Uncategorized May 07, 2024

In part 1 (read here) I explained the difference between the words Philanthropy and Capitalism, Collaboration and Partnership, all Greek words popularised by the Romans. Philanthropy means ‘love of mankind’, capitalism means ‘an economic system controlled by private owners for profit’. Quite different. Collaboration and Partnership – which is what we at® specialise in – is about working together, sharing resources and responsibilities with mutual benefit.

Practical differences

There are theoretical differences but also practical and legal differences. When a company partners with a charity and derives a commercial difference (eg there is mutual benefit), it cannot be called a ‘philanthropic donation’ because according to the ATO, it’s not. If a company’s ‘philanthropic foundation’ invests money into a charity and claims a philanthropic tax deduction, they cannot ask or demand logo recognition or PR. Again, it would be contrary to the ATO rules.

I’ve worked with companies for almost 30 years helping them to invest resources (including money) into charitable causes. The majority don’t do it ‘for the love of mankind’, there is always a self-interest, and often there’s tangible, measurable benefits flowing back to the company. Most commonly: improved reputation, staff morale and motivation, brand differentiation, emotive stories, and in some instances, increased sales. Public companies, in particular, have shareholders to answer to, so being able to ‘do good’ that also benefits the company, satisfies even the most money-centric capitalist shareholder.

It's important for non-profits to understand these differences if you want to engage – and partner with – corporate organisations and brands.

A corporation or brand may want to ‘partner’ with your non-profit, but how do you know when it’s philanthropy and how do you know when it’s a business arrangement seeking benefit? A simple way that I’ve found to help changemakers navigate this complex area is to reference ‘the 4 purses’. 

If you’re in discussion with a company (whether they approached you or the other way around) look at the job title of the person you’re talking to. That job title will give away what ‘purse’ they’re responsible for and what return that purse holder may want. If the person’s title is ‘Head of St George Foundation’ it’s likely they’ll want to invest for societal impact. So, the philanthropic purse.

However, if the person is Head of Marketing for Arnott’s, then they’re going to want a marketing return – differentiation, reach to new markets, resonating with customers, stories for social media – and so on.

We have a great (free) infographic that details each purse, download it here.

Clearly, it’s important for income generators (fundraisers/corporate partnership managers/BDMs) to know the difference. Because if you don’t know who you’re talking to or understand their motivations for partnering with you, it’s unlikely you’ll be speaking their language or get that partnership across the line.

Boards – get on board

It’s absolutely vital that management and Boards also understand these distinctions. Occasionally we encounter non-profit Boards that believe corporates should give money because they posted a healthy profit, or are happy to give away money for a feel-good return (ie philanthropy). Whilst this may have been the case a decade ago, in this economic climate, it’s a rarity.

Does the language really matter, as long as they give? Yes, I believe it does, because a Board member that believes a company will give money just because an ‘ask’ is made, or they have a relationship with someone at the company, is underestimating the complexities involved and the true amount of work that the fundraiser (or corporate partnerships manager/BDM) must do, to land a corporate partner. Not to mention that a corporate partnership that is rushed into, carries huge risk. 

How this manifests itself – alas we witness this all too often – is that an unrealistic budget is set, to be achieved within an impossible timeframe, and fundraisers/BDMs/corporate partnership managers are unintentionally set up to fail. The result? The frustrated employee leaves to find an organisation that genuinely understands the corporate landscape, and the realistic timeframe to win a partner. If you’re a CEO or Board member and you’ve noticed a high turnover in your fundraising team, perhaps this is something worth contemplating?

We recommend that for every hour spent on recruiting the best fundraiser/corporate partnerships manager/BDM, Board members and management spend at least the same amount of time educating themselves about the job they’re asking them to do, to avoid losing them months later.

There’s plenty of free resources at our website to get you started: 

As the bard Shakespeare once said, “Expectation is the root of all heartache”.


Hailey Cavill - Jaspers


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