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Study: Women Inspire Corporate Philanthropy
Source: CBS -  ·  July 22, 2011  ·  Excerpt

Is corporate philanthropy a good use of shareholder money, or is it simply a perk given to senior people in the company? And what influences how much a company gives to charitable causes? A new paper from Christopher Marquis and Matthew Lee of Harvard Business School provides some insights.

Corporate philanthropy, as high-flying as it may sound, has been the subject of controversy at least since the 1970s. The most basic charge is simply that corporate giving is a waste of shareholder money. If corporations have ‘extra’ money lying around, the theory goes, that money should be reinvested in the business or paid out as dividends to shareholders. Another objection is that corporate philanthropy is merely a perk given to senior execs, who can then fund their pet causes on shareholder’ dimes.

Marquis and Lee conducted a study of Fortune 500 companies to see which factors influence the generosity of corporate giving. Their findings:

  • Companies with newer CEOs tend to give more
  • Companies with more female senior managers give more money to charity
  • Companies with more female board members give more money
  • A bigger board equals more corporate giving
  • As the size of the corporate foundations increase, board members have less influence over corporate giving
  • Companies whose headquarters are located in lower-income areas give more

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Our take
The importance of demographics in managing an effective nonprofit organization cannot be overstated: you simply must know your audience (corporate or otherwise) if you are to build relationships, collect data, and ultimately act upon the research that you've done. And while there are several findings from the study above, a pivotal one may be the influence that women are having on corporate giving as they establish a stronger presence in upper management and on boards.

Contact Compass Pointe today for help answering these and other questions:

  • How can my organization collect data on the businesses and corporations we target for donations, and more importantly, how do we act on that data?
  • What other demographic trends are emerging in corporate giving and how can my organization capitalize on them in a meaningful way?


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