Corporate arts giving: up during the '70s and still holding its own
Is corporate giving to the arts recession-proof? Or has it fallen over the course of the past recession? Many observers are suggesting that business support for the arts has indeed held steady through the past couple of years, continuing its upward swing from the mid-'70s.Skip to next paragraph
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But Kathryn Troy of the Conference Board, a business research group in New York, suggests that it might be too early to tell:
''If anything happens in the way of a falloff in corporate giving, it won't happen until (after the end of) 1983 or 1984.'' This, she says, reflects the long lead times of corporate budgetmaking.
Giving to the arts and to cultural activities has risen as a proportion of total corporate giving over the past several years, as these figures from the Conference Board indicate:
In 1975 - 7.5 percent - $33 million.
In 1976 - 8.2 percent - $42.2 million.
In 1977 - 9 percent - $53 million.
In 1978 - 10.1 percent - $70 million.
In 1979 - 9.9 percent - $82.5 million.
In 1980 - 10.9 percent - $108.7 million.
In 1981 - 11.9 percent - $140 million.
The figures are not an absolutely strict apples-to-apples comparison, since the list of corporations surveyed varied at least slightly from one year to the next.
And more important, these figures reflect only giving from specifically designated philanthropy budgets. A great deal of corporate giving to the arts actually comes out of advertising budgets.
''It doesn't make a lot of difference for a corporation our size whether it comes out of our advertising budget or our philanthropy budget,'' says Richard G. Mund, secretary and executive director of the Mobil Foundation. ''If it's philanthropy, it's deductible. And if it's advertising, that's a business expense, and that's deductible, too.''
The important thing, as far as the tax code goes, he says ''is that a grant with significant public relations value for the corporate donor be honestly classified as an advertising expense.''
Kathryn Troy of the Conference Board ascribes the increase in corporate generosity over the past several years to ''a feeling that other social concerns had been pretty well taken care of - though of course that has changed a lot lately. The arts are something noncontroversial, and companies are very much concerned with the quality of life.''
She echoes the widely prevalent view that businesses, mostly in newer industries, are coming to consider access to symphony orchestras, museums, etc., as important as schools and housing costs in decisions about siting plants and in keeping employees happy.
''Another factor,'' Ms. Troy adds, ''is that the two endowments, the National Endowment for the Arts and the National Endowment for the Humanities, have been making 'challenge grants' in various communities around the country, and so local businesses have come under pressure to match those federal dollars.''
Charles L. Griswold, president of Alcoa Foundation, in Pittsburgh, says his foundation's arts contributions, generally running from 10 to 12 percent of total giving, fluctuate from year to year because of the nature of big projects in the arts.
Says Mr. Griswold: ''For three years there, we sponsored 'Previn and the Pittsburgh' on PBS, and that was a big project. That made our arts participation very high. After that we thought we needed a bit of a vacation. And so our funding was really high for a while and then fell off a bit.
''I don't mean to suggest that we fund only extravaganzas, though. We really do support a broad range of arts groups.''
Alcoa Foundation, with its $175 million endowment, is fully funded, Mr. Griswold says, meaning that its grantmaking capacity is not dependent on current earnings of the parent company, the Aluminum Company of America Inc. This helps smooth out the recessionary curves that are seen to have affected corporate giving over the years.
Setting up their own foundations is becoming an attractive option for many companies interested in evening out their contributions through the business cycle.