Cash donations from major companies to UK charities have fallen in recent years, as companies opt for in-kind donation instead, according to a new report.
Overall corporate donations to UK charities are valued at £1.6bn per year which is less than 5 per cent of charities’ total income.
UK citizenship in the 21st century, which was produced by Cass Business School and the Directory of Social Change pulls together data from various sources to give an overview of the current trends in corporate giving.
Professor Cathy Pharoah, co-director of the ESRC Centre for Charitable Giving and Philanthropy at Cass Business School, who co-authored the report, said: “While individual companies are involved in imaginative partnerships with voluntary organisations, or have increased their giving, overall the corporate sector could make a much more robust contribution to building stronger communities.”
Figures compiled by the Directory of Social Change claim that in 2008/09 - the latest year for which such figures are available - corporate donations to UK charities fell by 4.3 per cent in real terms.
The report argues that: “At a time of financial crisis, when UK charities and community groups need more resources a reduction like this is a significant issue.”
Dr Catherine Walker, head of sector trends, evidence analysis and metrics at the Directory of Social Change, who co-authored the report, described the falling levels of cash donations as “disappointing”.
She called on companies to do more, saying: “It is not enough to talk about corporate social responsibility. Charities and voluntary sector organisations need to see a new commitment from the UK business community to give more, and to match sentiments with hard numbers.”
Trend in international giving
The report highlights that where giving to UK charities fell, the amount given to communities around the world increased. In 2009/10 the top 300 companies listed on the UK stock market gave £2.6bn to support worldwide development.
Between 2007/08 and 2008/9 the giving to international causes grew by 11.6 per cent, however this drops to 1.4 per cent if product donations are excluded from the figure.
The report says that product donations, particularly from large pharmaceutical and healthcare companies, can go some way to explaining the disparity between UK giving and international giving. However, other factors such as the financial crisis and the merger of UK banks also played a part.
Problems reporting
The report says getting accurate and reliable data on corporate giving is difficult because there are few legal obligations.
Additionally it is difficult to put a monetary value on volunteering or mentoring. Some companies also include employee fundraising and payroll giving in their CSR reporting which it could be argued are not strictly a corporate donation.
It concludes: “It seems self evident that better reporting, transparency and standardization of measurement is crucial, and that policies towards corporate citizenship should be up to date and crystal clear to provide a better picture of what support there is, where to find it and for what purposes it is available.”
