During the 1990s, there has been an increasing awareness that support for cultural activities must extend beyond traditional public sector mechanisms. Government grants and other programs of support are wide ranging but they are under increasing pressure from an expanding cultural sector and its activities. To supplement the use of public funding in the cultural sector attention is becoming more focused on the private sector - and especially the corporate sector - as a source of additional financial assistance through both donations and business sponsorships.

This report is concerned mainly with findings of a national survey on the extent and nature of business sponsorship of cultural activities - that is, a commercial arrangement whereby a business purchases promotional benefits from a cultural organization. Information on other sources of support, such as grants and donations, were not sought in the survey but are discussed in the latter part of the report.

Business sponsorship has been highlighted over the past few years as being a critical factor in the ongoing viability of the cultural sector going hand in hand with audience and market development. Commercial partnerships with business through sponsorship arrangements are becoming an important feature of fundraising ventures and as competition for the business dollar increases it is important that the cultural sector has the knowledge and the skills to capitalize on the opportunities that occur in the marketplace.

The survey found that, during the 1993-94 financial year, 2,288 businesses out of a possible 474,038 sponsored a cultural activity. Sponsors comprised almost 10 percent of all big businesses, 6.5 percent of all medium business and 0.3 percent of all small businesses. The value of this support totalled $31.2 million. Such a result indicates that business is involved in commercial sponsorship of the cultural sector but there is room for increased support.

Cultural organizations need to recognize the potential that exists in the marketplace and capitalize on existing opportunities. For example, the survey showed that large business (200 or more employees) is the major contributor to the cultural sector, providing $21.5 million - however, only 235 large businesses out of a possible 2,428 businesses were involved. The average value of these sponsorships was some $90,000. By comparison there were 448 medium businesses (50-199 employees) out of 6,847 businesses which provided $6.1 million - an average of some $14,000. Based on these figures, it would seem that large business provides the most dollars but that it is a smaller market to work within and highly competitive. Medium size business has a broader base to work from but the value of the sponsorship dollar is not as great.

The results from small business (0-49 employees) were disappointing, with less than 1 percent having an involvement. It must be remembered, however, that around 70 percent of small businesses are tiny enterprises with fewer than five employees and very limited capacity to be involved in marketing or promotional activities.

Nevertheless, 1,605 small businesses did sponsor cultural activities to a total value of $3.6 million. This suggests that for community based organizations, there is potential to enter into sponsoring partnerships with small business.

The profile of sponsors is also interesting. The Finance and Insurance Industry (banks, building societies, insurance companies) was the most prominent industry, contributing a total of $7 million or 22.4 per cent of total arts and cultural sponsorship while Communication Services (postal, courier, and telecommunications businesses) entered into the most valuable sponsorship deals - on average $305,750.

CONTENTS
1. Introduction.

2. Main features.

3. Business sponsorship of cultural activities: a statistical overview:

Table 3.1 Sponsorship of arts and cultural activities by business size.
Table 3.2 All businesses involved in the sponsorship of arts and cultural activities: number and value of sponsorship.
Table 3.3 Proportion of all businesses involved in the sponsorship
Table 3.4 All sponsors of arts and cultural activities: value of sponsorship as a proportion of total expenses and operating profit before tax.
Table 3.5 Business operations and performance characteristics of all businesses involved in the sponsorship of arts and cultural activities.
Table 3.6 Large businesses involved in the sponsorship of arts and cultural activities: number and value of sponsorship.
Table 3.7 Large businesses: proportion involved in the sponsorship of arts and cultural activities by industry.
Table 3.8 Large businesses sponsoring arts and cultural activities: value sponsorship as a proportion of total expenses and operating profit before tax.
Table 3. Large sponsor units: business operations and performance characteristics.
Table 3.10 Medium sized businesses involved in the sponsorship of arts and cultural activities: number and value of sponsorship.
Table 3.11 Medium sized businesses: proportion involved in the sponsorship of arts and cultural activities by industry.
Table 3.12 Medium sized businesses sponsoring arts and cultural activities: value of sponsorship as a proportion of total expenses and operating profit before tax.
Table 3.13 Medium sized sponsor units: business operations and performance characteristics.

4. Case study data: summary of responses.

Table 4.1 Sponsors of arts and cultural activities: types of activity sponsored.
Table 4.2 Sponsors of arts and cultural activities: other sponsorship involvements.
Table 4.3 Sponsors of arts and cultural activities: value of all sponsorships.
Table 4.4 Whether sponsor units received benefits other than advertising or promotion from the sponsorship.
Table 4.5 Sponsor units that received benefits other than advertising or promotion from the sponsorship: types of additional benefits received.

5. Donations:

Table 5.1 Cash donations to cultural organizations on the Register of Cultural Organizations, 1993-94.

6. Australia Council survey on corporate support.

7. Government funding of arts and culture.

Table 7.1 Government funding of cultural facilities and services, 1993-94.

Explanatory notes.
Glossary of Terms.
Appendix:
Response to the arts and cultural sponsorship question on the Economic Activity
Survey form and the follow-up, telephone survey.