This chapter explores corporate philanthropy. From the higher education side, the process includes developing strategy, developing a case statement (i.e., a justification of needs and wants), research and prospect identification, communication and verification of interest, cultivating the friendship or relationship, making the ask, tracking and using resources, and thanking and recognition. From the corporate side, philanthropy may be bifurcated as altruistic and benevolent or as strategic and instrumental fulfilling societal expectations, town-and-gown functionality, or community goodwill. A range of motives exist for both the academy and businesses in these interorganizational relationships—typically economic, social, or environmental. Ethics plays a role in these dynamic interactions on the individual, organizational, and institutional levels.
The United States of America is the richest, most generous nation on Earth. In no other country do individuals, communities, foundations, corporations, and other private philanthropists give so many billions to such a wide variety of worthy causes and organizations. (Alexander et al., 1997, p. 13)
Companies, unlike foundations and other grantmaking organizations, do not exist to give. Their main responsibilities are to their employees, customers, shareholders, and the bottom line. (Grabois, 2010, p. xi)
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“Philanthropy has been an important part of American society since the 17th century” (Ricks & Williams, 2005, p. 148). However, business philanthropy has an escalating history, beginning with the great industrialists and catapulting in 1936 “when corporations first began reporting charitable contributions to the federal government under the provisions of the 1935 Tax Act” (Hall, 1989, pp. 239-240). Many corporate executives and managers believe corporate philanthropy (or also called corporate giving, giving, or just philanthropy) is “a well-respected tradition of returning or investing a share of a company’s profits into the community” (Mescon & Tilson, 1987, p. 49). An educated citizenry is foundational to a well-functioning community, and “corporations have a long and distinguished tradition of advancing the needs of higher education” (Elliott, 2006, p. 62). Examples of how corporations support higher education academic institutions through one-way actions include offering direct financial corporate charitable giving, which constitutes 13% of overall charitable giving (Wolley, 2019). Other types of one-way, potentially philanthropic efforts, include corporate foundation grants for programming, providing in-kind products or services, creating co-branding marketing in support of academic causes, employee volunteerism to events and programs, limited sponsorships, employee matching gifts (e.g., through alumni programming), discretionary funds for initiatives, and discounts on sales. In 2019, there were 2,888 corporate foundations with $36-billion in assets; they disbursed $7-billion in total to nonprofits, inclusive of higher education (Koob, 2020). “Stanford University received the highest number of grants. Seven of the top 10 grant recipients were elite universities” (Koob, 2020, p. 4).
Companies often address socioeconomic issues as well as education (Danko et al., 2008). Sharing profits with the community without expectation of return is the philosophical backbone of corporate responsibility; and “corporate philanthropy may be characterized as the ‘soul’ of a company, expressing the social and environmental priorities of its founders, executive management and employees, exclusive of any profit or direct benefit to the company” (Rangan, Chase, & Karim, 2012, p. 5). One of the social agendas is education. “Corporate giving and community involvement should be an expression of corporate responsibility driven by identity, special risks and opportunities the company faces in society” (Logan, 2016, p. 3). The academy is very important “with many corporations sponsoring grants and donations to higher education” (Danko, Goldberg, Goldberg, & Grant, 2008, p. 46). Contributions by businesses often include concerns of marketing, public relations, enlightened self-interest, tax strategy, and eliciting social currency (Galaskiewicz, 1989).
Education is not the sole recipient of corporate gifts, and large foundations are not the only donors. “Corporate philanthropy is now widespread in large multi-nationals as well as small- and medium-sized enterprises across the globe” (Gautier & Pache, 2015, p. 343). Small business—usually privately owned—philanthropy and volunteerism is usually very closely related to owner-managers’ personal values, network ties, and/or business ambitions (Clevenger, 2014; Lähdesmäki & Takala, 2012; Rangan et al., 2012). Sixty-percent of medium-sized companies focus on education (King, 2013). “As a company grows larger it may seek a more disciplined approach to its philanthropic activities, either through the creation of a formal foundation” or some external affairs office (Rangan et al., 2012). Hence, medium and large “companies handle philanthropic requests through their foundations or community relations departments” (Collins, 2005, p. 20). However, “the larger a corporation’s size and revenues, the greater the diversity of decision makers and the more fragmented its philanthropic activity may become” (Rangan et al., 2012, p. 6).