Small and Midsize Companies Contribute More of Total Arts Giving than Large Businesses
Thursday, June 20, 2013
WASHINGTON, D.C. — Business support for the arts was up between 2009 and 2012, with cash plus non-cash giving increasing 18 percent according to a new survey by the Business Committee for the Arts (BCA), a division of Americans for the Arts, the nation’s leading nonprofit organization for advancing the arts.
The BCA National Survey of Business Support for the Arts shows that business support has climbed back to 2006 levels, which is not surprising given the improvement in the country’s economy from 2009 to 2012. This upward giving trend looks likely to continue as 17 percent of businesses that support the arts expect to increase giving in 2013, while 69 percent expect giving to remain flat.
The BCA National Survey of Business Support for the Arts report examined the giving habits of 600 small, midsize, and large* U.S. companies that gave philanthropically between 2009 to 2012. Of those businesses included in the BCA study, the percentage of giving to any philanthropic cause is up from 52 percent in 2009 to 64 percent in 2012. In addition, the percentage the arts received of total philanthropic contributions increased from 15 percent in 2009 to 19 percent in 2012. There was also a significant increase in the median gift size from large businesses from $15,500 in 2009 to $30,000 in 2012.
"It is rewarding that the private sector regained such strong support for the arts during the turbulent economic climate of the past few years," says Robert L. Lynch, president and CEO of Americans for the Arts. "Building successful partnerships between the arts and business communities benefits everyone involved and just makes good sense."
There is still a strong need to make the case for how partnering with the arts can benefit business. Seventy-three percent of businesses that support the arts consider the arts a moderate to very low priority. To ensure more businesses understand the value of partnering with the arts, Americans for the Arts launched the pARTnership Movement in January 2012.
The initiative demonstrates how the arts can help businesses achieve their goals by enhancing the critical thinking, team building and creative skills of the corporate workforce while also enhancing the ability of communities to attract and retain employees. In addition, the pARTnership Movement also prepares arts organizations to better partner with businesses in new and innovative ways.
Small and Midsize Business Support for the Arts Grows
Unlike most business philanthropy studies, the BCA report examines the giving habits of small- and medium-size businesses as well as large ones. The majority of business support for the arts continues to be locally directed and from small and midsize businesses: 82 percent of the support for the arts comes from businesses with less than $50 million in revenue. Perhaps surprisingly, almost half of the overall support (47 percent) comes from the millions of businesses with less than $1 million in revenue. Ninety-six percent of business support is directed to local arts projects with less than one percent directed internationally.
In addition to monetary support, the BCA survey also examined the in-kind contributions (non-cash donations) that businesses provide to arts organizations. It found that from 2009-2012, the number of small companies giving in-kind donations to arts organizations decreased slightly from 60 percent to 56 percent. However, there was an increase of non-cash contributions by large businesses to 53 percent in 2012, compared to 46 percent just three years prior. In-kind giving among midsize companies remained relatively steady at 59 percent.
"While large businesses increasingly operate in a global marketplace, most businesses—particularly small businesses—remain highly focused on local markets," says Dr. Mark Shugoll, BCA Executive Board member and CEO of Shugoll Research. "Arts organizations have a natural opportunity to build partnerships with these companies by providing innovative programs serving broad community audiences."
Philanthropic Support for Arts Tied to Companies’ Bottom Line
According to the BCA National Survey of Business Support for the Arts report, there are a number of key reasons why businesses support the arts: 54 percent support the arts because they improve the quality of life of the community, 47 percent because of education initiatives that benefit the community, and 47 percent because of the ways the arts improve student academic performance. The study also reinforces previous findings about the positive effects of the arts on the workforce. About four in ten survey respondents strongly agree that the arts can stimulate creative thinking and problem solving (44 percent), offer networking opportunities and the potential to develop new business and build market share (39 percent), and enhance acceptance of diversity in the workplace (37 percent).
Increasingly arts funding is coming from marketing and advertising budgets and less from contributions budget. The number of businesses who said they gave from their advertising budgets increased from 39 percent in 2009 to 45 percent in 2012. Similarly, the amount of businesses who gave from their marketing/sponsorship budgets increased from 38 percent in 2009 to 44 percent in 2012. However, businesses giving from their annual contributions budgets decreased from 39 percent in 2009 to 32 percent in 2012.
"In recent years, business support of the arts has shifted from general charitable giving to a more marketing-based and sponsorship-oriented strategy, enabling businesses to support the arts as well as use the arts to meet their business goals," says Bobby Tudor, CEO, Tudor, Pickering, Holt & Co. and BCA Executive Board member. "By tying a company’s arts giving to their bottom line, arts organizations have a unique opportunity to make a solid case for charitable support."
In addition to including information on small and medium sized companies, this study sets itself apart from other corporate philanthropy studies by interviewing businesses that do not make arts contributions. While financial constraints was the top category (57 percent), half of the respondents indicated a preference towards education and social services (50 percent). This suggests an opportunity for arts organizations to increase awareness of research demonstrating the social, educational, and economic benefits of investing in the arts.
Another strategy that the data suggest: Ask. Surprisingly, 66 percent of businesses who did not support the arts were never asked.
To learn more about the survey, Americans for the Arts will be hosting a webinar on July 18, 2013 at 3:00 p.m. EST. In this discussion led by Shugoll, participants will learn about trends in business support for the arts from the newly released BCA National Survey of Business Support for the Arts. Experts in corporate giving from CECP will also discuss how these trends fit into the current landscape and how you can leverage this information. To register, visit bit.ly/11Rewr9.
To view the BCA Survey, visit http://www.partnershipmovement.org/news/p/the-2013-bca-national-survey-of-business-support-for-the-arts/.
*For the purposes of analysis, the businesses were divided into three revenue size groups: under $1 million (small), between $1 million and less than $50 million (midsize), and $50 million and over (large).
Americans for the Arts is the leading nonprofit organization for advancing the arts in America. With offices in Washington, D.C. and New York City, it has a record of over 50 years of service. Americans for the Arts is dedicated to representing and serving local communities and creating opportunities for every American to participate in and appreciate all forms of the arts. Additional information is available at www.AmericansForTheArts.org.