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Total FTSE 100 charitable donations continue to fall, but some companies give more

Almost half the UK population think businesses have an obligation to support charitable causes, while corporate giving by the FTSE 100 has continued to fall, according to the Charities Aid Foundation.

CAF’s research comes a week after BlackRock chief executive Larry Fink called on global companies, including FTSE 100 members, to make a ‘positive contribution to society’. In addition to reviewing charitable giving, a survey of 1004 adults was carried out by YouGov for CAF. Almost half those surveyed (48%) agreed that ‘businesses have an obligation to support charitable causes’. Many companies are already choosing to demonstrate how charitable giving plays a vital role in developing purpose, building trust, encouraging employee engagement, enhancing corporate reputation and delivering critical social value.

Today’s report found that total donations in absolute terms by the FTSE 100 have continued to fall year on year, to a total of £1.9 billion in 2016. This is down by 11% (£235 million) since 2014 and by 26% (£655 million) since 2013.

Owing to a handful of companies giving more, however, the overall combined FTSE 100 percentage of pre-tax profit donated has increased. The average (median) donation value has also risen to £5m. This highlights that the FTSE 100 relies on a handful of generous corporate donations, while at the same time, suggests that the vast amount of organisations in the FTSE 100 continue to donate at similar levels to previous years.

According to CAF, pharmaceutical companies continued to dominate charitable giving, with basic materials and health care companies (of which pharmaceuticals is part) accounting for 55% of donations in 2016. This is at odds with the general public’s perceptions. CAF’s research found that 37% of people surveyed think consumer services lead the way for donations, with consumer goods second at 19%, whereas in reality, between them they account for 18% of total donations by FTSE 100 companies.

The vote to leave the EU has not heralded major shifts in the giving behaviour of major companies. 

At the time of CAF’s previous report in 2016, we reported that a change in legislation meant companies no longer had to report their corporate donations, undermining efforts to make corporate giving open and transparent. A total of 15 FTSE 100 companies chose not to specify their corporate donations for the 2015/16 financial year and any donations they made are therefore not included in the report. 

In addition, companies choosing not to be transparent could be missing an opportunity to positively engage consumers. CAF’s survey found that more than half (56%) agreed that they would be more inclined to buy a product or services form a business that donates to charitable causes. On average, people thought that only 35% of the FTSE 100 donated to charitable causes in a typical year, while 60% agreed that ‘corporate responsibility is just a PR exercise for business’.

Klara Kozlov, Head of Corporate Clients at Charities Aid Foundation, said:

“Company giving is critical. Unfortunately the downward trajectory for corporate giving continues, with fewer companies replenishing a depleted pool of money donated to charitable causes.

“This is certainly a concern for charities. It is vital that civil society can work with businesses to show how partnership between charities and business can benefit both, as well as greatly enriching society.”

“We believe company giving, both financial and non financial, is vital. It helps to deliver positive impact and enables the convergence of interests between business and society and, by doing so, fosters integrity and bolsters trust.”


Click here to read the full report.