Dollars and Jens
Tuesday, January 11, 2005
Do companies give enough to charity?
These figures pale in comparison to the profit generated by U.S. companies: oil giant ExxonMobil, for one, made $17 billion in the first nine months of 2004. That's leading some in philanthropy to question whether more can be done.
I certainly wouldn't think the right amount would be on the same order of magnitude as profits, though I would expect both to correlate with the general size of the company.

There are tax reasons for companies to contribute money to charity, rather than simply distributing the money for shareholders to contribute as they would like. (Hence Berkshire Hathaway's now defunct program allowing class A shareholders to designate charities to which contributions would be made.) There may also be genuine economies or business benefits, as is often the case when a company contributes its own product. At some companies, though, corporate charity has included large bequests to the alma mater of the CEO; unless an unusual number of the company's shareholders had an interest in that particular school, this is probably closer to embezzlement than it is to actual charity.

I don't imagine many shareholders of most companies give nothing to charity, nor that they object to charitable giving in general, but, tax benefits aside, there's little call for much of that to be done on their behalf, instead of giving them the choice as to where to put the money themselves.

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