Geographies of corporate philanthropy: The Northern Rock Foundation

Abstract

The paper contributes to literature on the geographies of corporate philanthropy through a case study of the origins, growth and decline of the Northern Rock bank's charitable foundation. Analysis reveals the complex, geographically-embedded nature of philanthropic motivations and impacts. It demonstrates that investment in home and community by philanthropists was part of a regionallyinscribed business-model of excessive risk taking that brought them considerable personal financial rewards. It highlights tensions and conflicts between corporate philanthropists and professional grantmakers over the scale and regional focus of giving. The paper concludes that the positive outcomes of corporate philanthropy are difficult to sustain in disadvantaged regions where shifts in corporate strategy and fragilities in the local economy undermine charitable giving.

Microregional patterns of corporate philanthropy: the role of economic structure and regional determinants

“…There is a positive relationship between regional economic performance and CP. (Marshall et al 2018); (Fuchsová et al 2018) Position in the urban hierarchy…”

“…Firms with headquarters located further from metropolitan cores donate more than firms based in metropolitan cores 6 . (Hurd et al 1998 (Hurd 1998); (Paarlberg & Yoshioka 2016); (Marshall et al 2018) cording to the slack resources hypothesis (Waddock & Graves 1997;Melo 2012), availability of financial funds resulting from the good profitability in the past should increase the rate of CP. On the other hand, leverage, a proxy for a firm´s riskiness, should affect CP negatively (Ho et al 2012).…”

“…Charitable giving is more likely to be successful in prospering regions with a dense network of donors and charitable organisation, some authors suggest a positive relationship between regional economic performance and CP (Wolpert 1995;Marshall et al 2018;Fuchsová et al 2018). Mill ( 1848) argued that there is a (spatial) mismatch between the distribution of charitable resources and social needs (see also Mohan & Breeze 2016 for testing).…”

“…Except for several valuable contributions (e.g. Hurd et al 1998;Card et al 2010;Paarlberg & Yoshioka 2016;Mohan & Breeze 2016;Marshall et al 2018;Ding et al 2019), the geographies of corporate philanthropy (CP) have largely been neglected. Probably the most missing are empirical studies focusing on differences in the rate of CP at the city and regional level.…”

The Role of Mediators in Diffusing the Community Foundation Model of Philanthropy

“…Hartmann (2018) writes that, contrary to expectations, so-called "international" elites are something of a fiction, because the need for elites to share analogous class-based experiences, reflecting commonly held assumptions and values, is fundamental Maclean et al, 2006). While his comments may be provocative, they contain an important truth, borne out by our research: namely, that philanthropic endeavors and impacts are geographically embedded, such that giving back to a community with which philanthropists identify often takes center stage (Maclean et al, 2015;Marshall et al, 2018). Our study of the CFTWN, anchored in a local field of power, shines a light on this salient truth.…”