Corporate philanthropy has seen a sharp decline in the past few years. This is a huge problem considering that the demand for corporate responsibility and involvement in philanthropy. The Advantage of Corporate PhilanthropyThe Advantage of Corporate Philanthropy is now more important to consumers than ever more. There are many benefits to being a corporation that gets involved with nonprofit organizations. Below we will take a look at the different aspects that contribute to the advantage of corporate philanthropy, as featured on the Harvard Business Review.
Factor Conditions
Productivity is determined by the level of training workers have been given. Charitable giving can help to improve education and training. DreamWorks SKG, which is a film company, has just recently started a program that aims to assist low-income students in LA to gain skills needed to get work in the film industry. This benefits the community socially because low-income residents will now have access to better education and better employment opportunities. This benefits the economy by having more available graduates that are specially trained.
Demand Conditions
Demand conditions consist of the size of the local market the product or service intends to serve, how appropriate the product standards are, and how sophisticated the potential customers are. The more sophisticated the customers are, the more enhanced the region’s competitiveness becomes. Philanthropy has the ability to influence the quality and size of the local market. Providing specific products and services to a local market can help to make them more sophisticated and well-trained.
Strategy and Rivalry Context
Productivity is influenced by norms, rules, and incentives that govern competition in a region or nation. Philanthropy can have a significant influence on creating a more productive and transparent environment fit for competition. Transparency decreases corruption and helps to make an environment that allows for fair competition and enhanced productivity.
Related and Supporting Industries
High quality supporting industries and services that are nearby can greatly increase a company’s productivity. Philanthropy can help create the development of clusters and foster the strength and growth of supporting industries. There is also an economic gain, as local travel clusters become more competitive and therefore increase their growth. This reflects back and provides a better market for corporations.