Development Crossing

Corporate Social Responsibility (CSR) and Sustainability

Fast Stats About Giving in America Today

givingThe annual Giving USA Foundation report has just been released, and the numbers tell an interesting story about corporate giving.  An alarming story, that is.

Here’s what you need to know:

  • Americans gave $335.17 billion to charity in 2013.  Which sounds good until you read the fine print and understand that we’re barely keeping up as a percentage of the GDP.

  • Charitable contributions in the U.S. grew 4.4 percent in 2013 but still haven’t rebounded to peak levels achieved before the economic recession.

  • Individuals donated $240.6 billion to charities, up 4 percent from 2012.

  • At 72% of all giving, individual giving represents the largest portion and fastest growing area of giving.

  • The increase in individual giving is leading the charge to create a fourth straight year of growth in total giving.  

  • Of four sources of giving that were assessed - individuals, foundations, bequests and corporations - every kind of giving rose in 2013 except for corporate giving.

  • Corporate giving fell by nearly 2 percent, to $17.9 billion.

The drop in corporate giving is troubling for all parties involved.  Nonprofits lean heavily on corporations for giving, and when numbers are down they must scramble for alternative sources of funding.  And companies are playing with their own bottom lines when they skimp on corporate philanthropy.  Now more than ever, employees are paying close attention to the philanthropic behavior of corporations and evaluating them accordingly.

As Greg Cantori, president and CEO of Maryland Nonprofits, observed to The Baltimore Sun, "It's distressing because companies have been hanging onto cash and not giving up their capital base. It doesn't make sense to me. They're not hiring unless they absolutely have to."

The good news is that companies are increasingly finding other ways to give back, especially in the form of volunteering.  And the dollar value of volunteering is significant.  In Maryland, for instance, the economic value of volunteering has been estimated at $25.43 an hour, according to Independent Sector, a national collection of nonprofits, foundations and corporations.  As a part of our total economy, that number adds up to hundreds of millions of dollars.

While volunteering has become a hot way of giving back, too many companies overlook in kind gifts, an excellent way for business leaders to give back by leveraging their corporate strengths and assets.  It can be an easy lift for companies, with the reward of a nice tax deduction accompanying the significant impact in one’s community or across the world (in the case of donating materials to assist with global disasters, for example).  Not to mention increased employee engagement, recruitment, retention and the plain ol’ good karma of responsible corporate citizenship.

As company leaders ramp up their volunteering programs, most do seem to understand the importance of workplace giving programs as well.  According to a recent survey by America’s Charities, companies increasingly recognize that corporate giving is no longer just about giving; it’s about creating fully integrated opportunities to engage employees.  The old way of doing things, where volunteering, giving, pro bono work and engagement were all separate buckets spread out over the company, is yesterday’s news.  Businesses now recognize that all of these practices fall within the same camp and need to function as a coordinated effort.

Over 80% of the surveyed companies agree that their company is committed to a giving program. They also agree that employee giving impacts their ability to attract and retain talent.  Fundraising and networking events are increasingly popular, with more than 50% companies having increased the number of giving events they offer.   Corporate matches are becoming more common, as businesses recognize that matching is a key tool to motivate employee giving through the workplace rather than individually.  Nearly two-thirds of employers surveyed indicate they match employee payroll contributions, a 58% increase since 2006.     

All of this is well and good.  So why are corporate numbers down when it comes to giving?  An integrated approach that combines volunteering and giving is certainly an effective way to engage employees and impact nonprofits, so the fact that more and more companies are charting this path is encouraging.  As I wrote about recently, most companies are harboring an army of employees who possess amazing potential that is going largely untapped.  Wasted impact is, in my view, a crime. CEO’s should do everything possible to keep the skills and passions of their employees within the walls of their company by deploying  them into the community for the greater good of all.     

But in their zeal for the new, CEOs shouldn’t forget the basics, either.  While old-fashioned checkbook philanthropy isn’t the only way that companies give back to nonprofits anymore, as it once was, company leaders must lead by example if they want employees to give back and put their own corporate dollars where their mouths are.

Get out your checkbooks, CEOs.

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Comment by Lani Botha on August 5, 2014 at 7:28am

Herewith an article we just wrote on the same issue from a South African perspective:

Religious devotion to giving higher among SA's wealthy

The recent Giving USA report reveals that Americans are more charitable than ever, boasting four consecutive years of growth in their charitable giving. Yet donations to religious organisations have continued to decline over the years, and support for religious organisations has fallen by 22% between 1987 and 2013.

Experts are divided about whether the blame should be placed on the fundraising capacities of religious organisations, their aversion to conventional fundraising strategies and tactics or the fact that Americans are becoming less and less devout. These funding constraints on religious organisations will naturally trickle down to social service organisations that are aligned to them.

In contrast, religious institutions and causes attracted more support from affluent South Africans in 2013. This is according to Nedbank Private Wealth's Giving Report II, which was published at the end of last year. More than a third of these high-net-worth individuals were motivated by religious beliefs to give and they tended to give slightly more than their peers.

Almost half of the respondents interviewed in the giving study gave support in the form of cash to religious institutions and affiliated causes, an increase of 10% from 2010. The sector received 20% of the estimated R8 billion donated in cash by wealthy individuals; this figure excludes tithes but includes general expenses for these organisations.

While giving by rich Americans tends to favour non-spiritual charities, with large sums of money often directed towards art galleries, universities and hospitals for medical research, religious contributions generally amount to around $100. South African high-net-worth individuals, on the other hand, give their charitable moneys towards more heartfelt causes, including care for orphans and vulnerable children, hospices and the elderly.

Religious establishments in South Africa continue to play a vital role in contributing toward making a positive difference in the lives of people who are less fortunate. Twenty years into our democracy, the role that philanthropy continues to play in curbing the social challenges of our people has become more than just a matter of giving, having evolved into a way of life.

Nedbank Private Wealth's dedicated Philanthropy Services Division provides services for donors and non-profit organisations (NPOs), enabling our donor clients to make the most of their giving and ensuring that NPOs work towards long-term financial sustainability.

Ends

For more information on philanthropy services offered at Nedbank Private Wealth contact Noxolo Hlongwane on +27 (0)11 295 8856.

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