Corporate restructurings: ripple effects on corporate philanthropy

Corporate restructurings, by their very nature, are inherently disrupting. With managerial discretion potentially curtailed, the ripple effects of restructurings are likely to be widespread and long‐lasting. This paper examines one ripple effect of corporate restructurings: the effects of donations from corporate philanthropic foundations after acquisitions. By extending the business strategy merger and acquisition (M&A) literature to include philanthropic activities and applying the corporate citizenship literature to an M&A context, the author creates a model and tests hypotheses. Simultaneous examination of the impacts of corporate citizenship and business strategy is warranted in today's research on corporate restructurings, since larger acquisitions are occurring more frequently, and acquisitions have the potential to adversely affect large numbers of individuals. As ever‐larger firms consolidate, with record‐breaking merger announcements, the potential for increased scrutiny by the media, shareholders, anti‐trust officials and salient stake‐holders is heightened. These findings, contrary to predictions, suggest that corporate philanthropy increases during the first year after an acquisition within the same industry. Moreover, the increase is sustained. Philanthropic donations continue to increase three years after acquisitions within the same industry. Implications for public affairs executives is examined. Copyright © 2004 Henry Stewart Publications     

The transformed identity of a banking corporation's employees, 1960s–1980s

The current paper discusses one aspect of corporate social responsibility—employee community volunteering—as implemented at an Israeli banking corporation. The literature on corporate social responsibility as a feature of global capitalism has largely ignored the history of corporate philanthropy and its relation to the current model of social responsibility. Moreover, to date, no studies have addressed the relationship between models of corporate social responsibility, on the one hand, and management approaches, on the other. In this historical–ethnographic study, we examine a case in which, we argue, normative management models and advanced marketing approaches combined to shape new conceptions and practices of employee volunteering. We examine how the process evolved over the course of three marketing campaigns initiated by the bank's management between the early 1960s and the early 1980s. In the early 1960s, the models in question helped refashion the employees' identity as service providers ‘empathic’ toward clients. By the late 1970s, their identity was transformed once again, this time to incorporate a ‘humane’ orientation toward the ‘community’. In the process—the results of which are still felt today—the employees became the carriers and disseminators of an organizational culture that emphasized values of philanthropy and social commitment. Copyright © 2014 John Wiley & Sons, Ltd.     

The impact of downsizing on the corporate reputation for social performance

This paper investigates the impact of downsizing on a firm's reputation for corporate social performance (RCSP). Drawing on the downsizing, corporate reputation and social responsibility literatures, a number of hypotheses concerning the impact of downsizing, and particularly the types of downsizing, on a firm's reputation for corporate social performance are developed and empirically tested. The main findings of this study are that, while downsizing seems to have a negative impact on the firm's RCSP, when one takes into account the kind of managerial action that led to downsizing (layoffs and/or divestitures), this impact differs between the two stakeholder groups, industry executives and financial analysts, which were investigated. This study also found that a high financial performance prior to downsizing led to a greater negative impact on the firm's RCSP. Copyright © 2004 Henry Stewart Publications     

Economic integration and the relationship between profit and wage taxes

This paper analyzes the development of the ratio of corporate taxes to wage taxes using a simple political economy model with workers and capitalists that own internationally mobile and immobile firms. Among other results, our model predicts that countries reduce their corporate tax rate, relative to the wage tax, when preferences for public goods increase, or when the share of capital employed in multinational firms is rising. We further show how an increase in the wage share changes both the relative size of tax bases and the political influence of different income groups. The predicted relationships are tested using panel data for 23 OECD countries for the period 1980 through 2004. The results of the empirical analysis support our main hypotheses.     

