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27 Feb. 2015 | Comments (0)

North American companies are least likely to disclose charitable contributions information, despite median contributions being higher than companies in any other region. This is one of many findings from The Conference Board’s Sustainability Practices Dashboard 2015, a comprehensive database and online benchmarking tool that captures the most recent disclosure of environmental and social practices by the S&P Global 1200 and segments them by market index, geography, sector, and revenue group.

Compiled by Matteo Tonello and Thomas Singer, the updated dashboard looks at how companies report against 79 environmental and social practices. It finds that European companies are the most likely to make their charitable contributions data public, with 55 percent of companies disclosing that information in 2014, an increase from 47 percent in 2013. Only 32 percent of North American companies shared such information (albeit from a larger sample size)—joining Latin American companies at the bottom of the group. [caption id="attachment_975" align="alignleft"

What’s interesting about this is that it’s not like American companies have anything to hide—they outperformed all other regions in terms of total contributions. American companies that disclosed charitable contributions logged median contributions of around $18.5 million, a 28 percent increase from 2013 and nearly $10 million more than their European counterparts, which placed second. This increasing trend supports the findings of Giving in Numbers: 2014 Edition, published by CECP in association with The Conference Board, which found a year-over-year increase in the percentage of companies that grew their corporate contributions budgets between 2010 and 2013. It is important to note that whereas the Giving in Numbers Survey, which is currently open for submissions, collects data from companies with revenue in excess of $2 billion, Sustainability Practices considers all S&P Global 1200 members, including those with revenues under $1 billion. 

Why so shy?

These findings beg the question of why North American companies are so reticent to report publicly the amount they donate to charity. It could be a cultural issue—European companies have led the field in terms of CSR transparency for many years (the GRI itself emerged from Europe). It could be a data collection issue—the US philanthropy sector is much more mature and complex than in Europe, making it difficult for companies to capture the true value of the total contributions they provide to society. Or perhaps it’s that the aggregate figures in the chart above don’t tell the full story—are US companies concerned about the results if stakeholders were to look at total giving as a percentage of pre-tax profits or revenues?

I suspect that all three of these suggestions factor into the equation, but clearly corporate disclosure of charitable contributions in North America can be improved.

Or is it more about impact?

There is likely a fourth argument to explain the lack of disclosure of corporate contributions data in North America: companies are more interested in evaluating the impact they create than the amount of money they donate. Such an argument from the sector is a valid one, but as I’ve found in collating information for a number of publications on the topic, including Framing Social Impact Measurement, progress in this practice is somewhat slow. Many challenges, such as a lack of resources and expertise at nonprofit organizations to conduct such evaluations effectively, continue to hamper the sector.

Given that we’re still at an early stage in terms of social impact measurement, it is still important to understand just how much companies direct to nonprofit partners. After all, measuring social impact is not only the purview of American companies—Europeans are trying to do this more effectively also, but clearly they haven’t lost sight of the value of transparency.

General disclosure against the GRI

Sustainability Practices does reveal a precedent for greater transparency more broadly in the sustainability and CSR field. The dashboard shows that even though the overall environmental and social disclosure rate among global companies has remained essentially unchanged over the last year, reporting using the GRI framework continued its rise in the United States, and one out of three large U.S. companies now adopt those guidelines.

About Sustainability Practices

The Conference Board Sustainability Practices Dashboard and the analysis included in this report are based on data compiled by Bloomberg and drawn from multiple sources, including periodic sustainability reports, corporate websites, and a survey of corporate sustainability officers. Data included in this edition are from the most recent year available on Bloomberg as of September 19, 2014.

The analysis includes a total of 79 environmental and social practices—encompassing, among others, atmospheric emissions, water consumption, biodiversity policies, labor standards, human rights practices, and charitable and political contributions.

To see the complete dashboard, please visit www.conference-board.org/sustainabilitypractices.

  • About the Author:Alex Parkinson

    Alex Parkinson

    Alex Parkinson is Principal of Parky Communications, a communications agency specializing in sustainability and CSR reporting and communications. He serves as the Co-Leader of The Conference Board Cor…

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