Charity or Strategy: The Hidden Motives Behind Corporate Donations
- Francisco Alonso
- Jun 9
- 2 min read
Since ancient times, donating has been viewed as a purely charitable act—offering a meal, some money, or unwanted items with the sole intention of helping others, without expecting anything in return. During the Middle Ages, donations were encouraged by ecclesiastical figures, such as bishops, as a way to “purify” one’s soul from sins like greed and pride.
However, with the evolution of economic systems and the rise of globalization, companies operating in increasingly competitive environments have come to see donations as a strategic tool to differentiate themselves. As a result, there has been a significant increase in corporate contributions to various charities.
But, does this mean we have increasingly become more humble? On one hand, yes, with the awareness risen about many matter among society, with climate change, world hunger or child support being the most fought causes. Nowadays, with companies investing in Social Corporate Responsibility (SCR), firms have decided to grow through internal funding, creating charities for different matters, like the Ronald McDonald charity for children, with more than 2 million dollars donated to child support.
Through these philanthropic actions, political parties are able to collaborate with firms in order to accomplish different political manners, like the examples mentioned above in this article. However, there is not just a philanthropic background on the decisions these firms make. Donating has a strategic purpose after all, since massive amounts of money are managed– since it is the same principle as taking the right decision for an investment a company would like to make–.
An article published by the Chicago Booth Review demonstrated how corporations use charitable giving to wield political influence. Companies spend almost three times supporting charities with a political intention rather than supporting straight PACs, in which they distribute the money from the donors to support candidates. This indirect contribution is therefore an example of a strategic use companies can give to a donor activity.
Another “chess-minded” reason a company might make a donation is not to differentiate itself in the market, but to reduce costs by avoiding taxes. By donating to charities, companies can lower their taxable income, effectively easing their financial obligations to the government. This strategy is a double-edged sword: on one hand, it does contribute to society, channeling hundreds of millions of dollars toward important causes or underrepresented groups. While this may appear altruistic, it also serves as a strategic move to offset tax liabilities. A notable example of this was when the acclaimed camera company GoPro donated $500 million to the Woodman Foundation. This donation helped Nicholas Woodman, GoPro’s founder, significantly reduce the massive tax bill he faced following the company’s IPO in 2014.
A principle in Kant’s contemporary philosophy illustrates the central idea of this article: helping others is not always as selfless as it appears. Sometimes, people offer help not purely out of goodwill, but because of the personal satisfaction or emotional reward they gain from doing so. While the action itself may benefit someone, the underlying intention may be more self-serving than it seems.
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