What Should Corporate Philanthropy Look Like in 2025?

Steve Odland: Welcome to C-Suite Perspectives, a signature series by The Conference Board. I'm Steve Odland from The Conference Board and the host of this podcast series.  

And in today's discussion, we're going to talk about corporate philanthropy. Does it result in meaningful, lasting social impact? What is it? Why do people do it? And joining me today, an expert on corporate philanthropy, is Jeff Hoffman, who's the interim ESG Center leader here at The Conference Board and formerly an executive with Disney.  

Jeff, welcome.  

Jeff Hoffman: Hello, Steve. Happy to be here with you today. 

Steve Odland:I'm so happy that you're here. And this whole area of, we said corporate philanthropy, but it's really under a broader umbrella of CSR, corporate social responsibility, corporate citizenship, corporate philanthropy. These are all kind of interchangeable terms, but can you help us ground us in those terms to begin with, and what means what here? 

Jeff Hoffman: Good. Your guess is as good as mine. I'm actually kidding on that. But it is .a challenge. So many of the roles and titles within corporations are very clear. If you're the chief communications officer, you know what that role is. If you're the chief human resources officer, you know what that role is. 

But with corporate social responsibility, corporate citizenship, philanthropy, social impact, community relations, it goes on and on, different companies define it in different ways. But as you introduce us with corporate philanthropy, I think that'sprobably the clearest. It's our root.  

The Conference Board has been involved with corporate philanthropy and helping companies since 1943, during World War II. And it has broadened since then, basically, to symbolize the work that the company does in society, whether it be in the communities where its employees live and work, where the operations are, but really how it works to create a better surrounding, a better neighborhood, for those in the areas it serves. 

Steve Odland:Yeah. It'sessentially, when you think of these roles in companies, and you mentioned that they're all sort of different titles, they're all external-facing, right?  

Jeff Hoffman: Correct.  

Steve Odland: And so if you think about the multiple constituency world—customers, employees, owners, community environment—it's not the chief customer role, it's not the chief employee role, it's not the chief owner role, but it's really the chief external-facing role as it relates to community and the environment, essentially.  

Jeff Hoffman: Correct. Yeah.  

Steve Odland: And so how do these people think about the strategy of the corporation—and every industry and corporation is different and has a different customer focus and so forth. How do you think about that strategy versus your external CSR strategy?  

Jeff Hoffman:Yeah. It's a good question. And most, and I will say most, companies today tend to align their community strategy with their business strategy, which often ties into what their products are, their goods and services, what are their core competencies. Philanthropy is so much more than just writing a check to a nonprofit or a charity. It's how you bring the whole company into the community to help be a problem solver. 

If you look at, you mentioned my 30 years at Disney, just in the simplest term, the core ideas for Disney are families, and it's about bringing families together and having magical experiences. But using that core competency to help children in need, and sometimes, these are sick children with horrible diseases that they are fighting. How can Disney help put a smile on a child's face, which actually ties into the psychosocial aspect of healing?  

And you can look at that with just about any type of company. What can they bring to the table? I think of one of our members who is in the insurance business, and the stability and the work that they're doing around intergenerational wealth in communities and insurance and life insurance. And this particular piece can be a part of that. Something that they have the expertise to do that other companies don't. You're most effective, I think, when you actually do align your community work with your business strategy and values.  

Steve Odland: Now, some companies have people on staff that are somewhere in the business, somewhere in the organization. Others have a separate 501(c)(3) foundation that they've set up to manage this. Do you have a point of view on best practices there?  

Jeff Hoffman: Yeah, I do. Foundations, corporate foundations, were established in the '50s, when there was a change in regulations about for-profit companies being able to give profits away.  

Long story—I will save you that—but a good portion of companies today, even that have foundations, primarily do their giving through corporate dollars. It gives you a lot more flexibility out in the world, especially if you want to tie your giving to actual company initiatives. There's something called self-dealing that those with foundations have to worry about to ensure that anything that they're doing through the foundation does not inure benefit back to the company itself.  

So to avoid that, using corporate dollars gives you more flexibility with what I was talking about—how you can combine your core competency with those giving dollars and then plus your employee volunteering. Versus if it comes through the foundation, you have to have an arm's length distance from the company on how you talk about it, which can be a challenge, depending on what solutions you're working to solve in the community.  

