Nonprofits may struggle to secure unrestricted funding from corporate partners under EU CSRD, research indicates
Melanie May | 16 September 2024 | News
The EU Corporate Sustainability Reporting Directive (CSRD) will impact how companies and their nonprofit partners collaborate when it comes into effect in 2025, according to this year’s edition of the annual C&E Corporate – Non-Profit Barometer.
Based on a survey of professionals from over 120 UK and global businesses and nonprofit organisations (NPOs), the report highlights the current motivations, changing practices, barriers and challenges for partnership between organisations in these sectors.
The Barometer, which was co-authored for the first time by generative AI, found that a significant majority of respondents (87%) believe it either highly likely or likely that companies will require NPOs and charities to provide detailed information about the latter’s own social and environmental practices.
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However, views differ between companies and NPOs when it comes to expectations of how and the types of funding businesses are likely to provide to their nonprofit partners in the era of the CSRD. 80% of business respondents think it unlikely or highly unlikely that companies will provide unrestricted funding (referred to as unearmarked funding in the report) to nonprofit partners or charities. At the same time, over half (56%) of nonprofit respondents expect that companies will provide unrestricted funds to them.
Commenting on these findings, Manny Amadi, CEO of C&E Advisory, said:
“New data clearly shows that it may be an uphill struggle for nonprofits to secure non-earmarked funding from their corporate partners in the era of the Corporate Sustainable Reporting Directive which will come into effect in 2025. It is concerning that a notable gap exists between businesses and their nonprofit partners on each party’s expectation of the role of earmarked or non-earmarked funding.
“Nonprofits and charities should therefore either focus on making the business case and providing evidence as to why the provision of non-earmarked funding can yield greater social and environmental value, or alternatively, better manage their own expectations.”
Most admired partnerships
As in previous years, the 2024 Barometer asked corporate and nonprofit respondents to identify their most admired corporate-non-profit partnerships. In an open poll the top two spots were consistent with 2023 results.
For the second year running, the Tesco, Cancer Research UK, British Heart Foundation, and Diabetes UK health-based partnership was the most admired by partnership professionals. Launched in 2018, the collaboration between Tesco and its charity partners has delivered health insights and interventions relating to cancer, heart and circulatory diseases, and type 2 diabetes and raised over £29mn for the charities.
Once again, the runner-up was the Boots UK–Macmillan Cancer Support partnership, which has figured consistently highly in the Barometer’s rankings for over a decade, placing second behind Tesco for the last three years. In joint third place are Greene King-Macmillan Cancer Support and Network Rail-Samaritans partnerships. Macmillan Cancer Support was named most admired NPO or charity, receiving 21.9% of the vote.
Commenting on these findings Christine Heffernan, Group Communications Director at Tesco, said:
“We’re incredibly proud to work with the UK’s leading health charities on making a difference to the health of our customers and colleagues. It is testament to the strength of the partnership that we have been recognised two years in a row by the C&E Barometer for our work with long-standing partners, British Heart Foundation, Cancer Research UK and Diabetes UK who share our ambition to make a positive contribution to the communities we serve. I’d like to thank them for their ongoing support as we continue to help our customers and colleagues to live healthier.”
Cancer Research UK’s Chief Executive Michelle Mitchell said:
“Through our partnership with Tesco, the British Heart Foundation and Diabetes UK, we’ve been able to combine our expertise to tackle the nation’s biggest health challenges. Together, we’ve empowered communities to lead healthier lives by sharing information and support about cancer, heart and circulatory diseases and type 2 diabetes. This award is a testament to the important work that we’ve done and is only made possible thanks to the support provided by Tesco.”
Generative AI’s role in partnerships
This year’s Barometer also looks at the use of AI in cross-sector partnering. It found that businesses and nonprofits both feel that AI will play an important role in partnerships in the future – particularly in relation to reporting and research. However, only a third (33%) of businesses and nonprofits expect to deploy AI in their relationships in the next 12 months. The Barometer says that while this indicates a higher take up than was predicted for the previous 12-month period (a prediction of 20%), the figures indicate more of an incremental than radical transition to the use of AI in the delivery of corporate – nonprofit partnership objectives.
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.