Overseas Giving by American Companies Is on the Rise

Companies are channeling a growing share of their donations outside the United States, according to a Chronicle of Philanthropy survey of giving by the largest American businesses. That trend is expected to accelerate as corporations open new offices and sell more products in foreign countries.

Last year, 41 companies in the Chronicle survey gave $2.5-billion in cash and products abroad, compared with $2-billion in 2006. The median gift was $8.3-million, meaning that half the gifts were larger and half were smaller. In 2006, that figure was $6.7-million.

Six businesses increased their international giving by at least 100 percent, while four distributed more than $100-million in foreign countries.

The Chronicle survey was based on data from 85 of the 150 biggest American companies, as ranked by Fortune magazine according to revenue. The survey did not ask companies to provide information about what portion of their overseas giving was cash, so these figures reflect a combination of cash and product donations.

People who work with corporate executives said international giving would continue to increase, particularly in emerging markets.

“Many of these companies are growing substantially outside the United States,” said Johanna Schneider, executive director of external relations at the Business Roundtable, in Washington. “They are being very strategic about their philanthropy and they want to support communities in which they’re growing and thriving.”

But that jump isn’t expected to come at the expense of support for domestic nonprofit groups.

“It’s not a zero-sum game,” said Susan Raymond, executive vice president of Changing Our World, a New York firm that provides advice on philanthropy and fund raising to nonprofit groups. Companies are expanding their operations and, consequently, their giving overseas even as they continue their business and philanthropic programs in the United States, she said.

Cutting Across Borders

The growth in international giving last year came even without a major international disaster to spur donations. It also came despite a number of hurdles, including increased government regulations on charitable giving abroad after the 2001 terrorist attacks and the difficulty of finding foreign charities with which to work, said Charles H. Moore, executive director of the Committee Encouraging Corporate Philanthropy, in New York.

Some companies have sought to copy the successes of American programs overseas or create programs that operate similarly in multiple countries. Cisco Systems, a San Jose, Calif., technology company that gave a total of $93.6-million last year, recently committed $45-million to rebuild earthquake-devastated schools and health-care facilities in China. That effort will draw on lessons from the company’s work helping schools in the Gulf Coast after Hurricanes Katrina and Rita.

Last fall, Merrill Lynch, in New York, pledged $5-million to the Sesame Workshop for a program that educates children in 175 countries about the rest of the world. The financial-management company also gives to Model United Nations programs around the globe.

“When we design a program, we design it so it can cut across borders,” said Eddy Bayardelle, president of the Merrill Lynch Foundation, which awarded a total of $43.7-million in 2007. “If we have a program that works in Los Angeles, we want it to work in New York City, in Kansas, in Beijing, in Spain, or in Sao Paolo.”

Many businesses are increasing local control over their international giving. Last year, Microsoft developed partnerships with nonprofit groups in 19 countries to help the technology company do a better job of delivering donations of software and other products.

“It had been a very U.S.-centric program and one of the things we’ve done over the last year is to make it more of a global program,” said Akhtar Badshah, senior director of community relations with the Seattle corporation.

Despite the growth in international giving, most companies still contribute a much-smaller percentage of their revenue abroad than they generate from consumers overseas, said Mr. Moore.

He estimated that the largest U.S. companies are giving about 13 percent of their donations abroad but may make more than 25 percent of their revenue overseas.

But most corporations said they would continue to base their giving on local communities’ needs and their business’s interests, and not tie it directly to where they generate their profits.

“We look at the opportunities available to help people in the region,” said Michael Yutrzenka, executive director of the Cisco Foundation.