Corporate Philanthropy Final Draft

7/30/2019 Corporate Philanthropy Final Draft

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Running head: CORPORATE PHILANTHROPY 1

CORPORATE PHILANTHROPYAnnual Report, 2013

Prepared by Justin Straub

Associate Director of Philanthropy

Distributed 27 March 2013

Prepared for Apple, Inc.


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Company HistoryApple Computers was incorporated on January 3, 1977 in Cupertino, California by founders

Steve Jobs and Steve Wozniak. For more than two decades, Apple Computers primarilymanufactured personal computers, including the Apple II and Macintosh line. Jobs left apple in

1985 however returned in 1996 when Apple Computers bought his company, NeXT. The

following year he became CEO, a position which would be permanent. Jobs helped turnedaround Apple Computer from its sluggish sales and low growth in the 1990s with theintroduction of the iMac in 1998.

Apple Computers branched out into digital media with the introduction of the iPod in 2001 and

the iTunes Music Store in 2003. With its success in digital media eclipsing its original line ofpersonal computers, Apple Computers changed its name to Apple in 2007. Since then, Apple has

introduced the ubiquitous iPhone and iPad, and as of 2012, is the largest publicly traded

corporation in the world by market capitalization. In 2012, Apple founder and CEO Steve Jobs

died after a long struggle with cancer, and current CEO Tim Cook took over as CEO.

Mission Statement

Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWorkand professional software. Apple leads the digital music revolution with its iPods and iTunes

online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App

Store, and is defining the future of mobile media and computing devices with iPad.

Current Philanthropic Activities

Under the stewardship of Steve Jobs, Apples corporate philanthropic policy was that it wouldnt

be disclosed publicly. Central to Steve Jobs philosophy was that since Apple pays its employeesgenerously, that they themselves should donate to causes that they see fit. However under the

stewardship of Tim Cook, Apple has been more public about their contributions. Apple is

increasing its rate of contribution in its employee matching program, and the corporation is

reported to have donated money to Stanford hospitals and global AIDS outreach in Africa.

Research

In the business world, corporate philanthropy has become as ubiquitous as televisioncommercials; companies compete with each other in giving away their profits, to expand their

outreach in the community and increase their market share. This is in part driven by the demands

of a socially conscious and aware public that believes that if corporations are to benefiteconomically from their communities, that they are a part of the community and should give

back. Peoples thoughts and feelings about a company not only lie in the products or services

they provide, but on how socially aware the company is. Philanthropy is often used as a form of

marketing or public relations, promoting a company through high profile endorsements ofcharities or other nonprofit organizations.

However, philanthropy is rarely strategic and its goals are not clearly outlined. Companies are

pressured to give, but investors pressure companies against doing so to maximize short term

profits. Todays corporate philanthropy often is comprised of small cash donations to local civicgroups, donations to universities and national charities to improve employee morale and increase

public goodwill. The contributions often reflect the social values or beliefs of the owners or

employees. However, the same effect would be realized by increasing wages and salaries thatemployees could choose to donate on a tax deductible basis. There would be a larger number of


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charities and nonprofits receiving donations, and the donations would more accurately represent

the values of the employees. This was the rationale of Steve Jobs: Apple pays its employees well,

and its generosity will inspire its employees to give. In the current landscape of corporatephilanthropy this holds true, money would be more efficiently distributed to worthy charities by

a companys employees than by its management. However, if corporate philanthropy was more

strategic, and its aim was to create awareness within a certain demographic that the nonprofit orcharity represents, then it would more like an investment, than just simply a reflection on theowners and employees values (Raymond, 2004). As far as marketing strategies are concerned,

the public is tired of blanket advertisements that shamelessly boast of a product or service. With

the internet, members of the public can be an informed critic by reading reviews and product orservice descriptions and specifications prior to purchase. People today are also looking to do

business with companies that share their values. Corporate philanthropy can address the need to

promote a business in a discreet and honest way by simply stating that the company supports a

cause financially (Goldberg, 1997). If a consumer who supports a certain cause finds out that acompany also supports the same cause, the consumer will have a better opinion of the company.

If the company is unknown to the consumer, the consumer will become curious and likely

research it to learn more about the company.Companies can use corporate philanthropy to expand their market share or geographic reach by

targeting certain demographics and creating awareness in areas where the business is unheard of

or not present. Cause-related marketing, through which a company concentrates its giving on a

single cause or admired organization and they are more organized than just random corporatedonations (Smith, 1994). At its greatest extent, cause-related marketing can improve the

reputation of a company by linking its identity with the admired qualities of a chosen nonprofit

partner or a popular cause. Companies that sponsor the Olympics, for example, gain not onlywide exposure but also an association with the pursuit of excellence. And by concentrating

funding through a deliberate selection process, cause-related marketing has the potential to create

more impact than unfocused giving would provide.

As companies opt to enhance their cause based corporate philanthropy, they should concentrateon not only enhancing their publicity, but on making a social impact that will benefit the

company and the community economically.

Future Philanthropic EffortsApple as a company has generated a high degree of public opinion just by the publics

admirations of their products. Apples image has been enhanced by its products, not by whatconsumers view are its social values. A company that produces a product that is not so visible or

a service that isnt obvious in the minds of consumers would have to invest far more in corporate

philanthropy to achieve the same level of public opinion that Apple has garnered.

As Apples products become more widespread, and they become more commonplace in the mindof the consumer, Apple will have to concentrate on improving its corporate philanthropic efforts

in order to maintain its high level of public opinion. As the users of Apple products today are so

widespread demographically, it will be hard to find a target market for cause based philanthropy

to attract. Apple will have to further its public opinion by donating to research, art, anduniversities, furthering in the mind of consumers its pursuit of excellence.


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References:

Smith, C. (1994). The New Corporate Philanthropy.Harvard Business Review, 72(3), 105-116.Retrieved fromhttp://hx8vv5bf7j.search.serialssolutions.com

Goldberg, B. (1997). Corporate philanthropy seeks returns. Colorado Business Magazine, 24(1),22-25. Retrieved fromhttp://search.proquest.com/docview/215421773

Raymond, S. (2004). The future of philanthropy : economics, ethics, and management. (12 ed., p.308). Hoboken, NJ: John Wiley & Sons. Retrieved from

http://fau.catalog.fcla.edu/fa.jsp?ix=nu&V=D&I=0&st=FA022268603
http://hx8vv5bf7j.search.serialssolutions.com/http://hx8vv5bf7j.search.serialssolutions.com/http://hx8vv5bf7j.search.serialssolutions.com/http://search.proquest.com/docview/215421773http://search.proquest.com/docview/215421773http://search.proquest.com/docview/215421773http://fau.catalog.fcla.edu/fa.jsp?ix=nu&V=D&I=0&st=FA022268603http://fau.catalog.fcla.edu/fa.jsp?ix=nu&V=D&I=0&st=FA022268603http://fau.catalog.fcla.edu/fa.jsp?ix=nu&V=D&I=0&st=FA022268603http://search.proquest.com/docview/215421773http://hx8vv5bf7j.search.serialssolutions.com/

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