Royal commission pushes finance sector to up its giving

In the wake of the banking royal commission, the Australian finance sector dug deep into its pockets in 2018, lifting its charitable giving by 28 per cent, an additional $39 million. 

The second annual GivingLarge report found the largest increases came from Commonwealth, NAB and ANZ, with funds going into education, health and medical research and financial literacy and inclusion. 

The increased levels of giving by finance companies represented the biggest moving sector of all top 50 listed Australian companies analysed in the report.  

Jarrod Miles, the director of Strive Philanthropy, said the royal commission was a driving force behind that change. 

“As the royal commission conducted countless hearings, interviews and audits into the finance sector, our results suggest that our top companies took this opportunity to reach further into their deep pockets to give greater amounts to the community,” Miles said. 

The report, compiled by Strive Philanthropy and supported by Philanthropy Australia, found the top 50 listed Australian companies donated $945 million in 2018, an 11 per cent increase from 2017.  

Wesfarmers, the retail giant behind Kmart, Target and Bunnings, was again the largest giver when it came to contributions from pre-tax profits, donating $87 million or 2.5 per cent of its bottom line returns in 2018. 

Oil Search was the largest giver as a percentage of earnings, donating $31 million or 1.73 per cent. The mining and materials sector contributed the largest total amount at $393 million, representing 42 per cent of the total.   

The total amount of donations represented a 0.62 per cent contribution of pre-tax profit and a 0.58 per cent contribution of earnings. But Miles told Pro Bono News that figure was seriously lagging behind the global benchmark of 1 per cent.  

“This really signifies a remarkable opportunity for this group of companies to potentially shift an additional $600 million to community programs if they can commit to that reasonable target,” Miles said.    

Of the total $945 million, 80 per cent came from the top 10 companies and 79 per cent came from the materials, finance and consumer sectors. The industrial, utility and information technology sectors sat at the bottom end, making average contributions below 0.3 per cent.  

Miles said there was a great opportunity for the less generous sectors to push their contribution in line with their ASX peers. 

“The community sector would not only benefit from having more companies give larger amounts, but the diversity of giving will be greater if we can bring up other players,” he said. 

He also encouraged community groups to use the data in the report to work with companies at the lower end of the giving spectrum. 

“The report outlines each companies’ top causes, which community organisations can utilise to be strategic about who they approach,” he said. 

Miles said the majority of the funds went into supporting health, education, diversity and inclusion, and that giving was often sector specific.  

“The finance sector invests in financial education and financial inclusion, whereas the energy sector will invest in energy education, sustainability and how to educate the population around energy issues,” he said. 

He said with a lack of research on the topic already, it was vital companies were transparent in their reporting, something he hoped to see an improvement on in future years. 

“The improvements in reporting will translate into much more meaningful and robust analysis, and hopefully even the playing field for some healthy philanthropic competition,” he said.