How The Chronicle’s Survey on Corporate Giving Was Conducted

The Chronicle’s survey of corporate giving offers a glimpse of the state of philanthropy at many of the nation´s largest businesses. It is based on information provided by some of America´s biggest companies, as ranked according to their annual revenue by Fortune magazine.

The 150 largest of the companies that make up the Fortune 500 were asked to provide

figures on their charitable giving for 1998, 1999, and 2000. Of those, 97 either filled out a Chronicle questionnaire or submitted financial information, such as annual reports.

While corporate foundations are legally required to make available their informational tax returns, businesses are not otherwise legally required to disclose any details about their philanthropic giving. The unwillingness of many companies to provide this information makes it difficult to get a complete picture of corporate giving at the nation’s top companies.

The 53 businesses that refused to provide information on their charitable activity offered a range of reasons for not participating.

Some said they were unable to pull together the data because they did not have a centrally administered giving program and it would be impossible to gather all the information from each of their business units. Others said company policy prohibits disclosing figures about their charity. Several companies said they no longer respond to surveys because they receive too many requests for data and don’t have time to fill them all out. Some simply declined to participate without explanation.

In addition, two companies that had recently been involved in mergers — Atlantic Richfield Corporation, which is now part of BP Amoco, and Warner-Lambert, which is now part of Pfizer — said that the giving figures requested by The Chronicle no longer were relevant or were impossible to retrieve. Both were on the Fortune 500 because the mergers were completed after the magazine’s list was published.

Companies were asked to include donations from the entire business, including subsidiaries, and for all gifts to charities in the United States and abroad. Five corporations — Abbott Laboratories, Caterpillar, Goodyear Tire & Rubber Company, Pfizer, and Sprint Corporation — said they either were unable to provide totals for some of their business units or could not calculate how much they gave overseas.

The companies were also asked to report their cash and non-cash gifts separately. Non-cash gifts were to include donations of company products only (excluding such items as surplus office furniture, for example) and were to be valued according to their fair-market price, not their production cost.

Some companies, especially retail supermarkets like Albertson’s and Safeway, included products that were not their own name brands. Others, including General Motors Corporation and the Minnesota Mining & Manufacturing Company, said they couldn’t break out the value of equipment and services from their product donations.

Companies were also asked not to include the value of employee volunteer programs in their donation totals.

Readers should be cautious about making comparisons between companies and from year to year. In some cases, a company’s philanthropy may appear to fluctuate when, in fact, an increase may be due to a company’s failure to spend its entire charity budget one year, so that dollars were carried forward to the following year. In other cases, a company’s giving may decrease because it made a big, multiple-year grant that it reports in its giving budget one year and not the next.

While observers of corporate giving typically measure a company’s generosity by comparing the business’s charity budget to its profits, the formula is often not so simple.

Some companies base their giving on a percentage of income subject to federal taxes, which is not necessarily the same as their pre-tax profits. Others have had wild fluctuations in profitability from year to year — sometimes due to business conditions and sometimes caused by the costs associated with mergers — while trying to keep charitable donations stable.

Comparisons between companies can be difficult, especially given the fact that some companies cannot calculate how much was given by divisions outside the national headquarters. Other corporations provided giving figures only for their foundations, saying they could not measure how much was given by the company itself. Still others do not keep track of products they donate.

Businesses also support charities through a variety of means other than tax-deductible gifts of cash and products. Some companies may offer low-interest loans, for example, or give employees paid leave to do volunteer work. Others may give money to non-profit groups through the companies’ marketing or research divisions, through deals that may help the company test a new product or gain the endorsement of a charity. Those deals are not counted in a company’s charity budget.

Following are the companies that declined to provide any financial information about their philanthropy to The Chronicle:

American Home Products Corporation (New York)
American International Group (New York)
AMR Corporation (Fort Worth, Tex.)
Archer Daniels Midland Company (Decatur, Ill.)
Associates First Capital Corporation (Irving, Tex. )
Atlantic Richfield Company (Los Angeles)
Banc One Corporation (Chicago)
Bergen Brunswig Corporation (Orange, Calif.)
Berkshire Hathaway (Omaha)
Cardinal Health (Dublin, Ohio)
Cisco Systems (San Jose, Calif.)
Columbia/HCA Healthcare Corporation (Nashville)
ConAgra (Omaha)
Costco Wholesale Corporation (Issaquah, Wash.)
CVS Corporation (Woonsocket, R.I.)
Dana Corporation (Toledo, Ohio)
Deere & Company (Moline, Ill.)
Dynegy (Houston)
Emerson Electric Company (St. Louis)
FedEx Corporation (Memphis )
Fleming Companies (Oklahoma City)
Halliburton Company (Dallas)
Hartford Financial Services Group (Hartford, Conn.)
Home Depot (Atlanta)
Honeywell Incorporated (Minneapolis)
IBP (Dakota City, Neb.)
Ingram Micro (Santa Ana, Calif.)
Johnson Controls (Milwaukee)
Kmart Corporation (Troy, Mich.)
Kroger Company (Cincinnati)
Lear Corporation (Southfield, Mich. )
Lehman Brothers Holdings (New York)
Liberty Mutual (Boston)
Loews Corporation (New York)
Lowe’s Companies (North Wilkesboro, N.C.)
McDonald’s Corporation (Oak Brook, Ill.)
Publix Super Markets (Lakeland, Fla.)
Rite Aid Corporation (Camp Hill, Pa.)
SYSCO Corporation (Houston)
Tech Data Corporation (Clearwater, Fla.)
TXU Corporation (Dallas)
Teachers Insurance and Annuity Association-College Retirement Equities Fund (New York)
Time Warner (New York)
Tosco Corporation (Linden, N.J.)
Toys “R” Us (Paramus, N.J.)
United American HealthCare Corporation (Detroit)
Viacom (New York)
Walgreen Company (Deerfield, Ill.)
Walt Disney Company (Burbank, Calif.)
Warner-Lambert Company (Morris Plains, N.J.)
Waste Management (Houston)
Wells Fargo and Company (San Francisco)
Winn-Dixie Stores (Jacksonville, Fla.)

The Chronicle’s survey was conducted under the direction of Harvy Lipman, with help from Debra E. Blum and Martha Voelz.