Women, new CEOs mean more corporate giving

Guess what leads to more giving from corporate funders? Women in charge.

According to Harvard Business School’s Christopher Marquis and Matthew Lee, the number of women in high seats in a corporation is directly associated with its levels of corporate giving. Higher levels of generosity, they say in a new report, are associated with female ownership and leadership.

In addition to women CEOs and Board members, Marquis and Lee found that another leadership factor influences corporate giving. Companies with newer CEOs tend to give more than companies whose CEOs have been in office for a while. New CEOs, they report, are eager to launch new initiatives and look for high-profile organizational change and impact.

Bigger Boards give more, say the researchers, but they may have less governance. A bigger Board equals more corporate giving but less unified strategy and less oversight, they say. Members of bigger Boards are more able to use “corporate” giving to fund their own pet projects.

The study also found that companies whose headquarters are located in lower-income areas give more. This is likely because decisionmakers are more exposed to local needs and issues, and because there’s comparatively more opportunity to assert their role in a community.

Between one third and one half of corporate giving is made through foundations, which must file publicly accessible 990PFs. The rest is below the radar, with no reporting requirements. Research into corporate giving has typically been hindered by the fact that companies are reluctant to disclose this information. As Rick Cohen wrote in Corporate Giving: Decloaking Stealth Philanthropy, it’s not uncommon for corporate Boards to give large grants to “nonprofit” special interest groups and “think tanks” that advance their corporate position or employ their members. Despite a call to increase disclosure and reporting, grantmaking has not yet been targeted as part of corporate accountability reforms.

Marquis and Lee don’t offer advice for nonprofits, although the research reinforces several age-old principles of corporate grantseeking: find companies with ties to your community, look for business practices specifically aligned with your mission, and research who’s in influential positions in those companies (hopefully new women CEOs). Also, corporations see grants as a kind of marketing investment—organizations with a good PR opportunity still have a better shot at corporate grants.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s