As Funds Shift Support to Emergency Needs, Long-Term Risks Loom

As the economic recession deepens, at least 33 of the nation’s biggest corporations have decided to do more to support food banks and other social services, according to The Chronicle’s annual survey of the 300 largest companies on the Fortune 500 list. While some people applaud the move, others are concerned about the repercussions of such efforts.

The GE Foundation has committed $20-million for food and shelter programs; Cisco Systems is offering to double its employees’ gifts to anti-hunger groups; and General Mills is working with a local United Way to plot a strategy for hunger relief in the Minneapolis area, where the company’s headquarters is located.

A General Mills meeting in March brought together 700 people from charities, local governments, and businesses, said Ellen Goldberg Luger, executive director of the company’s foundation, which also contributed $100,000 to a special fund the Greater Twin Cities United Way created to fight hunger.

“We’re a food company, and hunger has always been a strategic focus of ours,” she said. “And so we really looked at how we might do even more in the hunger space.”

Arts Giving Cut

But a change in focus can hurt other causes.

Caterpillar, for instance, is doing more this year to provide food, shelter, and clothing to poor Americans, but at the expense of arts and cultural groups, for which it plans to cut giving this year by nearly 70 percent.

Jennifer Zammuto, manager of the company’s foundation, said the grant maker has met with its grant recipients to explain the changes and may give more to the arts when the economy improves. “Lots of causes are good causes,” she said. “But when you’re limited on funds, you have to make decisions and prioritize a little more than perhaps you have in the past.”

Four other companies reported that they are trimming gifts for arts and culture to steer money toward food banks and similar groups.

Mark Shamley, head of the Association of Corporate Contributions Professionals, in Mt. Pleasant, S.C., said companies need to be careful and not “cannibalize” other programs in response to the recession.

“Are they forgoing their strategic commitments to respond to this crisis and, if so, what happens down the road?” he asked. “It’s important not to rush into the needs-based funding at this time.”

Noelle Barton and Candie Jones contributed to this article.