Steve Odland:Yeah. So you really start with, it sounds like, with the corporate strategy in mind.  

Jeff Hoffman: Yes.  

Steve Odland: And then link that and interweave that into your community approach. Now, what trends, you mentioned a couple, but what other trends do you see here in 2025 for corporate philanthropy?  

Jeff Hoffman: I think the big thing is, The Conference Board overall does the C-Suite Outlook every year. And at the very end of the year in our corporate citizenship work with our members and CSR executives, we do a pulse check on what they're seeing, both in society and in the business of what the year ahead is going to look like.  

And interestingly the two matched as far as the question of, what social areas does the company plan to focus on in the coming year? And one was economic opportunity, and the other was education. So when you talk about that alignment, I'm always very pleased to see when these two things are aligning versus being divergent.  

Steve Odland:Yeah. And this kind of comes under the headline, sometimes, of DEI, which is diversity, equity, and inclusion, because some of the corporate philanthropy is focused on areas that are linked to a company's DEI strategy. Now there's been a huge amount of recent DEI pushback. How is that impacting corporate philanthropy?  

Jeff Hoffman: Quite a bit, because even though, in the simplest terms, DE&I tends to be focused more internally and corporate citizenship externally, there is a crossover area. And then you do have the employee volunteering piece. And sometimes how, within the ?DE&I space, the employee resource groups, oftentimes as groups, will go volunteer in the community based on what the subject matter is or the focus of that employee resource group. So there is some crossover area.  

I think when we take the buzzwords out, and this is where I think focusing on the economic opportunity, of which education is a piece, along with a lot of other components to it, is a way to take the buzzwords out and really to continue to focus and help in the communities where you operate in and where your employees live in. The makeup of those communities is all different. So basically, we're helping to float all boats at this point. So it is still, in the long run, helping those who need it most without targeting a specific group.  

Steve Odland:Yeah, now there's also been geographic shifts, I think. The rule of thumb for a long time has been that the majority of corporate giving should be in the community where the headquarters is or where the predominance of employees are. Then it shifted for a while to be a distributed approach to try to hit as many communities as possible, wherever people have manufacturing plants or any kind of a presence. 

But, as companies get bigger, it's really hard to sprinkle that and get any kind of impact. What are the current trends on this?  

Jeff Hoffman: Do less, not necessarily resource-wise, but instead of a scattershot approach to organizations in a community, even in your corporate headquarters, what are the organizations that you, because of your core competencies, can help make the biggest impact on?  

And then, that's in headquarters where you have major operations. I think where it gets challenging is when you are a major multinational corporation, you have employees spread out all over the world. You might have tens of thousands of people in certain centralized spots. But then you might have an office in, pick a country, with five people in it. Obviously, you aren't going to have a full-time staff person focusing on the community when you only have five people in the entire country. And this is where the employee volunteerism piece can come in in volunteering grants. So basically, then it is supporting those employees in the work in the community where normally you would not have a presence.  

The other piece I want to mention on what you said, and this is also a challenge because, if you look at the stakeholders that you mentioned—obviously, the employees are huge in the communities, the consumer—is how do you demonstrate that you're a good corporate citizenship to the consumer where you actually have zero operating presence in the area where those consumers are?  

And that's where some of the national and the global initiatives that might have very physical execution in areas where you have a lot of employees, but yet, because of a national relationship with an organization—take Boys and Girls Clubs of America, for instance—you can still demonstrate that you are caring, even though you might not be supporting a specific club in the neighborhood where you have customers.  

Steve Odland:We're hearing that a lot of companies are pivoting on their corporate philanthropy in this environment. You can't disaggregate the social environment from the political environment. The Conference Board is totally nonpolitical, nonpartisan, of course. But we are, in this country, we're a divided country, roughly half and half in terms of our views. We've just gone through an election, and you've got a lot of change happening.  

How do you see companies reacting to this sort of changed environment as it relates to their corporate philanthropy?  

Jeff Hoffman:It's a tough one, Steve. That's where, a lot of your podcasts and what we're seeing come out of The Conference Board, is staying true to your values, but at the same time, being pragmatic with what's happening on the world and knowing that you do have various stakeholders that you need to address their issues and concerns. 