Corporate Governance and Corruption: A Cross-Country Analysis

Because the empirical literature on the causes of corruption has focused primarily on the demand side of corruption, that is, the corrupt officials who receive bribe payments, the role of the private sector as the supply side of corruption has not been examined thoroughly in this literature. In this article, it is argued that corporate governance is among the important factors determining the level of corruption. Using a cross-country data set, hypotheses that explicitly link various measures of corporate governance to the level of corruption are tested. The results show that corporate governance standards can have profound impacts on the effectiveness of the global anticorruption campaign.     

Reduction of Party Conflict through Corporate Participation in Danish Law-Making*

The paper focuses on the link between the two 'channels of political influence that exist in most liberal democracies: the electoral-parliamentary channel with political parties as the crucial structures intermediating between citizens and decision-makers, and the organizational-corporate channel with interest groups as intermediating structures. Although the two avenues open to citizens' demands may often function as alternatives, they are not independent of each other. Thus, the involvement of organizational and institutional interests affects the level of partisan conflict in the law-making process. The main assumption is that if bills are drafted by the active participation of external actors, they are likely to be passed at a relatively low level of conflict in parliament. A number of specific hypotheses based on this assumption are tested on data pertaining to Government bills passed by the Danish parliament 1972–74. The hypotheses relate to different types of bill preparation, subsequent outside contacts to parliamentary committees indicating societal disagreement on bills, and different areas of public policy. While the evidence gives strong support to the hypotheses it also indicates limits to the influence of external actors. This suggests an important difference between the two channels: like the corporate channel the parliamentary channel is one of influence, but unlike the corporate channel, it is also one of national responsibility.     

The Role of Philanthropy in Local Government Finance

Nonprofit organizations thrive on the altruism of citizens, and actively court donors for major gifts. Yet individual gifts to government agencies are often unexpected, sporadic, and initiated by the donor. This article introduces the phenomenon of private giving to local governments and tests hypotheses regarding the expected forms of giving to public agencies. Results indicate that philanthropy is and will likely remain a minor and highly variable source of revenue, making it an ill‐suited replacement for broad‐based tax revenue. However, deliberate government efforts to provide a suitable environment for private donations appear to succeed in attracting more gifts per capita.     

The Intellectual Crisis in Philanthropy

Defenders of modern philanthropic freedom often defend donor intent and celebrate voluntary action. Nevertheless, donor intent and voluntarism have often undermined the conditions of constitutional freedom. This paper proposes that philanthropy currently suffers an intellectual crisis very much like the intellectual crisis in public administration diagnosed by Vincent Ostrom. The Common Core State Standards initiative is a case study of the problems of epistemic drift in philanthropy and raises questions about whether merely defending donor intent and voluntary action for their own sake is sufficient. To escape philanthropy’s current intellectual crisis requires a clearer consideration of the epistemic choices that shape donor intent and voluntary action.     

Elite Philanthropy in Israel

The paper presents the findings of a study on elite philanthropy in Israel. The study aimed to describe and analyze the scope of elite philanthropy, which has been affected by the growth and relative stability of the Israeli economy. The study also aimed to shed light on the demographic characteristics of elite philanthropists, their motives for giving, preferred target populations and areas of interest for donations, the value of donations, and the channels and mechanisms through which donations are made. The findings revealed that the average percentage of donations out of the philanthropists’ total earnings was not lower than the percentage found among philanthropists in other Western countries. In the paper, we clarify the meaning of elite philanthropy in the context of Israeli society and the role of elite philanthropists in promoting social programs. We discuss the philanthropists’ sense of obligation to “give back” to the society which enabled them to become wealthy.     

The Balancing Act: Using Private Money for Public Projects

As public resources become scarcer, private donations for capital projects and public services may become increasingly important. Modern donors, using the new philanthropy philosophy common now in the nonprofit sector, may desire more control over the use of their funding than in the past. This research examines the effects of private donations on capital decision making, and explores the balancing act required by public officials between best practices and private norms in this process. The study uses the city of Omaha, Nebraska case, where corporate and individual donors have made significant financial contributions for the construction of a convention center/arena and a baseball stadium. Findings include both costs and benefits of this approach, and may be beneficial for theory‐building related to this relatively unexplored topic, as well as for practitioners faced with similar needs and demands.     

