Companies caught in controversy turn to charity
Gilead (GLD), by some measures the biggest biotech firm, has found itself in hot water in recent years over its high-priced treatments for Hepatitis C. Wall Street firms such as JPMorgan (JPM), Goldman Sachs (GS) and Bank of America (BAC) are still trying to restore their reputations that were tarnished during the financial meltdown, while unions have targeted retailing giant Walmart (WMT) over how it treats employees.
Perhaps not surprisingly, all of these firms are turning to charitable works to burnish their public image, and all rank highly on the Chronicle of Philanthropy's annual ranking of corporate giving that was released today.
Foster City, California-based Gilead gave $447 million in cash to causes, toppling Walmart, which had held the No. 1 spot for 11 out of the past 12 years. Still, Walmart remained a top corporate donor, giving $301 million even as it faces increased pressure from Wall Street to improve its bottom line.
Financial services firms are showing generosity as the try to win over consumers turned off by the multibillion legal settlements they've reached with the government.
"The financial crisis created a moment in time where people questioned the value of banks in our society," Brandie McHale, president of the Citi Foundation told the publication. "We're working hard to not only communicate but to demonstrate proof points of how a strong financial system is a critical piece of a thriving economy and society."
The Chronicle of Philanthropy found that companies typically donated less than 1 percent in cash compared with their pretax profit. Among the exceptions, however, were General Mills (GIS) and Chevron (CVX), which donated 6 percent and 5 percent, respectively. Nationwide Insurance, which is privately held, and Xerox (XRX) each gave 4 percent.
Oil company ConocoPhillips (COP) donated more than $44 million to charity, while retailer Sears Holdings (SHLD) gave $26 million, even though both companies incurred substantial losses in 2015. The Chronicle of Philanthropy found that 16 companies donated more to nonprofits even though their own profits fell.
Community projects were the most popular giving category, followed by secondary education and colleges and universities.