When it comes to corporate giving, small charities and unpopular causes often lose out to big organisations. Catherine Walker asks what can be done

If we’re being honest about it, companies don’t really do much for charity. The Directory of Social Change (DSC)’s new Company Giving Almanac 2013 (‘the almanac’) estimates that companies’ overall support for the UK charitable sector is between £700 and £800 million a year. That represents just 2 per cent of all charities’ income (compared to 43 per cent from individuals). Of course there are exceptions to this rule, and some companies do some amazing work with charities, but overall charities are the Davids to the corporate Goliaths.

This analogy becomes even more apt when you consider the position of smaller charities, who rarely get a look in when it comes to dividing Goliath’s spoils. Companies tend to give to larger charities, and their donations make up 5 per cent of income for those charities with £10m-plus income. But for those with incomes of less than £100,000, corporate giving accounts for just 2 per cent – and it goes down to 1 per cent for those with an income under £10,000.

Furthermore, in 2012, approximately three-quarters of corporate grants to the voluntary sector went to the largest 3 per cent of charities.
Small charities often do not have access to large companies, yet these remain the preferred partners in terms of what they have to offer. This doesn’t mean that small amounts of corporate sponsorship are not important to smaller charities and community groups, but certainly companies could do much more.

Sizeable problems

The latest trend is for companies to adopt a longer-term partnership approach with a smaller number of charities. This brings with it challenges – not least of which is that the few that are chosen are likely to be those whose profile is already large enough to fulfill the companies’ ambitions in terms of advertising, prestige and associated benefits. This means that smaller charities will find it increasingly hard to get a look in, despite the fact that charities with incomes of less than £100,000 per annum make up over 80 per cent of registered charities in the UK.
The same is true when it comes to less popular causes.

‘From the Company Giving Almanac 2013 ’ (hi-res version in folder]

Our research shows that community and social welfare, educational, and children and young people’s causes are most popular, with more than 50 per cent of companies supporting them. Causes such as human rights, inner cities, women’s issues and equal opportunities are less popular, with fewer than 10 per cent of companies supporting them. Funding of less popular causes is often delegated to the corporate foundation, which, at an arm’s length from corporate cultural strictures, has more freedom in its choices of causes and beneficiaries (although this is not true of all companies).
Ironically, the spread of more democratic procedures in the workplace also favours more established charities and ‘safer’ causes. Both managers and shop-floor staff recognise that widening employee participation in the selection of charitable beneficiaries creates an inbuilt advantage for those charities with the best name recognition and the most widespread support.
Perhaps smaller businesses would be a better match for small charities. While they may not have the same cash reserves, they may be more deeply rooted in their local communities and be eager to support the charities working in them.

Mystery figures

However, very little is actually known about charitable support among small businesses. The British Chamber of Commerce, back in 1998, reported that eight out of ten small companies gave money, and one in three gave time and services, but the figures did not measure actual support and impact. In our own research for the almanac, we found that even among the top company givers, the money is concentrated at the very top – 20 per cent of companies give 90 per cent of the cash.
DSC’s Great Giving campaign (‘the campaign’) aims to achieve better relationships between charities and their funders. In the recent past, it has focused on issues such as the accessibility of funding and eligibility issues. We want to support and help develop good funding practice among those organisations that give to charities.
Following the recent publication of the almanac, the campaign is now focused on ways of improving company giving for charities. DSC is planning a schedule of actions, events, media work, further research and practical programmes aimed at companies and those charities who seek to work with them or fundraise from them.
Underpinning this campaign is the belief that our society needs companies to give more, that we need more companies to give, and that we need better giving.

To find out more about the Great Giving campaign, get in touch at greatgiving@dsc.org.uk or follow on Twitter @Great_Giving

Catherine Walker is head of sector trends, evidence, analysis & metrics at the Directory of Social Change
This article first appeared in The Fundraiser magazine, Issue 31, July 2013