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mark butcher associates
sustainability | skills | strategy

The past, present and future of corporate philanthropy

Category: Fundraising

Background

Business investment in the community is not a new phenomenon. In the nineteenth century William Hesketh Lever raised money for a lifeboat - ‘Sunlight No. 1’. This was gifted to the RNLI after the money to pay for it was raised as part of a Sunlight Soap competition in 1887. Leaders from the fields of commerce and industry, such as the Cadbury and Rowntree families also pioneered business giving. In the USA Andrew Carnegie set about giving away his vast fortune to endow civic buildings, libraries and museums. Even then there was a mix of motivation. As Tony Elischer tells us in ‘Corporate Fundraising’ (CAF/ICFM - Ed Valerie Morton) ‘Even in these early times, the motivation behind company support was complex and sophisticated, ranging from the purely philanthropic, through ambitious desire for self promotion and social aggrandisement, to recognition of mutually commercial self interest.” This range of motivation still exists today. Indeed it, and the techniques employed to achieve it have increased in sophistication, breadth and scope.

How does corporate funding work?

In ‘Cause Related Marketing’ (Butterworth Heineman 1999) Sue Adkins describes a ‘continuum’ with ‘philanthropy’ at one end and ‘business basics’ at the other. In the ultra competitive world of the business person, it is easier to justify spending money on those relationships with community groups that are at the ‘business end’ of the spectrum - in other words that deliver some sort of business benefit. Author Sue Adkins describes Cause Related Marketing as ‘ a commercial activity by which businesses and charities or causes form a partnership with each other to market an image, product or service for mutual benefit’.

Specifically, what can businesses offer you?

Businesses can support you in a number of ways:

· with cash: Depending on the nature of the relationship, the sums can be very small or very large. · with expertise: When a small dyslexia charity needed a new brochure, it was printed and designed free of charge by a local printer. · with people: When the Gateshead Hilton experienced an unexpected delay in opening in 2003, the company were left with around 50 employees, already under contract, but with nothing to do. They asked Gateshead Council if they could use any people on a temporary basis to accomplish specific goals. Similarly, the City Centre Manager of Newcastle City Council was, in the late 90’s, a seconded employee of Barclays Bank.

Cash or ‘in kind’

Most of the resource that companies put into the community is not in the form of cash at all. The Directory of Social Change recently calculated the balance between cash donation and other forms of ‘community contribution’ (goods, services, etc) and found this to be the case with regard to almost every major corporate donor.

What do they want from you?

In a ‘Business in the Community’ Corporate Survey, Chief Exec’s, Marketing and Community Affairs Directors were asked what they thought could be achieved by a relationship with community organisations. The results were:

Enhance reputation: 75% Motivate employees: 54% Achieve good PR: 51% Brand awareness: 44% Develop loyalty: 39% Increase sales: 34% Deflect bad PR: 14% Trial product/service: 6%

So if your pitch puts the emphasis on ‘enhancing reputation’ or ‘motivating employees’ then they are already likely to believe you can deliver!

Your offer may be motivational: Especially at a time of recession, companies are interested in joint promotions or fun events involving their staff.

Your value may be delivered by association: A relationship with a local organisation can demonstrate to a variety of stakeholders - from local authorities, to customers to staff, that a business is committed to a specific community.

You may allow access to key groups: Companies may be interested in reaching out to the people you can reach. For example when a local supermarket launched an Asian Food line, it supported the Leicester Mela.

What if you have no ‘features’ to offer

It is still possible to build a relationship with a business and get them to support you. One way to do this is to help them build a relationship with someone else…

Many charities offer ‘corporate clubs’. Companies join and are afforded various benefits. Often they don’t really care a lot about what the organising charity does - but they like to be in the club because it helps them build other valuable business relationships.

For example the Royal Shakespeare Company raised money for its Globe Theatre in London by allowing sponsors to join their corporate club. The club had a number of different levels, with increasing benefits, dependent on the size of the member’s contribution. The five status levels were:

1) The Lord Chamberlain’s Men 2) Master of the Revels 3) Countess of Pembroke’s Circle 4) The Patrons 5) The Nobles

Barrow in Furness Council has set up an Arts Club to raise money from local businesses for its Leisure Department. The list below shows the three levels with examples of the kinds of company who have joined:

1) Level Member example Membership Cost 2) Gold British Gas £3,000 3) Silver Kimberley Clark £2,000 4) Bronze Furness Plastics £1,000

In 1997 this raised around £65,000 of ‘free’ income to be spent on arts activities. In return for their money, member organisations were invited to a black tie dinner. Gold members got a better seat and preferential treatment over Silver - who in turn got a slightly better deal than the Bronze members.

So what of the future?

It might seem logical that businesses will withdraw from community involvement when times are hard. But in fact the opposite may be true. As companies find that they need to become more competitive, one way they can do this is through the added value that Corporate Social Responsibility offers. A tough economic environment means that they have problems - and you may be able to help them solve those problems - the simplest example being by helping to motivate staff with team building challenges, fundraising events and so on.

What should your proposal look like?

It of course depends on the company - and who you represent. But if there are constant, unchanging principles, they are these:

  1. Start small - Take your time building the relationship - no one gets married after a first date!
  2. Go in ‘warm’ (if you can) rather than ‘cold’. In other words use contacts to find clients, customers or suppliers of the business to introduce you.
  3. Find out what they are most likley to want from the relationship. Motivated staff is a good place to start.
  4. Focus on companies with which you share some territory (the same neighbourhood, the same customers, the same issues, similar values, etc)
  5. Don’t ask for money - find creative ways to use their muscle, expertise, contacts or skills to save you money or deliver services and outcomes that you would otherwise have to pay for.

Keep Smiling!

Mark

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