Initiatives to encourage corporate philanthropy

Question

Ms Chia Yong Yong: To ask the Deputy Prime Minister and Minister for Finance whether a survey has been conducted, or an analysis done on existing data, on the percentage of profits contributed by companies as part of their corporate social responsibility commitment to Singapore and what strategies will the Government adopt to encourage such responsible commitments to mitigate the strain on the application of public funds to social causes.

Response

1. Minister Lawrence Wong: In 2012, the National Volunteer and Philanthropy Centre (NVPC) surveyed over 100 companies on corporate giving. 3 in 5 companies surveyed said they contributed around or less than 0.5% of their pre-tax profits for year 2011 to local non-profit organisations. Cash donations were the most common form of giving and the median donations in cash was about $12,000 per company that year. That comes from a survey done by NVPC on 100 companies. It is not comprehensive but it provides a dipstick.
   

2. Besides the survey, we also have data from Inland Revenue Authority of Singapore (IRAS). According to the claims submitted to the IRAS in Year of Assessment 2012, companies which claimed for approved tax-deductible donations collectively donated about 0.32% of their pre-tax profits, with an average donation of about $30,000 per company. In Year of Assessment 2013, this percentage increased to 0.53%. So from 0.32% in year of assessment 2012, to 0.53% in the year of assessment  2013, with an average donation of about $46,000 per company.
   

3. More generally, corporate giving has been on the rise. For example, over the past 10 years, donations by companies to Institutions of a Public Character (IPCs) doubled from $325 million in 2004 to $644 million in 2013. Companies have accounted for about two-thirds of total giving to IPCs for the past 10 years.
   

4. There are various financial incentives in place to encourage corporate philanthropy. First, the Government offers 2.5 times tax deductions for donations to IPCs. Second, the Government supports the good work by non-profit organisations by matching donations through various schemes to encourage giving to the social sector. These include the Care and Share Movement for the social service sector, the Singapore Universities Trust for giving in the higher education landscape, the Community Silver Trust for the intermediate and long-term care sector, and more recently, the Cultural Matching Fund to benefit the arts and heritage sector.
   

5. To complement these financial incentives, the NVPC is also stepping up its engagement efforts to get more companies involved in giving back to the community. For example, the NVPC has started a regular series of lunches with CEOs and business leaders. Through these sessions, NVPC will facilitate the matching of companies with non-profit organisations. The NVPC hopes to share best practices and build a network of like-minded companies which could make a significant impact on society and benefit many social causes. So this will strengthen current efforts by NVPC to promote corporate giving, which includes many of its existing efforts like the SG Gives portal, the Community Foundation of Singapore, and the annual President's Volunteerism and Philanthropy Awards.