What is Corporate Philanthropy?

Corporate philanthropy is the act of donating money to social causes. In these times, when corporate social responsibility is the buzzword what with governments specifying the terms under law, corporate philanthropy is no longer the earlier scenario where employees pool together money with matching contribution from the organization and then they decide to donate it to charitable and social causes. On the other hand, corporate philanthropy in recent years has taken on a dimension that is equal in scale and scope to a separate organization by itself.

Further, corporate philanthropy is not limited to interactions between the corporate communications teams and individual NGO’s but instead, it operates on a vastly larger scale.

What is Direct Marketing?

Direct Marketing is the act of reaching out to the people by sending mailers and promotional messages with the intent of persuading them for a specific purpose. Typically, direct marketing is handled by the corporate communications teams since they have the expertise and the bandwidth to send mass mailers and promotional materials directly to the target audience.

However, in recent years, because of the sheer volume of material that is being sent out as well as the large numbers of people in the target market, separate departments have been setup to handle this activity.

Further, there is coordination between corporate communications team and the direct marketing team to ensure that the message is lucid, clear, and catchy.

Dedicated Teams or Part of Corporate Communications

We have discussed how more and more business leaders are giving away a large portion of their wealth to philanthropy. Wealthy businesspersons like Warren Buffett, Bill Gates, NR Narayana Murthy, and Azim Premji, have been in the news recently because of their humungous contributions to social causes.

In this context, the debate over whether corporate philanthropy must be part of the functions of the corporate communications teams or whether it must be separate and a specific department setup for it has arisen.

The bottom line for this debate and the conclusive answer is that if the organization is large, then there can be a foundation that caters to the specific purpose of philanthropic activities.

The examples of the Infosys Foundation and the Azim Premji Foundation are among the well-known cases where separate foundations have been setup. On the other hand, if corporate philanthropy is done on a smaller and individual scale where the corporates reach out to initiatives rather than causes, then the function can be part of the corporate communications function.

Closing Thoughts

Though corporate philanthropy and direct marketing are as different as chalk and cheese, nonetheless the commonality between the two has to do with corporate communications handling both these activities. This is because essentially both entail reaching out to the external world and since this is the function of corporate communications, it is included in their list of activities. Finally, with increasing complexity as well as large numbers of activities being part of these two functions, many organizations either are outsourcing these activities or are setting up exclusive departments to handle them.