Mendoza School of Business

Companies cut holiday parties and donate to charity instead

Published: December 11, 2008 / Author: Kevin McCoy

Although the recession has Scrooged many corporate parties off the 2008 holiday calendar, some firms are transforming humbug into humanitarianism by giving the savings to charity.

Company-sponsored holiday galas hit a 20-year low in 2008, according to an annual survey of 108 firms by executive search firm Battalia Winston Amrop.

Calling the cancellations “unhealthy,” Dale Winston, the search firm’s CEO, said the parties are “one of the last vestiges of corporate socialization left.”

But instead of saving cash, some firms are pursuing a more selfless mission.

Maryland office service firm The Kane Co. gave $15,000 to the Capital Area Food Bank after scrapping its party.

“I don’t think the caterers in town love me right now. But the food banks do,” CEO John Kane says.

Alkermes, a biotechnology firm in Cambridge, Mass., opted to buy 2,500 pounds of turkey and roast beef for the Greater Boston Food Bank with $10,000 previously earmarked for a party.
The donation surprised and delighted Paul Colligan, director of programs for the food bank. “It will probably provide over 1,900 meals, so it will go a long way,” says Colligan, who will route the food to four local charities.

Red Hat, developer of Linux-based software, took a vote among workers at the firm’s Raleigh, N.C., base after canceling the holiday party. The outcome? One million pounds of food for Feeding America, a charity that coordinates more than 200 food banks nationwide.

“It’s the equivalent of providing 800,000 meals. Everyone felt it was the right thing,” says Red Hat spokeswoman Kara Schiltz.

Even some financial institutions hit by the economic meltdown opted to give something back after scrapping celebrations. Instead of its traditional New York City gala, Swiss bank UBS is donating $100,000 to two charities.

Accounting firm PricewaterhouseCoopers’ San Francisco office still plans a party. But guests will pay $100 each, with proceeds going to United Way of the Bay Area.

The switches may generate more than just goodwill.

“Given how many people are hurting financially, I think it would be a good business decision,” says Patrick Murphy, co-director of the Institute for Ethical Business Worldwide at the University of Notre Dame. “But I would add the caveat that management should talk to employees about why they’re doing it.”

Business wasn’t a main concern, though, when Benefit Concepts, a western New York insurance, investment and employee benefits firm, scrapped its holiday plans and gave $5,000 to six Buffalo-area charities.

“We just felt we should give back to our community,” President Marc Baranson says.



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