Critical factors of corporate philanthropy, their impact on monetary contribution and attributes of corporate-choice of NPO

Abstract

Introduction: Corporate Philanthropy is an under-researched area where research gaps indicate that studies are sparse on the influence of NPOs (Non-Profit Organizations) on corporate philanthropy and the integrative effect of different influencing factors. Besides the need for inputs to theory-building in the area, there is a strong need for studies that give donor insights and strategic frameworks to NPOs for more effective fundraising from the corporate sector. Keeping in mind the above-mentioned motivational routes, the present study explores the critical factors of corporate philanthropy, the critical attributes of NPOs the corporate donor considers while choosing an NPO, and the impact of the critical factors on the level of monetary donation. The study also makes donor-segment comparisons on the critical factors. Methodology: Using a qualitative approach of Content Analysis, the study elicits the relevant variables for the study and forms a conceptual framework of the initial set of variables. The questionnaire emerges from this basic framework and is refined after tests for validity and reliability. The data collected from corporate donors is subjected to statistical analysis-factor analysis, multiple regression, empirical model building, and t-tests. Findings: The factor analysis produced a set of 11 critical factors for Corporate Philanthropy. They are: Image benefits, Disposition, Awareness about NPOs, Social Cause, Perception of Non-monetary Resources, Social Comparison, Perception of Monetary Resources, Top Management, Self-interest benefits, Confidence in NPO, and Strategy of NPO. Another procedure of factor analysis produced eight attributes for NPO choice: Responsiveness, Credibility, Capability, Confidence, Communication, Channel references, Tangibility, and Top Management. Empirical model building using multiple regression indicated three strategic tools for influencing monetary donation: Perception of Resources in Kind, Top Management of the donor, and Confidence in NPO. T-tests on seven types of segmentations showed variables of interest for the respective segments. Contribution of the Study: The critical factors and the attributes of NPO, when transcribed into the conceptual framework, give rise to a model of Corporate Philanthropy which is a theoretical contribution to theory-building on the subject. A triple-task model is suggested for strategic purposes. A framework of the eight attributes is presented for NPOs for a range of strategic purposes. A framework of thrust factors for seven different types of segmentations is presented for NPOs to follow in strategic marketing. The empirical model suggests three marketing tools to influence donation amounts. Detailed recommendations are given for each of these implications. Thus, the study contributes to theory-building and also contributes to strategies for application in the area of fundraising from the corporate sector.