And I think that's where, whether it's going back to say, something such as economic opportunity, is how you go about doing things in the communities that would be more central or less controversial in this divided world. And there are certainly ways of doing it where you're staying true to who you are. But yet, knowing that there are issues that, if you do this particular issue, you're going to have people against you or vice versa. And I don't think we want to get to the point where people are thinking of companies as a Red company or a Blue company versus a company that is providing goods and services for everyone. 

Again, I think if you stay to your core competency and the work that you do through your philanthropy, it will help guide you to stay away from the areas on either side that could be viewed as controversial.  

Steve Odland:Yeah. So I think, the watchword here is caution, and be aware of what's happening in the external environment, and make sure that your strategies are constantly updated and consistent with your core values of your organization, but not inconsistent with what's happening out there.  

Jeff Hoffman: Yep. Yep. Absolutely.  

Steve Odland:Yeah. We're talking about corporate philanthropy in 2025. We're going to take a short break and be right back.  

Welcome back to C-Suite Perspectives. I'm your host, Steve Odland, from The Conference Board, and I'm joined today by Jeff Hoffman, who is the interim ESG leader at The Conference Board. You're an interim leader here, but you've been a leader in corporate philanthropy and citizenship for decades and decades, Jeff, so no better expert to talk about this kind of stuff. 

Now, we were talking about pivoting in the new year to stay to your values, stay true to your corporate strategies, but also, be aware of the external environment. What do you see as the most impactful emerging approaches for driving societal impact in 2025? 

Jeff Hoffman: AI. We talk a lot about AI. There are exciting opportunities for companies. We often look at AI. It can also be a scary new tool. But let me give you a couple of examples where AI are helping companies to be smarter about their giving.  

Credit card companies, for instance. Credit card companies, they have a lot of data. And when you aggregate that, so you're taking away, putting aside any concerns on privacy, they know who is buying what, where. And what we're finding is again, when we talk about economic opportunity, food security is certainly one of the pillars in that. You can tell where people are buying food and how far away it is from where they live. 

So you can actually determine, using AI and going through all of the data, determine what we call food deserts. And this provides an opportunity, whether is, oh, we have food banks that are next to supermarkets—not saying that they don't, they're still serving a need—versus putting a food bank in what is a food desert. Or is there an opportunity for a supermarket chain to actually go in and establish in that community and meet a need? And then it goes to the economic opportunity aspect, too, because it's providing goods and services to where the consumer is in areas that, sometimes, companies might not have thought as viable customers from a spend perspective. 

So that's just one example. With AI, we've also seen it in things such as prenatal care and care with infants, as far as areas where things that often you might take for granted. For the mother, as soon as the mother's given birth and what the new infant needs, you're seeing where those products are not being purchased. Or even, in a regional area, and then when you look at it from a health standpoint, it's OK, in order to ensure that these infants are going to grow into being healthy toddlers, children, and then adults, this is an area that needs to be addressed. 

So I think that's just two examples right now of how AI—often, companies have lots of data to address certain issues. And one of the big things that we talk about these days is, obviously, we talk about money, we talk about giving product, and all of that. But the other thing is, how do you donate aggregated data to help address issues that are out there—again, making sure, we're all concerned about privacy, that we do this through a privacy lens. 

Steve Odland:It's interesting because some companies believe that their philanthropy needs to be direct to the end user, the end consumer, the end need. Others say no, you should really go through intermediaries, 501(c)(3s), not for profits who are closer to the need and the community and the expertise. 

And part of the reason for that was that they didn't really have a great way to get to and manage down to the end need. But what I hear you saying is, with AI there, that might be an easier task now. But do you have a point of view on that, going direct versus going through intermediaries? 

Jeff Hoffman: I do, and it's because of taxes. If you give to a ?501(c)(3) nonprofit, one, it's a tax deduction for the company. But if you give directly to individuals, one, you aren't getting a tax deduction for it. It may or may not be a business expense, depending on how you look at it. But for the individual receiving it, there are tax implications for that, and it can be viewed as income by the IRS. 

And probably the best example that we often hear about is when there are disasters. And is the disaster declared by the president as a national disaster? Or sadly, does your house burn down in the middle of the street, not part of a bigger disaster situation? Not to say that we want to see the big fires that happen out there or other disasters.  

