Share of Company Profits Given to Charity Drops From 2.4% to 1.1% in 11 Years

After seesawing for the past five decades, corporate contributions as a share of earnings have been on a downward trend, according to a new report.

The Conference Board, a New York research

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Growth in Corporate Contributions

group financed by businesses, examined corporate philanthropy since 1947, the year the organization began keeping track of companies’ gifts.

The report says that the recent drop in charitable gifts as a percentage of companies’ pre-tax earnings — from a high of 2.4 per cent in 1986 to 1.1. per cent in 1997 — is in part a result of corporate restructuring and the growing use of different types of contributions, such as non-cash gifts. In addition, the report notes, many philanthropic activities are difficult to quantify and may be reported as business expenses, not as charitable deductions.

Among other findings:

*While cash donations still dominate, non-cash gifts have gained popularity with companies, particularly since the 1980s. In 1997, the report notes, non-cash gifts accounted, on average, for 24 per cent of all corporate contributions.

*Corporate philanthropy has come nearly full circle in the last 50 years — starting out solely as a way to serve a company’s bottom line, moving to a less-commercial emphasis, and now once again being mostly business-driven.

*Education groups have consistently received the largest or near-largest share of all corporate gifts.

Copies of the report, “Corporate Contributions: The View from 50 Years,” can be obtained by contacting the Conference Board’s customer-service department at (212) 339-0345 or by orders@conference-board.org, and referring to publication No. 1249-99-RR. The report costs $45 for Conference Board members, $180 for non-members, and $20 for academics or other researchers.