Falling profits force corporations to cut back charitable giving

Exxon Corporation cut its corporate giving by more than $10 million. Mobil lopped almost $1 million from its foundation's spending. And, WR Grace, losing money in its fertilizer business, has sliced its giving by 20 percent. This is a difficult year for corporate charitable giving. In a new survey of 439 companies, the Conference Board, a private research organization in New York, estimates that company giving will fall this year by about 2.5 percent (see chart).

The Board found that nearly 50 percent of the firms giving more than $10 million planned to cut back this year. Between 1976 and 1985 total contributions tripled from $1.5 billion to $4.4 billion.

The corporate cutback, says Linda Cardillo Platzer, a corporate contributions specialist at the Board, does not reflect an attitudinal shift by companies. Rather, she says, ``It's a reaction to the economic situation more than anything else.''

Mergers have likewise pared corporate giving. ``When companies are merged, their giving is not the sum of the two programs before the merger,'' says Ms. Platzer.

This has been the case for the oil companies, which have been significant contributors. The Board found oil companies cut their spending by 15 percent this year.

At Exxon, a spokesman says charitable contributions fell because of the ``uncertainties surrounding the oil industry.'' Mobil considers most of its giving, such as to Masterpiece Theatre, an expense. It does not release information on its expenses.

It was also a difficult year for metals and mining companies which reduced their charitable grants by 7 percent. At Bethlehem Steel, a spokesman says spending has fallen ``by a whopping amount'' over the past few years, including 1986. In the past Bethlehem has spent money on education and other health and human services. Now, it only contributes to the United Way, volunteer fire departments, and emergency medical facilities. ``We've had losses for four years in a row,'' says the Bethlehem spokesman.

General Motors traditionally has been a large giver, doling out $91.2 million in 1985. A GM spokesman says, however, contributions fell this year to about $50 million, in large part because last year's numbers were inflated by the value of property given to community groups when GM closed plants.

And, General Electric, another major contributor, expects its giving this year to be $36 million, only 1 percent higher than last year. Paul Ostergard, president of the GE Foundation, notes that GE's giving grew nearly 200 percent between 1981-85. This year, Mr. Ostergard says, ``We needed some time to revamp from top to bottom.''

GE, which merged with RCA this year, says it will honor all of RCA's multi-year commitments and will continue the RCA scholarship program and gift-matching plan. It still has to decide what to do when both companies have been sponsoring the same program, however.

Not all companies have cut back. At GTE, for example, giving is up 6 percent this year over last year, slightly more than other companies in its industry. Ann Robin, director of corporate contributions, says the company's goal has been to give 1 percent of domestic pretax income. Since GTE's earnings have been rising, it can do this.