mission. One example of this, as cited by The Chronicle, is how the Boy Scouts of America, which had previously tasked local chapters with fundraising efforts, decided to make some of these efforts national in scope and consequently, raised funds for a large-scale, high-visibility outdoor center for youth. These adjustments helped attract several large corporate funders who identified with the project’s goals, the scope/scale, and the impact.
Thus, while corporations are only one of the donors in The Chronicle study, many of the key findings are reinforced by trends in corporate giving. As the economic recovery continues, there is tremendous potential for renewed and innovative engagement on social issues - hopefully, strengthened, informed, and reinvigorated by the choices companies and nonprofits have had to make over the past two years.