Philanthropy and Civil Society: Comparative Perspectives on Private Solutions to Public Problems

Abstract

This article outlines a graduate course about private philanthropy in a public affairs program. Using an experiential learning model called student philanthropy, the course provides students the opportunity to examine philanthropic behavior at a global scale and advances a major debate in the field of philanthropy that compares the merits of giving locally versus giving internationally.     

The Impact of Local Economic Structure on Community Philanthropy

This article explores how local economic structure directly and indirectly affects community philanthropy. Drawing on campaign data for local United Way (UW) affiliates at three points in time (1990, 2000, and 2010), the article tests the degree to which the relationship between economic structure and community philanthropy is mediated through local stocks of human resources and social capital. The results suggest that retail employment and industrial concentration negatively affect local UW campaigns, while nonlocal ownership positively affects UW campaign size. These measures of economic structure also indirectly influence local UW fund‐raising activities by affecting the levels of human resources and social capital. In the midst of global efforts to increase community‐based philanthropy, these findings have important policy implications for efforts to promote community solutions to social issues in changing economies.     

Free Riding in State Legislatures

This paper applies the theory of team production to thelegislative process and tests the empiricalimplications of that theory using a uniquestate-level data set. Empirically testablehypotheses are derived from the theory,including predictions that free riding willincrease as chamber (or majority) sizeincreases, and that legislativeinstitutions (such as committee structureand staffing levels) can mitigate freeriding. The hypotheses are tested using apooled state-level data set developed fromthe session laws of twenty-three statelegislatures. The empirical results areconsistent with the major hypotheses.     

社会保障体系的巨灾风险补偿功能分析——美国9．11五周年的启示

五年前,在9.11恐怖袭击事件中,美国社会保障制度在巨灾补偿中发挥了一定的作用.其中有很多经验,例如,国家对巨灾损失的补偿是通过国家计划、保险公司和慈善事业这个"三条腿机制"发挥作用的,并通过立法建立了一个临时机构:"9.11遇难者补偿基金",令其根据普通法的原则,赋予全权,统一运作全国的补偿工作;也有一些教训,例如,社会安全号信息管理不善和被盗用,从而酿成飞机劫持者拥有合法的手续等.我国要建立起社保制度突发事件巨灾风险补偿的"三条腿机制"还有很长的路要走,例如,基本社保制度的工伤保险中存在着诸多问题,保险业还需进一步改革完善,慈善事业的机制缺位等;对尽快建立一个混合型的"国家巨灾补偿机制"提出了一些不成熟的改革思路和采取公共委托与购买的方式进行损失补偿的设想.     

Mega Donors’ Perspectives on Philanthropy and Government Relations in Israel

Philanthropists’ involvement in the development and implementation of social policies is a growing yet understudied phenomena. Captured in the model of alternative politics, in which self-provision of public services emerges when citizens face the failure of private and public mechanisms, not only in terms of obtaining sufficiently high-quality services, but also in terms of utilizing political channels to influence public policy, and poses major challenges to the political system. This dynamic of welfare states in recent decades is contested, since while it provides new streams of funding and innovative and professional capacities, it also has potential negative repercussions to democratic processes, equity and universalism of social policies. In-depth interviews with fourteen Israeli mega donors are used to show how mega donors promote relations between philanthropy and government in Israel that are based on voluntary cooptation in which the government regulates the philanthropic activity in Israel. By voluntarily granting the government a mandate to regulate philanthropic activity, the mega donors lead philanthropy into a situation in which philanthropy’s autonomy may be jeopardized and its agendas may be subordinated to the priorities, preferences and business-minded worldview of the ruling elite - the political elite (government) and the business elites (mega donors).     