But yet, when it's a federal disaster, you can give aid directly to an individual without that tax implication versus, sadly, if your house just burns down on its own, you better be going through an intermediary organization, or you're going to be paying taxes on that gift that you receive from a company. 

Steve Odland: OK, so it sounds like it still is the right way to go, even with AI, through these not for profits. But that means that you really need to be thinking through partnerships rather than waiting until something happens and then trying to ring up a not for profit, correct?  

Jeff Hoffman:Yeah. And there are really good organizations out there. In fact, one of the organizations we're partnering with for the upcoming Corporate Responsibility Summit, that's what they do, not only in the United States, but they do this around the world. And they are experimenting more with the direct payment option, which is interesting.  

Steve Odland: Tell us more about that. 

Jeff Hoffman: There's a thought that when you're trying to lift up someone, and this goes back to the economic opportunity aspect, that because of Maslow's hierarchy and the things that you just need to survive on your daily life, if there is a certain amount of cushion that you're able to give somebody when a crisis occurs, it lowers the stress level by providing food, potentially shelter. Or some other necessities in order to then go out and spend more time on trying to find a job to put yourself back on your feet. 

And this is one of those chicken-and-the-egg situations in child care, and obviously, our CED group talks a lot about child care issues and the economy. But if you can help somebody get back on their feet by paying for child care before they have a job that gives them an opportunity to go look for a job, then after a crisis hits, they're going to be more successful. 

Soit's a mind shift on how you help individuals to get them back on their feet. It could be because of a job loss, it could be because of a natural disaster or something else that is occurring.  

Steve Odland: We talked earlier about the shifting political landscape. Do you see companies changing their messaging in citizenship as a result of that? And/or do you advise companies to change?  

Jeff Hoffman: Yes, it's a big conversation that companies have been having since the inauguration and the executive orders, and frankly, who are the customers of the companies. There are a lot of companies out there that are federal contractors, and there are a lot that aren't federal contractors. 

And there are certain things that, if you're a federal contractor, you must do, where it's a choice for a company that isn't. And wording is certainly a part of that and how you talk about your programs, but it's not even just the words because we were talking about AI and how you can use AI to actually look at websites and see certain words that companies might be using.It's really about the programs themselves and who you'rehelping out there. And oftentimes, it's those marginalized communities who are the ones that you're going to help, whether you call it out or not, because those are the ones who are in need in a particular community that you'reworking. 

Steve Odland:Yeah. So just wrapping up then, any other advice that you have in this whole area of philanthropy for 2025?  

Jeff Hoffman: I think probably one of the biggest things that we continue to struggle with is impact measurement because, many people have said, if you can't measure it, why are you doing it? But at the same time, sometimes our inputs into society are collective. We're doing this with other partners out there. So it can be very difficult to say, "By us giving a grant of X, it is enabling this many children to read at grade level," because parents are involved, teachers are involved, after-school programs are involved besides a program that, say, a company is helping specifically to get that child to read.  

So that is an issue we're always grappling with. And I think what we're getting closer is deciding, at the end of the day, what can we take credit for? And what can we say that we were part of a collective effort to do? SoI think we have—well, I don't want to say we have clarity yet, but we're getting closer.  

But the other part is return on investment to the company. We're really looking at the ROI, whether it be the recruitment and retention issues, the brand equity piece that is attributed to being a good corporate citizen. And the term that some people like, some people don't like, on social license to operate and how, If you're a good neighbor, and you invest in a community more likely to be able to expand your plant or build a new building in a location that might not necessarily want the additional density traffic, et cetera. But if you can demonstrate, no, they'rea good neighbor, they're really involved in the community, the employees volunteer we, we want them to be there.  

So these all have bottom-line benefits to the company, and we're spending more time on, we've identified most of what these are, but we're trying to figure out how can we actually calculate that value. 

Steve Odland: Lots of great advice, Jeff, as always. Thanks for being with us today. Jeff Hoffman.  

Jeff Hoffman: Thanks, Steve. Happy to be here.  

Steve Odland: And thanks to all of you for listening to C-Suite Perspectives. I'm Steve Odland, and this series has been brought to you by The Conference Board.