Strategy

The CEO Poll: Should companies give to charity?

Canadian executives divided over a corporation's charitable role.

Business leaders give the federal mini-budget high marks.

Following the earthquake in Haiti, Canadian companies rushed to donate funds and supplies, and urged employees to do the same. But a recent Compas Inc. poll of Canadian executives shows they are divided over a corporation’s charitable role.

Of those polled, 45% believe that charity is an individual shareholder’s responsibility. ‘Public corporations should leave it to the shareholders to give to charities,’ argues one CEO. Close behind, though, are the 35% who believe that corporations should support charities. ‘Being a good corporate citizen means assisting those less fortunate — as long as it is done in the context of the entities’ aims, objectives and employees’ desires,’ says another executive.

When it comes to selecting a charity to support, executives say the most important factor is efficiency and honesty, giving it a mean score of 6.3 on a seven-point scale. ‘I am concerned about the actual use of the funds when it reaches those to whom it is intended,’ says one business leader. ‘In my view, only charities that have demonstrated solid governance and have a high ratio of funds raised that are spent properly should be allowed to raise money.’ CEOs also prefer charities that are local and benefit the surrounding community, giving this factor a mean score of 5.5. Choosing a charity because it works in a disaster zone like Haiti only gets a mean score of 4.9. And with a mean score of 3.3, CEOs are least inspired by charities that honour the company or its owners.

The CEOs disagree whether companies should encourage employees to get involved with charities. ‘Companies should not do a type of emotional blackmail to get employees to give to the charity the company has chosen,’ says one CEO. In fact, the executives are split on whether businesses should urge employees to give at all, with 45% in favour and 34% opposed. For companies that are asking employees to give, CEOs feel the most appropriate method is company-wide fundraisers, with 63% support. Payroll deductions get lukewarm approval, at 51%, and having employees do volunteer work during company hours gets just 49%.