Only 10% of Philanthropic Donations in Israel Come From Public Companies, Study Finds

A market survey conducted by Zoooz, which manages a philanthropic database of the Israeli business sector and provides philanthropic advisory services to companies in Israel and abroad, points to a low level of philanthropic engagement among publicly traded Israeli companies.

According to the survey, in 2017, only 210 of the 540 companies listed on the Tel Aviv Stock Exchange (TASE) made philanthropic donations, and just 90 companies published a corporate social responsibility (CSR) report. Total philanthropic contributions by public companies that year amounted to NIS 780 million.

Zoooz notes that this figure represented a decline of approximately 5% compared with the preceding period.

Why Do Most Public Companies Avoid Philanthropy?

Shlomi Turgeman, CEO of Zoooz, identifies several reasons for the limited participation. “Only about 40% of companies listed on the Tel Aviv Stock Exchange donated more than NIS 100,000 to the community in 2017,” he said.

Among the key explanations:

• No regulatory obligation: Unlike some countries, Israel does not require public companies to donate to the community.

• Lack of incentives or penalties: There is no official CSR or philanthropy rating on the stock exchange, nor any soft sanctions for companies that refrain from donating.

• Conservative economic philosophy: Many company executives adhere to the view that a firm’s sole responsibility is to maximize shareholder value. Under this approach, a company’s social contribution is limited to paying taxes, employing workers, and developing products.

The study also found that some companies are interested in donating but lack practical guidance. “Many firms do not know who to donate to or how to structure philanthropy in a way that aligns with their brand values,” Turgeman said.

Shareholders, Dividends, and Corporate Giving

Another barrier identified in the survey is the belief among senior executives that philanthropic decisions should be left to shareholders.

“Many managers of public companies believe it is the shareholders’ right to decide what to do with their dividend,” Turgeman explained, “and that the company should not engage in philanthropy at the shareholders’ expense.”

Public Companies Account for Just 10% of Donations

The limited role of public companies becomes more apparent in the broader context of Israeli philanthropy. Total philanthropic donations in Israel in 2024 were estimated at approximately NIS 7.5 billion.

Of this amount, only about 10% originated from public companies traded on the Tel Aviv Stock Exchange.

Countries That Mandate Corporate Giving

While Israel relies on voluntary philanthropy, a small number of countries have introduced mandatory models:

• India: The first country to legislate compulsory corporate philanthropy, requiring qualifying public companies to allocate 2% of net profits to social causes.

• Mauritius: Imposes a 2% “social tax,” directed to a government-approved fund for social and environmental projects.

• Indonesia: Requires companies operating in the natural resources sector to allocate budgets for social responsibility initiatives.

From Donations to Disclosure: The Global ESG Shift

In most developed markets—including Israel, the United States, and the European Union—the regulatory trend has shifted away from mandatory donations toward transparency requirements.

Under the ESG (Environmental, Social, and Governance) framework, companies are not required to donate a fixed amount, but must publicly report their social and environmental activities to investors and the public.

Zoooz’s research shows that financial institutions and banks lead philanthropic activity among Israeli public companies, followed by high-tech and industrial firms.

“In recent years, philanthropy trends have increasingly been shaped by pressure from foreign investors and international markets,” Turgeman said. “Companies that fail to report their social and environmental impact in the future may find it increasingly difficult to raise capital.”