Corporate Philanthropy

What is Corporate Philanthropy?

Corporate philanthropy refers to company initiatives designed to contribute positively to social causes and support charitable activities. These initiatives may include financial donations, volunteer efforts, in-kind contributions, and other forms of support aimed at improving communities and addressing societal challenges.  

Essentially, corporate philanthropy embodies a company’s commitment to giving back and making a positive impact beyond its core business operations. 

This article explores the different types of corporate philanthropy, along with the benefits of each. We’ll also cover how corporate philanthropy compares to other related concepts such as corporate social responsibility (CSR) and workplace giving to offer a comprehensive overview of the ways companies can choose to give back to both local and global communities. 

Benefits of Corporate Philanthropy

In addition to the benefits that come from contributing to a worthy cause, corporate philanthropy also offers businesses several different advantages, including: 

Attracting & Retaining Talent

Engaging in corporate philanthropy can offer companies a competitive edge in recruiting top talent, who may prefer to align with employers interested in making a difference.  

Volunteer opportunities and involvement in projects that give back can also improve job satisfaction and foster team spirit. A survey from the software company Benevity showed that surveyed companies with employees engaged in workplace giving and volunteering reduced turnover by an average of 57%. 

Improved Reputation 

Companies known for their philanthropic efforts often enjoy a more positive public image. A commitment to philanthropy can also increase trust and loyalty with consumers and stakeholders who align with the company’s values.  

Networking & Partnership Opportunities

Philanthropic activities can open doors to new business relationships and partnerships with other socially responsible organizations, creating platforms for collaboration and shared initiatives. 

Potential Tax Benefits

Companies may receive tax deductions for their charitable contributions, providing a financial incentive to engage in corporate philanthropy. 

Types of Corporate Philanthropy

Corporate philanthropy can take several forms, each with its own unique benefits and opportunities for companies and employees, including: 

Financial Donations

A business may simply choose to financially support a cause or a specific non-profit. For example, companies such as Patagonia, OXO, and Klean Kanteen are all part of the 1% for the Planet network, in which businesses commit to donating at least 1% of annual sales to environmental organizations. 

Cause-Related Marketing

Cause-related marketing involves partnering with a non-profit organization to promote a social cause alongside a company’s products or services. This approach raises awareness for the cause while offering the company the full range of benefits of corporate philanthropy.  

Walgreens’ partnership with Red Nose Day, an organization dedicated to ending the cycle of poverty for children, offers one highly visible example of cause-related marketing.  

Matching Gifts

Matching gift programs encourage employees to donate to charitable organizations by matching their contributions, often dollar for dollar. This approach amplifies the impact of employee donations and demonstrates the company’s support for their employees’ philanthropic efforts. 

Matching gift programs amplify the impact of employee donations and demonstrate a company’s support of their employees’ philanthropic efforts. 

Volunteer Time Off Programs

Volunteer Time Off (VTO) programs allow employees to take paid time off to volunteer for charitable causes, making it easier for employees to find time to work on the causes that matter to them. 

Corporate Sponsorships

Corporate sponsorship involves providing financial support for philanthropic events, activities, or organizations. This type of corporate philanthropy helps increase brand visibility while demonstrating a company’s commitment to community involvement. 

In-Kind Donations

In-kind donations involve giving products or services instead of money. This can include donating goods to those in need or providing pro-bono services to non-profit organizations.  

TOMS’ One for One^® model, in which the company gave away a pair of shoes for every pair sold, is one example of an in-kind donation, as is Warby Parker’s Buy a Pair, Give a Pair program.  

Other Types of Corporate Philanthropy

Companies also have several other options for corporate philanthropy. These include volunteer grants based on employees’ volunteer hours, direct corporate grants to nonprofits, employee grant stipends for charitable donations to the organization of the employee’s choice, corporate volunteer programs, scholarships for students, and annual giving drives.  

Companies committed to corporate philanthropy may choose to adopt several of these initiatives to amplify their impact.  

How Does Corporate Philanthropy Compare to Corporate Social Responsibility (CSR)?

Corporate philanthropy and Corporate Social Responsibility—or CSR—are closely related but distinct concepts. Corporate philanthropy focuses on direct charitable actions and contributions. CSR encompasses a broader range of practices aimed at ensuring a company operates in an ethical and socially responsible manner. CSR initiatives often include sustainability efforts, ethical labor practices, and community engagement programs, of which corporate philanthropy can play a part. 

How Does Corporate Philanthropy Compare to Corporate Giving?

Although they sound similar, there are subtle differences between these two concepts:  

• Corporate philanthropy refers to any charitable donations or activities undertaken by a company.  

• In contrast, corporate giving (sometimes referred to as workplace giving) typically refers to structured programs that originate with employee action. For example, a matching gift program would be considered workplace giving, since it requires the employee to take action for the gift to take place.  

The Current State of Corporate Philanthropy

The corporate philanthropy landscape is continuously evolving, and it can be challenging to measure.  

Several data points suggest that corporate philanthropy is on the rise. In 2023, a study from Giving USA reported that corporate giving increased 3.0% to $36.55 billion. Research from Fidelity Investments and the Association of Corporate Citizenship Professionals (ACCP) showed that 40% of organizations surveyed increased funding for workplace giving programs in the previous two years, while 36% maintained their funding levels. Only 4% indicated a decrease.  

Other recent trends in corporate philanthropy include:  

• A growing emphasis on strategic philanthropy, where companies align their charitable efforts with their core business goals and values.  

• A rising focus on measuring the impact of philanthropic activities to ensure they deliver meaningful and sustainable outcomes. 

• A movement toward greater transparency and accountability in philanthropic activities, with businesses seeking to quantify the tangible benefits of their contributions. 

Embracing the Benefits of Corporate Philanthropy

Corporate philanthropy comes with the dual benefit of contributing to positive social and environmental change, while benefiting the business behind the initiatives. By embracing corporate philanthropy initiatives, companies can bolster their efforts to recruit top talent, foster employee engagement, enhance their public image, and build stronger connections in their surrounding community.  

TIGER 21 provides ultra-high-net-worth entrepreneurs, investors, and executives with a personal board of directors for candid discussions around topics that include wealth creation and preservation, family, legacy, and philanthropy.  

If you’re interested in discussing philanthropic initiatives like these with a set of like-minded peers, we invite you to learn more about the TIGER 21 global network. Members also enjoy access to private online networks, including the Philanthropy Network, where Members around the globe connect on impact strategies. 

Learn more about TIGER 21 Membership.