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Companies and philanthropy

Corpo­rate foun­da­ti­ons sit some­where between entre­pre­neurship and nonpro­fit work. At present, Switz­er­land is home to around 225 foun­da­ti­ons with a close connec­tion to a company. 

Corpo­rate foun­da­ti­ons are foun­da­ti­ons with their own legal perso­na­lity that were foun­ded by a company for the purpose of enga­ging in phil­an­thropy. They straddle two sepa­rate worlds. Why? Because compa­nies are always focu­sed on profit, while foun­da­ti­ons pursue a chari­ta­ble purpose. By setting up a foun­da­tion, commer­cial enter­pri­ses can build a bridge to civil society. It’s about buil­ding trust and ‘corpo­rate social respon­si­bi­lity’, the respon­si­bi­lity a company holds towards society – an incre­a­singly important issue. By giving some of their profit to a foun­da­tion, compa­nies express their willing­ness to engage with socie­tal issues in the long term. Plus, corpo­rate foun­da­ti­ons gene­rally find it easier than profit-focu­sed compa­nies to get in touch with other NPOs. 

Diffe­ren­ces in size and purpose

At present, Switz­er­land is home to around 225 corpo­rate foun­da­ti­ons. ‘They include foun­da­ti­ons of all stri­pes, but every one of them is closely connec­ted to a company,’ says Profes­sor Georg von Schnur­bein, Direc­tor of the Center for Phil­an­thropy Studies (CEPS) at the Univer­sity of Basel. ‘The foun­da­tion can be estab­lished by the company or by an owner of a company.’ It is diffi­cult to say what the precise number is. Firstly, the Swiss foun­da­tion sector is large and dyna­mic, with nume­rous new foun­da­ti­ons set up and others liqui­da­ted every year. Secondly, corpo­rate foun­da­ti­ons can differ greatly in terms of their size, purpose and rela­ti­ons­hip with their parent company. Some might engage in work in a simi­lar area as the company, whereas others are deli­ber­ately focu­sed on a very diffe­rent field. 

Repu­ta­tion and marketing

There are various reasons why a company might set up a nonpro­fit foun­da­tion. ‘In the simp­lest case, the foun­da­tion is set up for the sake of repu­ta­tion and marke­ting,’ says von Schnur­bein. There are also instru­men­tal consi­de­ra­ti­ons if the content of the foundation’s work is close to the company’s core busi­ness and offers synergy effects for both parties. This is illu­stra­ted by the Syngenta Foun­da­tion for Sustainable Agri­cul­ture, estab­lished by Syngenta, a produ­cer of plant protec­tion products, or the Hear the World Foun­da­tion, which the Sonova Group, a hearing aids manu­fac­tu­rer, uses to support child­ren around the world who are affec­ted by hearing loss. That said, there are also foun­da­ti­ons active in a comple­tely diffe­rent area from their company, as is often seen in the finan­cial sector. Banks like Credit Suisse or UBS use their foun­da­ti­ons to support cultu­ral, social and scien­ti­fic projects, and in the phar­maceu­ti­cal indu­stry, rese­arch foun­da­ti­ons can safe­guard scien­ti­fic inde­pen­dence through their legal form.

Corpo­rate foun­da­ti­ons exist in every sector, but it tends to be larger compa­nies that set up foun­da­ti­ons. Some, like Novar­tis and Nestlé, have laun­ched more than one foun­da­tion. The number of corpo­rate foun­da­ti­ons being estab­lished has conti­nued to creep upwards since the 1980s, ‘But the upco­m­ing reces­sion could bring an end to this trend,’ says von Schnurbein. 

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