Corporate Support for Public Affairs Nonprofits Corporate Philanthropy

Corporate Support for Public Affairs Nonprofits

Corporate Philanthropy: Some Basics • There was relatively little corporate philanthropy before the 1960 s. • Most large firms now make sizeable contributions to nonprofits. • Corporate contributions are mostly in cash, but some are in-kind. • Two channels of corporate giving to nonprofits: – Direct corporate giving – Corporate foundations

Motives of Corporate Philanthropy • Boosting sales and profits; coordinated with marketing and advertising • Enhancing conditions for long-term economic returns • Legitimation: presenting an image of social responsibility • Deterring and providing alternatives to government programs • Coopting and building bridges to potential adversaries • Reducing corporate taxes

The Scale of Corporate Philanthropy • Corporate foundations made grants of $4. 2 billion in 2006. • This constitutes 11% of all foundation grants. • Total corporate grants (including direct giving) were $13. 8 billion in 2005. • If direct giving was included with foundation giving, corporations would account for 29% of all foundation grants. • Corporations account for roughly 5% of all private philanthropic giving.

Recipients of Corporate Foundation Grants in 2005 • • • Education 25% Public affairs 22% Human services 19% Health 12% Arts and culture 11% International 4% Environment and wildlife 3% Science and technology 2% Other 1%

Motives of Corporate Support for Public Affairs Nonprofits • Corporate conservatism: funding pro-business, right-wing organizations • Corporate pragmatism: building bridges to liberal and moderate organizations

Who Gives the Most? 50 Largest Corporate Foundations (2005) • • Health and pharmaceuticals (N = 11) : $495 million Banking and finance (N = 11) : $444 million Insurance (N = 5) : $114 million Energy, oil, chemicals, mining (N = 7) : $244 million Motor vehicles (N = 4) : $169 million Retail, consumer non-durables (N = 6) : $292 million Telecommunications (N = 3) : $152 million Miscellaneous (N = 3) : $75 million

Who Receives the Most? The Capital Research Center Data • CRC was founded in 1984 to combat “liberal bias” in corporate philanthropy. • Published “Patterns of Corporate Philanthropy” periodically through 2001. • Rated corporations on the liberalism/conservatism of their public affairs grants. • Ranked public affairs nonprofits from 1 (“radical left”) to 8 (“market right”). • Weighted grants by ideology and dollar amount to give each corporation an overall score. • Publicized results to CEOs in effort to influence corporate giving. • CRC report for 2001: includes 90 corporations and 357 nonprofits for the year 1997.

Top 50 Public Affairs Nonprofits Receiving Grants from 90 Large Corporations (1997) Policy Planning and Advocacy ■■■■■■■ ■■■■■■ ■■■ ■■■■■■■■ ■■■■■■■■ ■■■■ 2. Council on Foreign Relations $2, 195, 050 4. Brookings Institution $1, 722, 000 5. Chamber of Commerce $1, 517, 029 11. American Enterprise Institute $965, 000 15. East-West Institute $793, 000 16. Center for Strategic & International Studies $760, 000 17. Economic Strategy Institute $575, 000 18. Committee for Economic Development $547, 500 20. Carter Center $480, 000 21. Ethics Resource Center $412, 500 30. Rand Corporation $360, 000 32. Heritage Foundation $341, 000 33. National Alliance of Business $331, 000 37. Citizens for a Sound Economy $317, 000 38. Institute for International Economics $317, 000 40. Aspen Institute $280, 000 44. Competitive Enterprise Institute $25, 5000 46. Joint Center for Political & Economic Studies $247, 000 48. Manhattan Institute For Policy Research $222, 000 50. Cato Institute $220, 000

Top 50 Public Affairs Nonprofits Receiving Grants from 90 Large Corporations (1997) Civil Rights ■■■ ■■■ ■■■ ■■ 1. Urban League $3, 917, 444 10. NAACP $1, 052, 650 22. Anti-Defamation League $406, 800 25. National Council of La Raza $392, 000 27. National Council of Negro Women $381, 667 42. League of United Latin American Citizens $260, 500 43. National Organization on Disability $260, 000 49. Mexican American Legal Defense & Education Fund $221, 500 Health and Human Services ■■■ ■■■■■■■■ 6. American Heart Association $1, 303, 985 12. American Cancer Society $943, 509 13. Families & Work Institute $850, 000 19. American Federation for Aging Research $519, 000 29. National Council on the Aging $363, 500 35. Children’s Health Fund $325, 000 36. Child Welfare League of America $320, 000 39. American Council on Science & Health $299, 000 47. Children’s Defense Fund $227, 500

Top 50 Public Affairs Nonprofits Receiving Grants from 90 Large Corporations (1997) Environment and Wildlife ■■■ ■■■■ ■■■ 7. Conservation International $1, 298, 500 8. Nature Conservancy $1, 285, 145 41. Resources for the Future $280, 000 41. Ducks Unlimited $262, 500 45. World Wildlife Fund $250, 260 Education ■■■■■■■■ 9. National Education Association $1, 243, 105 24. Public Education Network $394, 200 28. Education Commission of the States $378, 900 31. Students in Free Enterprise $350, 500 34. National Head Start Association $325, 705 Community Development ■■■■ ■■ 3. Enterprise Foundation $1, 940, 750 23. Points of Light Foundation $395, 000 26. Assoc. of Community Organizations for Reform Now International Development ■■■ 14. Accion International $846, 128 $385, 000

What Influences Corporate Giving to Public Affairs Nonprofits? • Hypotheses from research on corporate philanthropy: – Consumer goods industries contribute widely to promote image. – Corporations tend to concentrate grants in their local region. • Hypotheses from research on corporate PACs: – – Traditional regulated industries are more pragmatic/bipartisan. Defense contractors are more pragmatic/bipartisan. Regulatory violators exhibit more right-wing partisanship. Firms in South and Midwest exhibit more right-wing partisanship. • Hypotheses from research on policy board members: – Traditional regulated industries have closer links to moderates. – Sunbelt (South and West) firms have closer links to right-wing. • Hypotheses from research on corporate networks: – Firms with board interlocks exhibit similar political behavior.

Industry Differences in Corporate Giving Average CRC Rating (High = Right-Wing)

Regional Differences in Corporate Giving Average CRC Rating (High = Right-Wing)

Percentage Overlap in Nonprofits Supported by Dyads of Firms

Conclusions • Much corporate philanthropy is hidden, so any conclusions must be tentative. • Corporations contribute more heavily to public affairs than do other private foundations. • Corporations adopt a mixed strategy of conservatism and pragmatism. • Conservative grants are concentrated in the policy planning area. • Pragmatic (moderate/liberal) grants are concentrated in civil rights, health, and environment. • Variations in corporate giving follow a similar pattern to other forms of corporate political action. • More speculatively, corporate grants are of sufficient scale to have an impact on the program and politics of public affairs nonprofits. • Even more speculatively, relative to other funding sources, corporate grants are likely pull both left- and right-wing nonprofits toward the political center.

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