End of the Road: Another Corporation Reboots Its Philanthropy

These are interesting times for corporate philanthropy. An older model of charitable giving is losing traction and being replaced by a new, more comprehensive approach to advancing a social mission. 

The traditional model of corporate philanthropy involves giving that tends to be compartmentalized and uncreative. Companies set aside a certain amount of money or product that their philanthropic arms dole out in largely safe and predictable ways, often with a local focus and an eye toward gifts with a high "feel good" PR quotient. 

The newer model takes a more integrated approach to harnessing a range of corporate assets to have a social impact—often in ways that also advance a company's bottom line. The basic idea, here, is for corporations to play to their competitive philanthropic advantage with an eye on enlightened self-interest. 

There are many examples of this integrated approach, which we cover often. Lately, for instance, the big banks have given millions for workforce development initiatives to boost the skills and career readiness of urban youth—a key source of entry-level workers for those banks. These efforts often involve both grantmaking and company activities. Tech and energy companies, also fretting about tomorrow's workforce, are investing heavily in STEM education—giving money, product, and the time of tech-savvy employees. 

GM is the latest corporation to reboot its philanthropic strategy and migrate toward a more holistic and strategic approach. 

Since it first opened its doors in 1976, the GM Foundation focused its nearly $1 billion in charitable giving on education, disaster relief, and community development. In 2016, GM began redirecting its giving efforts from a “foundation-based giving model to a global social impact strategy,” with the overall goals of advancing economic growth around the globe, improving vehicle safety, building sustainable communities, and increasing the number of students pursuing science, technology, engineering, and math (STEM) education. Recently, as part of finalizing this shift, the country’s largest car maker announced that it is closing its foundation’s doors for good.  

It's worth mentioning that several other car makers give high priority to STEM education in their corporate giving, most notably the Honda America Foundation. There's a reason for this focus: Making cars is becoming a lot more complicated, involving technologies like advanced robotics, and workers with the right skills can be hard to find. With changing demographics, car makers also are keen to encourage diversity among future STEM workers, and GM says that encouraging minorities and STEM degrees among its workers is a priority in its new giving. GM is also taking aim at increasing the number of qualified STEM educators.

Related: Check Out Another Car Company Giving Millions to STEM

GM is reorganizing philanthropic efforts in a new program, GM Global Corporate Giving, which will control around $30 million in annual giving. The change, according to senior vice president of global communications Tony Cervone, will not result in a decrease in GM’s charitable giving overall. Among other things, Cervone says the new giving program will free GM from “foundation type rules,” allowing it to “work with partners that it chooses to drive specific social change.”

Another element of GM's new philanthropic strategy focuses on a vehicle and road safety program, with goals that include reducing the number of vehicle-related injuries and deaths, increasing seatbelt use, decreasing distracted driving, and increasing road safety knowledge and skills.

Finally, its sustainable communities program is focusing on reducing unemployment, increasing education levels and marketable skills, supporting neighborhood revitalization and increasing college readiness for high school students.

GM began transitioning its corporate giving a year ago, so it remains to be seen how all this will play out over time with annual grantmaking

While we wait for new grant and donation announcements to roll in, GM is maintaining its future commitments of over $7 million to the Buick Achievers Scholarship, a $2 million endowment to the Detroit Institute of Arts, and a $1.6 million pledge to Kettering University located in Flint, Michigan.