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Corporate Giving in Flux, But Not Disappearing, Study Shows

(Feb. 2, 2009) Though corporate giving levels are predicted to decrease in 2009, many corporations and corporate foundations are holding steady in the amount they plan to give.

Although 42 percent of corporations and 37 percent of corporate foundations recently surveyed say their charitable giving budgets will decrease in 2009, LBG Research Institute predicts that the overall decrease will be far less than the 12.1 percent drop in 2001, as reported then by Giving USA.

“When you look at the size of predicted budget increases and decreases across the sample, the percentage decrease will probably be in the range of 3 percent to 5 percent,” estimates Donna Devaul, the institute’s executive director.

Exactly half (50 percent) of corporate foundations said that their giving budget (including cash and non-cash) will stay the same in 2009. Thirty-seven percent, though, said this budget will decrease. Only 4 percent said their charitable giving budget will increase.

As for corporations themselves, more respondents are decreasing their giving budget (42 percent) and fewer said their budget is staying the same from 2008 to 2009 (35 percent).

Shifting Priorities

Corporate giving budgets are also being adjusted in terms of the causes they support. The 76 corporations and corporate foundations that responded to the study survey indicated a sharp move away from arts and culture and toward basic needs (food, clothing, shelter) and environmental causes.

In fact, about half (49 percent) of those that supported arts and cultural institutions in 2008 said they will decrease their giving in that area in 2009. Twenty-four percent of corporations and corporate foundations that support environmental causes plan to increase their support in 2009 for this area. Of those that in 2008 supported organizations serving basic human needs, 23 percent will increase their support this year.

Local Focus

About 84 percent of study participants said they plan to be more strategic with their giving in 2009. For many this means that they will shift to supporting local organizations instead of national ones. Corporations said they want to give more money to fewer organizations to increase the impact of their gifts, possibly explaining the trend toward local support. Also, Devaul said that corporations are motivated by the added goodwill they receive by supporting local organizations.

In fact, 46 percent of corporations and corporate foundations report that they anticipate a greater percentage of giving going toward local versus national organizations in 2009 than from the previous year. A quarter (25 percent) said they expect to shift more than 20 percent of their budget to local organizations and away from national ones.

LBG Research Institute’s report, Doing More With Less: How the Economic Downturn Will Impact Corporate Giving in 2009, is available for a fee at the institute’s website.

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