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Corporate Funding Came Back After the Recession, But Did it Leave the Arts Behind?

Posted by Michael Stroik
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While a new report shows that the global recession shifted funding away from the arts, is there a silver lining in how companies have changed their view of investing in communities?  CECP, in association with The Conference Board, recently released Giving in Numbers: 2013 Edition, an annual analysis of corporate giving trends among the world’s largest businesses. Despite a slow economic recovery, the majority of companies gave more in 2012 than in 2007, before the recession, yet the majority of funders decreased their funding of the arts. Companies decreased arts funding annually in each year from 2007 to 2012. The steepest declines occurred in 2008 and 2009, at the height of the global recession.

 

The news is not all bad for arts organizations. While the majority of arts funders have decreased funding, many continue their support today. In fact, behind only education and health and social services organizations, more companies supported the arts than any other program area in 2012, albeit at lower financial levels (Giving in Numbers, page 20). Revenues and profits have increased for large businesses since 2009, and giving budgets are expected to grow in coming years.

 

The shift away from the arts is likely related to many factors and trends occurring across the corporate philanthropy field. Companies aim to drive measurable societal impact with each grant, and many focus efforts on single program areas with the hope of moving the needle on specific societal problems. So why haven’t arts agencies reaped the benefits of an increased focus on individual program areas? Based on our research, there are a variety of reasons. Most notably: 

 

  1. The Recession: During the recession it was no surprise that the fastest growing program area was community and economic development. The world’s largest businesses aimed to support community efforts to rejuvenate local economies. The hope was that economic growth, no matter how small, could spur consumer confidence and pay dividends for companies in the long-run. Many companies prioritized these programs over arts initiatives in the last half decade.
     
  2. Education Issues in America: CECP’s research sample is global but 92% of companies are based in the United States and focus the majority of funds domestically. In 2012, education support topped the list of program areas supported by large businesses for the first time since CECP first published Giving in Numbers in 2006.  American students are falling behind global peers in math and science achievement, and companies are concerned about the future of the American employee base. In addition, the racial achievement gap in student test scores (click here for more information) spotlights the social justice factors that are at stake when dealing with education programs.
     
  3. Non-Cash Giving: In-kind contributions, consisting primarily of product donations and pro bono service, accounted for more than 95% of aggregate giving growth from 2007 to 2012. Arts agencies often have fewer opportunities to work with bulk product donations; only 4% of corporate contributions to arts agencies came in the form of non-cash gifts in 2012. See Figure 11 (page 20) for more details.
     

So what can we learn from these trends to help secure future arts funding? As the field of corporate community engagement expands, arts agencies should focus on their societal impact on communities, including the educational benefits of arts programming for disadvantaged children, when approaching large businesses for funding partnerships. Arts agencies should also emphasize the strong benefits their programs have for corporate employees that engage with them. Whether this includes volunteer offerings or arts performances at corporate offices, make sure corporate giving officers understand how your work will benefit their workforce in a variety of ways.


If you work for an arts agency, have you received less funding from large corporations since 2007? How do you plan to align with corporate funders in the future?  We would love your feedback on our findings -- info@cecp.co.

 

(This post, originally published in The Line is one in a weekly series highlighting The pARTnership Movement, Americans for the Arts’ campaign to reach business leaders with the message that partnering with the arts can build their competitive advantage. Visit our website to find out how both businesses and local arts agencies can get involved!) - See more at: http://blog.artsusa.org/2013/09/26/art-and-business-connect-at-a-pop-up-think-tank-from-the-partnership-movement/#more-21829

(This post is one in a weekly series highlighting The pARTnership Movement, Americans for the Arts’ campaign to reach business leaders with the message that partnering with the arts can build their competitive advantage.)

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