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Laura Dosanjh

Senior Advisor
Charities Aid Foundation

T: +44 (0)3000 123 298

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From philanthropy to purpose: Key corporate responsibility trends in financial services

Autumn 2016

Financial services have a proud tradition of philanthropy. Over the years the industry has been an important source of private sector funding for the charity sector and has also increasingly used its investor mindset to innovate within the field of corporate responsibility and support social change. Initiatives range from investing in social mobility programmes and funding research to supporting social enterprise and the wider development of a thriving civil society. 

Taking the long view, famous names like George Peabody, whose housing estates are a familiar feature of London, and Angela Burdett-Coutts, who founded the forerunner to the NSPCC, demonstrate how the Financial Services industry has helped drive some of the most sustainable social innovations. 

With the changes faced by the industry in 2008 and, more recently, the general uncertainty surrounding outcome of the Brexit vote in the UK, we are starting to see renewed calls for a more authentic and strategic social purpose in financial services. This adds to pressures in recent years to build trust and confidence in the sector, as well as the need to attract and retain talent from a generation that have higher expectations and are seeking more purpose in their increasingly demanding and varied careers.

We work with a wide range of FTSE 100 and other corporate clients, bridging the gap between donors and causes, and helping companies to design and implement strategies for greater social and commercial impact. Through our research and work with clients we have observed general trends in the sector that have developed as a result of these external and internal pressures. These trends pose particular challenges and opportunities for our clients in financial services.

A more integrated approach

Our 2016 report into giving among FTSE 100 companies showed that the finance sector as a whole continued to be a major donor. It was the fourth most generous industry in terms of the proportion of revenue it donated to charity. 

However, this masks a wide variation in absolute giving levels as well as giving as a percentage of revenues. Overall in financial services we have seen the percentage of revenues given fall between 2012 and 2014 (see graph) and an increasing emphasis to give in-kind (such as skills, time and wider business assets).

Revenues and donations by FTSE 100 financial services companies, 2009-14

Revenues and donations by FTSE 100 financial services companies, 2009-14

Shift to a longer term focus

All this appears to be evidence of a shift in the sector away from corporate giving to a more integrated approach – in effect away from philanthropy and towards social purpose. Taking a closer look, our own analysis of leading UK finance companies’ latest sustainability and corporate responsibility statements indicates three interesting trends:

1. A longer term focus – focusing on growth, building future markets, new customer bases and new sources value;

2. Greater alignment of corporate responsibility and business strategy – going beyond philanthropy to a broader notion of integrated purpose and implying a wider commitment from the business and its intellectual, financial and intangible assets to creating “shared value” for business and society; and

3. A thematic focus on future social needs – typically focusing on disadvantage, youth, social mobility and building social capital.

These are general directions, and companies will naturally seek an approach to corporate responsibility strategy that best reflects their strategic purpose.

Challenges and opportunities ahead

There is still an important role for financial services in bringing their investment mindset as well as patient capital to stimulate and help scale innovation in the wider economy, focusing on both commercial and social sectors. 

Increasingly though, financial services companies are demanding more of their scarce philanthropy resources, seeking a greater return on investment for the business as well as society. And so we expect to see greater scrutiny of corporate responsibility investments, more critical evaluations, more collaboration and co-investment and a wider definition of philanthropy, which values the social as well as financial capital that businesses can bring.

We think there will always be an expectation on financial services to act philanthropically and strengthen civil society both as a champion and a provider of unrestricted funding to enable financial flexibility and risk taking. However we think there is also huge potential to use the concept of purpose to explore a wider definition of the role of business in driving social change.


I'd love to hear your thoughts on this blog.  For more information or an informal discussion on how we can help advise and support your company please contact me.