Corporate heavyweights such as BHP and Coles still make the biggest charitable impact in terms of dollars, but young innovative companies are leading the way with a community-first mindset shows the latest GivingLarge report.
Corporate giving reached new heights in 2021 with $1.2 billion invested into philanthropic efforts by Australia’s top 50 corporate givers.
According to the latest GivingLarge report from Strive Philanthropy, that figure is a $42 million increase on the 2020 total, defying predictions that the pandemic would adversely affect corporate philanthropy.
Report author and Strive Philanthropy founder Jarrod Miles said, “Last year’s figures were encouraging but did leave us concerned about a possible drop in community investment this year, worrying that companies would respond to lower profits and an ongoing pandemic by tightening their purse strings. Perhaps the most pleasing result of this year’s research was to see that this prediction didn’t play out. We saw that companies held tight to their community budgets despite these challenges.”
The largest contributions came from BHP (who gave away $234 million), Coles, CSL, Rio Tinto and Commonwealth Bank.
The largest percentage contributions came from Coles, Star Entertainment, TAB Corp, South32 and Oil Search. Supermarket giant Coles contributed $124 million in 2021, representing 8.7% of the company’s profit on a rolling 3-year basis. Their 2021 figure is on par with last year’s contribution with the funds going towards food rescue, health and disaster relief.
“In a year when many Australians experienced severe hardship as a result of COVID-19 while others faced hardship in the wake of fires, floods and cyclones, we were pleased to work together with our customers, team members and suppliers to provide unprecedented community support,” said Coles Corporate Affairs General Manager, Sally Fielke.
The percentage of pre-tax profit given by the top 50 companies in 2021 was an overall 0.97%, compared to 1.11% in 2020. The change is mostly attributable to a large increase in profits in the materials and finance sectors.
Ten of the top 50 companies increased their community investment by more than 20% with the increase from the top four biggest movers adding $63 million to the overall tally of $1.2 billion. Add this to the fact that over a quarter of the total came from BHP and Coles, and you can see a similar trend to individual giving – a smaller pool giving the majority of gifts.
Not surprisingly, contributions to the environment saw an 18% increase in investment compared to last year. However most giving (68%) continued to be directed to health, education and social welfare.
Philanthropy Australia , a long-term supporter of the report commented on the critical need for research into corporate giving. “The data is essential to not only understanding how corporate Australia engages in philanthropy but also to provide inspiring examples of the innovative and transformative ways some of our businesses do their giving,” said CEO Jack Heath.
The report highlights the emergence of a new frontier in corporate philanthropy from companies such as Cotton On, Who Gives a Crap and Atlassian, which donated $13.4 million. Atlassian’s generosity is partly thanks to an initial pledge to donate 1% of annual profits, 1% of employee time, 1% of company equity and 1% of product. The Atlassian Foundation has built a corpus of $350 million and expects to increase donations in 2021/22 to between $15 million and $20 million. Based on this year’s figures, that would put the organisation on par with companies such as Deloitte and Oil Search.
Another standout is social enterprise, Thankyou, who donated $10 million to help alleviate extreme poverty in 2021, outperforming ASX 200 heavyweights Suncorp, QBE and Mirvac to enter the top 50 for the first time.
Jarrod Miles and John McLeod, co-founder of JBWere Philanthropic Services, argue that young companies are going down the giving path earlier, in part by joining the ‘Pledge 1%’ movement, set up by Atlassian and Salesforce in 2014. About 1300 Australian companies have signed the Pledge 1% movement, including venture capitalist Blackbird, Canva, Culture Amp, Wilson Asset Management and SafetyCulture. Globally, more than 15,000 companies have signed up.
The desire to attract and retain talent is also prompting young companies to give back to the community. Research by Deloitte last year found 44% of workers feel they belong in a workplace where charitable contributions are made.
“Alongside the record numbers over the last few years there is an exciting groundswell of corporate engagement and new age innovation that has well and truly arrived,” said Jarrod. “In this appealing turn of events, social good is no longer second in importance to these leading companies. Meaningful social commitments are effectively sitting in tandem with financial goals.”
Despite the encouraging totals there is still significant opportunity for growth.
“The future for philanthropy is to become more generous,” said Jack Heath, “but it’s also about being more strategic and focused in our giving: our corporate leaders have a critical role to play in leading and driving that change.”
To access the report (which incurs a fee), click here.
To read more about ground-breaking young companies leading the way, click here.