Corporate investment in social impact appears to show no signs of slowing down. However, corporate philanthropy leaders appear to be evolving their approach to place greater emphasis on tangible outcomes and less on inputs such as dollars given or number of employee hours volunteered.
The trends suggest nonprofits would do well to offer a variety of program options to meet this evolving landscape of corporate giving, according to the 2024 State of Corporate Purpose report released recently by social impact software company Benevity in Calgary, Canada.
That’s what a team of researchers concluded. The researchers studied how trends relating to corporate social responsibility (CSR), diversity, equity and inclusion (DEI), and environmental, social and governance (ESG) concerns are influencing corporate social impact strategies. Data and insights in the report were obtained from Benevity’s client base of nearly 1,000 companies and from survey responses provided by more than 400 corporate philanthropy leaders.
The incentives for nonprofit leaders to heed the findings are strong given the 63% of respondents who expect to budget more dollars for corporate social impact investment during 2024, according to the authors. This expected increase is consistent with data that showed corporate giving including direct and matching grants grew 14% during 2023, even as giving by individuals fell 9% amid high inflation worries. Employee participation in company-backed volunteerism also grew 56% last year with more than half of the increase coming from first-time participants as pandemic-related worries continued to recede.
However, corporate leaders are increasingly looking for measurable outcomes that prove the work doesn’t just “feel good” but actually “does good” and is providing a positive return on investment (ROI). “Corporate philanthropy leaders who can prove to their C-suite, boards and other stakeholders that social investments deliver business and social value will be the ones to sustain that budget for the long term,” said Sona Khosla, Benevity’s chief impact officer and head of its Benevity Impact Labs research arm that produced the report.
This “impact mindset” is to some degree reflective of companies becoming more sensitive about the risks of publicly weighing in on divisive and polarizing social issues. Instead, they’re looking for results. “It’s clear we’re moving on from the era of big statements to a longer-term, more embedded approach where DEI, trust-based practices, and crisis relief are now part of the pulse of corporate programs,” Khosla said.
Two areas that might particularly benefit are artificial intelligence (AI) and climate-related efforts. The growing emphasis on “AI for Good” is driving companies to support grants, in-kind donations, skills-based volunteerism, and education designed to equip nonprofit leaders with knowledge of how to use AI to their benefit and to address broader social issues. The lead-up to 2030 Net Zero targets is also driving an increase in support for sustainable technologies and conservation. “This is a way of both accelerating and diversifying their carbon offset initiatives, as well as expanding the footprint of their environmental commitments across their business culture and operations,” Khosla told The NonProfit Times.
The demand for trustworthy and standardized data that supports these efforts will dominate the space for at least the next three to five years, Khosla said. The same is true of corporate-backed volunteer programs. The downside of this focus on data, reporting and measurement is the increased burden it could end up placing on nonprofits. Still, “it’s crucial nonprofits make this shift if they haven’t already done so,” she said.
“The early 2020s were marked by companies highly focused on responding to crises, which shifted budgets and approaches to granting. While businesses are now taking a more strategic and forward-looking approach – tying their strategies back to their core corporate values – it’s inspiring to see so many businesses embedding a crisis and DEI lens into the full range of their granting programs, resulting in greater equity and resiliency over time,” said Khosla.
