How Does Philanthropy Pay?

How Does Philanthropy Pay?

Companies in retail and financial services saw increases of $6 in sales for every $1 donated through corporate charity. 
Lauren Turner October 31, 2013

How Does My Company Benefit From Corporate Giving?

1. Consumer satisfaction is key to the success of corporate donations.

A study of 251 firms on the Taft Corporate Giving Directory showed those in consumer-focused industries performed best financially following their donations.

2. Donate to maintain competitive edge in a dynamic or unstable industry.

In a study of 817 companies on the Taft Corporate Giving Directory, firms in dynamic environments who donated benefited most financially due to greater stakeholder support.

3. Give generously, or not at all.

A study of 1, 214 firms showed the relationship between financial and social performance is U-shaped: firms that either gave nothing or gave generously had higher net income and ROA than those in the middle.

4. Don’t dabble in corporate philanthropy.

In a study of 537 large UK firms, those who performed the worst financially had average levels of corporate giving.

5. Know How Much is Too Much.

Data from Taft Corporate Giving Directories showed donations stopped “paying off” past a certain point: eventually direct costs of philanthropy outweighed financial return.

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