The determinants of corporate political strategy in Chinese transition

• Corporate political strategy (CPS) formulation in Chinese transition is an area with little empirical work. We fill this gap validly and the primary focus of this study is to examine the firm‐ and industry‐level factors influencing Chinese firms' political strategy choice. Empirical support is found for the taxonomy of corporate political strategies in Chinese transition—that is direct participation strategy, financial incentive strategy, prolocutor strategy, institution innovation strategy, government association strategy and government involvement strategy. The results indicate that there is no consistently significant firm‐ and industry‐level predictor of all six political strategies and we explore what determinants are related to each specific decision independently. We also verify the random effects of industry‐level variables and our hypotheses are tested through using general evaluation equations (GEEs). Our study aims to be helpful to point managers toward both industrial environments and internal resources to consider when making appropriate political strategy choices and thus improve Chinese firms' strategy management level. Some implications of findings are also discussed finally.

Copyright © 2007 John Wiley & Sons, Ltd.     

Public Sector Corporate Governance Disclosures: An Examination of Annual Reporting Practices in Queensland

In the public sector, corporate governance is an expression that is yet to be explicitly defined. This paper examines the existing public sector literature in order to derive a set of broad principles of corporate governance in the public sector. These principles are then applied through a content analysis of corporate governance disclosures in a group of government‐owned corporations, state government departments, local governments and statutory bodies. The results indicate the set of principles derived is generally applicable to various forms of public entities. However, due to a lack of an established public sector corporate governance framework, the disclosure of corporate governance is piecemeal. Government‐owned corporations achieved better disclosure practices in most principles than other public sector bodies. The paper aims to stimulate debate on public sector corporate governance and provides a basis for a more extensive survey on corporate governance disclosures.     

Liberty, Nobility, Philanthropy, and Power in Alexander Hamilton's Conception of Human Nature

Alexander Hamilton's conception of human nature grounds his political thought. His predominately and radically liberal conception of human nature is based on Locke's concept of liberty, Hobbes's concept of power, and Machiavelli's concept of the "effectual truth." It thus stresses the necessary relation between self-interest and republican government and entails the repudiation of classical republican and Christian political ideals. But Hamilton's love of liberty is nonetheless rooted in a sense of classical nobility and Christian philanthropy that elevates even while contradicting his liberalism. The complex relation between liberty, nobility, philanthropy, and power in Hamilton's conception of human nature, in effect, defines his thought, reveals its assumptions, constitutes its strengths, and poses urgent problems. That complexity forms the spirit of his liberal republicanism.     

A preferential attachment model of campaign contributions in state legislative elections

In state legislative elections some candidates attract contributions from many donors whereas other candidates have much smaller donor pools. Why? What are the origins of these disparities? This paper conceptualizes contributions as a type of attachment between the donor and the state legislative candidate. To model the formation of these attachments, this paper proposes a variant of the Barabasi-Albert preferential attachment model. The theoretical model is tested with data on over one million contributions to state legislative candidates in 2008. The paper also derives implications for macro-level inequities across candidates which are tested by comparing the observed inequities to simulations of the preferential attachment model. The results provide strong support for the hypotheses and show that the preferential attachment model provides a parsimonious representation of contributions to state legislative candidates.     

The hijacking of a new corporate form? Benefit corporations and corporate personhood

Benefit corporations are a new type of corporate entity developed to remedy antisocial corporate behaviour by enabling mission-driven investors, managers and entrepreneurs to prioritize social values and contest the idea that profits are the only and best measure of corporate performance. To resocialize the corporate entity, the benefit corporation movement built enabling discourses and evaluation practices into the dominant model of corporate governance, shareholder value ideology. These discourses and practices expand both the purpose of the corporate entity and shareholders’ power to enforce that purpose. However, this paper argues that the effort to ‘re-embed’ the corporate entity by making it subject to non-economic claims expands the scope of corporate personhood and that doing so within extant power relations of the firm opens the door to alternative projects that undermine the benefit corporation movement's goal of fostering corporate social responsibility.