Donations from FTSE 100 companies not keeping track with profits, CAF research finds
Melanie May | 16 September 2024 | News
FTSE 100 companies donated £1.82 billion last year, slightly down on the previous year, according to Charities Aid Foundation’s latest Corporate Giving report.
With £1.85 billion recorded in 2022, in real terms this difference equates to an estimated £164 million of lost charitable contributions.
CAF’s Corporate Giving 2024 report also shows that charitable giving by FTSE 100 companies over the past ten years has not kept pace with profits. While the FTSE 100’s combined profits have increased by 49% since 2014, total donations declined by 13% in the same period – a 34% decline in real terms.
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On average, the FTSE 100 donate an average of 0.9% of their pre-tax profits, compared to 0.4% for wider businesses, although CAF notes that there is wide variation between the companies on the index.
Potential extra £5bn for charities from businesses
Overall, CAF estimates that the UK business sector contributes around £4.29 billion in total to charities. However, it also estimates that if all companies gave at least 1% of their pre-tax profits, this could rise to £9.9 billion in donations for charities.
At the moment though, it found that only one in five companies intends to increase their giving next year (19% of FTSE 100 and 20% of wider businesses).
Neil Heslop, Chief Executive, Charities Aid Foundation (CAF) said:
“As the largest listed companies, FTSE 100 businesses can lead and drive a responsible corporate culture throughout the UK’s business sector. Donating at least one percent of pre-tax profits should be the starting point, demonstrating a commitment to social purpose and delivering positive impact for both people and planet.
“The Government has a crucial role to play too. A national strategy for philanthropy and charitable giving would help to renew a culture of giving throughout society, unlock vital charitable funds and ensure these reach the causes and areas that need it most.
“Our experience tells us that when charities, the private sector and government all play their part, we can work towards building a resilient and thriving civil society for the future.”
Top givers
CAF’s report looks at how much individual FTSE 100 companies contribute to charity by the outright sum donated and that sum as a percentage of pre-tax profits. It found that GSK topped the list for total sum given to charity for the second time, donating £304 million. GSK’s donations account for nearly a sixth of the FTSE 100’s total charitable giving. Tesco however gave the highest percentage of pre-tax profits, donating equivalent to 11.9% last year. It was also the highest climber in both rankings, increasing its total donations by £30 million.
About Melanie May
Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via thepurplepim.com.