Transcript Director Interlocks and Political Cohesion among Corporate

Corporate Support for
Public Affairs Nonprofits
Corporate Philanthropy: Some Basics
• There was relatively little corporate
philanthropy before the 1960s.
• Most large firms now make sizeable
contributions to nonprofits.
• Corporate contributions are mostly in cash,
but some are in-kind.
• Two channels of corporate giving to
nonprofits:
– Direct corporate giving
– Corporate foundations
Motives of Corporate Philanthropy
• Boosting sales and profits; coordinated with
marketing and advertising
• Enhancing conditions for long-term economic
returns
• Legitimation: presenting an image of social
responsibility
• Deterring and providing alternatives to
government programs
• Coopting and building bridges to potential
adversaries
• Reducing corporate taxes
The Scale of Corporate Philanthropy
• Corporate foundations made grants of $4.2
billion in 2006.
• This constitutes 11% of all foundation grants.
• Total corporate grants (including direct
giving) were $13.8 billion in 2005.
• If direct giving was included with foundation
giving, corporations would account for 29%
of all foundation grants.
• Corporations account for roughly 5% of all
private philanthropic giving.
Recipients of Corporate Foundation
Grants in 2005
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Education 25%
Public affairs 22%
Human services 19%
Health 12%
Arts and culture 11%
International 4%
Environment and wildlife 3%
Science and technology 2%
Other 1%
Motives of Corporate Support for
Public Affairs Nonprofits
• Corporate conservatism: funding
pro-business, right-wing organizations
• Corporate pragmatism: building
bridges to liberal and moderate
organizations
Who Gives the Most?
50 Largest Corporate Foundations (2005)
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Health and pharmaceuticals (N = 11) : $495 million
Banking and finance (N = 11) : $444 million
Insurance (N = 5) : $114 million
Energy, oil, chemicals, mining (N = 7) : $244 million
Motor vehicles (N = 4) : $169 million
Retail, consumer non-durables (N = 6) : $292 million
Telecommunications (N = 3) : $152 million
Miscellaneous (N = 3) : $75 million
Who Receives the Most?
The Capital Research Center Data
• CRC was founded in 1984 to combat “liberal bias” in corporate
philanthropy.
• Published “Patterns of Corporate Philanthropy” periodically
through 2001.
• Rated corporations on the liberalism/conservatism of their public
affairs grants.
• Ranked public affairs nonprofits from 1 (“radical left”) to 8
(“market right”).
• Weighted grants by ideology and dollar amount to give each
corporation an overall score.
• Publicized results to CEOs in effort to influence corporate giving.
• CRC report for 2001: includes 90 corporations and 357
nonprofits for the year 1997.
Top 50 Public Affairs Nonprofits Receiving
Grants from 90 Large Corporations (1997)
Policy Planning and Advocacy
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2. Council on Foreign Relations $2,195,050
4. Brookings Institution $1,722,000
5. Chamber of Commerce $1,517,029
11. American Enterprise Institute $965,000
15. East-West Institute $793,000
16. Center for Strategic & International Studies $760,000
17. Economic Strategy Institute $575,000
18. Committee for Economic Development $547,500
20. Carter Center $480,000
21. Ethics Resource Center $412,500
30. Rand Corporation $360,000
32. Heritage Foundation $341,000
33. National Alliance of Business $331,000
37. Citizens for a Sound Economy $317,000
38. Institute for International Economics $317,000
40. Aspen Institute $280,000
44. Competitive Enterprise Institute $25,5000
46. Joint Center for Political & Economic Studies $247,000
48. Manhattan Institute For Policy Research $222,000
50. Cato Institute $220,000
Top 50 Public Affairs Nonprofits Receiving
Grants from 90 Large Corporations (1997)
Civil Rights
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1. Urban League $3,917,444
10. NAACP $1,052,650
22. Anti-Defamation League $406,800
25. National Council of La Raza $392,000
27. National Council of Negro Women $381,667
42. League of United Latin American Citizens $260,500
43. National Organization on Disability $260,000
49. Mexican American Legal Defense & Education Fund $221,500
Health and Human Services
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6. American Heart Association $1,303,985
12. American Cancer Society $943,509
13. Families & Work Institute $850,000
19. American Federation for Aging Research $519,000
29. National Council on the Aging $363,500
35. Children’s Health Fund $325,000
36. Child Welfare League of America $320,000
39. American Council on Science & Health $299,000
47. Children’s Defense Fund $227,500
Top 50 Public Affairs Nonprofits Receiving
Grants from 90 Large Corporations (1997)
Environment and Wildlife
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7. Conservation International $1,298,500
8. Nature Conservancy $1,285,145
41. Resources for the Future $280,000
41. Ducks Unlimited $262,500
45. World Wildlife Fund $250,260
Education
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9. National Education Association $1,243,105
24. Public Education Network $394,200
28. Education Commission of the States $378,900
31. Students in Free Enterprise $350,500
34. National Head Start Association $325,705
Community Development
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3. Enterprise Foundation $1,940,750
23. Points of Light Foundation $395,000
26. Assoc. of Community Organizations for Reform Now
International Development
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14. Accion International
$846,128
$385,000
What Influences Corporate Giving to
Public Affairs Nonprofits?
• Hypotheses from research on corporate philanthropy:
– Consumer goods industries contribute widely to promote image.
– Corporations tend to concentrate grants in their local region.
• Hypotheses from research on corporate PACs:
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Traditional regulated industries are more pragmatic/bipartisan.
Defense contractors are more pragmatic/bipartisan.
Regulatory violators exhibit more right-wing partisanship.
Firms in South and Midwest exhibit more right-wing partisanship.
• Hypotheses from research on policy board members:
– Traditional regulated industries have closer links to moderates.
– Sunbelt (South and West) firms have closer links to right-wing.
• Hypotheses from research on corporate networks:
– Firms with board interlocks exhibit similar political behavior.
Industry Differences in Corporate Giving
Average CRC Rating (High = Right-Wing)
4.6
4.4
4.2
4
3.8
3.6
3.4
3.2
3
All firms
Consumer
Trad Reg
Reg Viol
Defense
Regional Differences in Corporate Giving
Average CRC Rating (High = Right-Wing)
4.6
4.4
4.2
4
3.8
3.6
3.4
3.2
3
All firms
East
Midwest
South
West
Percentage Overlap in Nonprofits
Supported by Dyads of Firms
16
14
12
10
8
6
4
2
0
Random
Dyad
Same
Industry
Same State
Director
Interlock
Conclusions
• Much corporate philanthropy is hidden, so any conclusions must be
tentative.
• Corporations contribute more heavily to public affairs than do other
private foundations.
• Corporations adopt a mixed strategy of conservatism and
pragmatism.
• Conservative grants are concentrated in the policy planning area.
• Pragmatic (moderate/liberal) grants are concentrated in civil rights,
health, and environment.
• Variations in corporate giving follow a similar pattern to other forms
of corporate political action.
• More speculatively, corporate grants are of sufficient scale to have
an impact on the program and politics of public affairs nonprofits.
• Even more speculatively, relative to other funding sources,
corporate grants are likely pull both left- and right-wing nonprofits
toward the political center.
THE END