Business support for small charities a ’rounding error’, averaging just £450

The average business in England contributes just over £450 worth of support to small charities and community groups each year, according to a new study.

Research conducted for the Law Family Commission on Civil Society shows that businesses donated services and funds worth an estimated £2.4billion in 2019 to small charities and community groups – equating to around 0.06% of private sector turnover.

This includes £1.9bn in financial donations and around £474million worth of pro bono support such as legal services, in-kind donations such as the use of office space and employee-supported volunteering.

The study found that on average businesses across England donated just £456 each year to charities and community groups with annual income below £25m.

While there are many examples of businesses and civil society working closely together, this latest research suggests there are significant gaps in the relationship and that the partnership is not operating at its full potential.

The new study comes amid growing calls for greater social impact from the business community.

A recent survey by the Institute of Directors found that 62% of members believe that businesses should not exist solely to make money and generate shareholder profits.

But among the public there is increasing scepticism about the private sector’s commitment to social purpose. According to a recent survey by Deloitte, fewer than half of Gen Zs and millennials perceive business as a force for good in society, while the number of millennials who believe that businesses focus solely on their own agendas rather than considering wider society rose between 2019 and 2021.

The Law Family Commission on Civil Society is encouraging businesses to seize the opportunities that working with civil society can create. It believes business and civil society can be incentivised to work more closely together, that connections between the two need to be increased, and that partnerships need to be made as effective as possible.

The detailed study of 4,000 organisations by University of Durham Professor Tony Chapman for the Commission also found that:

  • Businesses give most support to charities for children and young people and focus attention mainly on poorer urban areas. Those charities that serve the interests of carers and people with learning difficulties are most likely to say that business supports them well, while those which serve BAME and rural communities are the least likely to be well supported.
  • Charities and community groups which received support from business are generally positive about their experiences, with 84% saying businesses trusted them to be well organised and professional.
  • Three quarters (73%) of charities and community groups say they struggle with opportunities to meet businesses.

James Timpson, CEO of Timpson and Commissioner of the Law Family Commission on Civil Society, said:

“There are many examples of businesses around the UK that do brilliant work with civil society, whether it be through community outreach programmes, employee-supported volunteering or simply the donation of much-needed funds. But there is no doubt that businesses of all shapes and sizes can and should do more.

“Businesses that put philanthropy at the heart of their outlook not only help civil society, they help themselves too. Showing empathy and kindness as a business will help you become an employer of choice and it will help you make more money because customers prefer to spend with companies that care.

“We have seen the great strides made by business in pursuit of other vital causes, such as sustainability and equal pay. The next great stride that business can take is to commit to a partnership with civil society. Investors may have a key role to play in this, as might transparency measures – as they have on other social issues. No matter how it is achieved, a strong partnership between business and civil society can only help to improve both communities and companies.”

Mitch Oliver, Global VP Brand & Purpose at Mars and Commissioner of the Law Family Commission on Civil Society, said:

“It has never been more important for business and civil society to pull together. By working together, we can be stronger and accelerate the recovery from a pandemic that has sadly slowed progress in many of the areas that we all care about. The mission to secure a healthy planet, an inclusive society and a world where everyone is thriving is strengthened when business and civil society collaborate.

“And it is not simply on the big issues that business and civil society can make a real difference together. There are a multitude of small social sector organisations working to improve lives within individual communities across the UK that would be enhanced no end by the support of local business.

“I’m proud to work for Mars, a company driven by its purpose – ‘the world we want tomorrow starts with how we do business today’ – and which believes that to get there we need to harness the power of uncommon collaborations. At Mars, we work globally with partners such as UN Women and CARE international at a global level and, more locally in the UK, with a number of NGOs including the Happy Mums Foundation and the National Emergencies Trust.”

Nicole Sykes, Director of External Affairs at Pro Bono Economics, said:

“Purpose has become a watchword in every business boardroom in recent years. Customers, investors, shareholders and employees all expect a commitment to social good. But business’ efforts will fall short if they fail to work with civil society.

“This new research shows that the average annual contribution to small charities from businesses in England amounts to little more than a rounding error. The average business in England donates the same amount of cash to small charities each year as they misplace from their petty cash. It’s no wonder high proportions of the public are sceptical of business’ efforts to paint themselves as about more than just profit.

“This represents an ocean of missed opportunities for business to make a meaningful difference in communities around the country. If these opportunities are realised it will only enhance the success of both business and civil society.”

Professor Tony Chapman, Director of Policy and Practice at St Chad’s College, Durham University, said:

“While the financial and in-kind support business currently gives to charities is barely a fraction of business turnover, their contribution is highly valued by the organisations and groups who work well with businesses.

“However, relationships that are formed seem to happen mainly by accident, rather than design, so there is room for improvement on both sides of the fence to build connections between sectors at the local level.”

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