Strategic in What Sense? Corporate Foundation Models in Terms of Their Institutional Independence and Closeness to Core Business

With the growing number of corporate foundations and their increasing visibility as philanthropic actors, interests are raised regarding the way these corporate foundations function as well as about the nature of their relationship with the founding company. The foundation literature generally assumes that a foundation's ability to create social impact and innovation rests to a large part on their independence from external control. However, corporate foundations are dependent to varying degrees on the support of their founding company. Therefore, apparent tensions between corporate control and the freedom a foundation needs to maximize its impact exist. In this chapter, we look at the special relationship between the two entities. Based on an exploratory study, we build ideal types of foundations in relation to their institutional independence. We then test and refine these through data gathered at the first European meeting of corporate foundations. The findings allow us to distill pull and push factors that lead to a stronger alignment of corporate goals and foundation activities. The ideal types show that full independence is not necessarily the best option, as corporate foundations can benefit greatly from corporate resources in achieving their social mission.