Benefits, Corporate Motives, and Communication Patterns in Strategic Philanthropic Relationships as Perceived by Nonprofit Partners

Businesses are increasingly held accountable both to their owners and to the larger society in which they operate. Accordingly, many companies are extending their resources to meet community needs through philanthropic partnerships with nonprofit organizations. Such ventures, however, have drawn close scrutiny of motives and benefits. For example, some consumers register skepticism when evaluating the sincerity of corporate intent in cause-related marketing arrangements. Attribution theory suggests that altruistic reasons for corporate good deeds may be discounted in the context of apparent self-interest. Likewise, a debate between shareholder and stakeholder theorists introduces questions about possibly conflicting obligations facing corporate managers. Some contend that good business and stakeholder accommodation do not mix. The emergence of strategic philanthropy potentially serves both interests, but little empirical study has been devoted to understanding the dynamics of such partnerships. Of particular interest is the perspective of nonprofit organizations who receive strategically motivated corporate gifts.

This study used a grounded theory approach to tap the perceptions of nonprofit managers regarding these issues. Through in-depth interviews, the researcher learned that nonprofits commonly see in their partners a pattern of multiple corporate motives, with varying blends of altruism and self-interest. The largest donations were generally reported from companies expecting marketing benefits in return for their philanthropic investment. However, participants stressed that those expectations most often were unstated by the company. They described a negotiating environment in which nonprofits thoughtfully analyze potential corporate donors’ needs and then pitch mutual-benefit packages to engage them in partnership. In the most strategically driven alliances, relationships were characterized as interdependent, and benefits were viewed as approximately equal. Nonprofit managers reported that they work hard under the strategic model to obtain corporate gifts, but they also experience deeper, more satisfying relationships with their partners than in the past. Communal qualities were often described. In some partnerships, corporate motives were seen as evolving from a primarily marketing interest to an increasingly altruistic interest in the nonprofit mission.

Theoretical implications and a proposed model are presented to guide further study. Observations and recommendations for corporate managers are also offered.