se institutions. The John Echlin Foundation, for example, is one major contributor to The Hospital of Saint Raphael, in New Haven, Connecticut. Firms not only built and funded many hospitals and schools, but they essentially created such national nonprofit organizations as the YMCA. Companies created hospitals in areas where their employees lived, so future workforces would be healthy. They funded community chests devoted to social, educational, and recreational amenities for employees, and even gave money to employees’ churches so that their spiritual needs would be met. Railroad companies built a system of YMCAs to give itinerant employees a place to stay the night and get a hot meal. These expenditures were relatively easy to defend to directors and shareholders, because the connection between them and the profits of the business were clear. Amoco Foundation executive director Patricia Wright put it, “anyone involved in the corporate world knows that it is necessary to have a strong strategic link between charitable giving and the corporation’s bottom line” (Hood 20).The nature of corporate giving has changed through the years. During the 1950s and 1960s outside directors of foundations, made decisions on the basis of social and humanitarian issues, not corporate goals. The Amoco Foundation had traditionally given money to a host of causes, from the arts to medical research. In 1992, Amoco decided to focus philanthropy in just two areas, education and inner cities. American business executives have increasingly embraced this concept, often called strategic philanthropy. Strategic philanthropy simply involves ongoing consideration of how corporate giving ties into the firm’s need to attract good employees, enthusiastic investors, and loyal customers. As long as corporate philanthropy has a business interest, companies have a legitimate role to play in addressing social problems, and will deplo...
