The UK’s biggest companies have almost doubled their donations to charities over the last five years, but most people are unaware of their work in this area, according to new research.

The FTSE 100 gave £2.5bn to good causes in 2012, a £1.2bn rise since 2007 – despite the economic downturn.

However, consumers are largely unaware of this commitment, people thinking that just over a third (36%) of the FTSE 100 make donations to charity every year when in reality nearly all of them (98%) do.

The report also shows that younger people are a lot pickier when it comes to the companies they choose to do business with.

Nearly two-thirds (65%) of 18 – 24 year olds are more likely to buy a product or service from a company that makes donations to charity. This is compared to 51% of the general public.

The report, Corporate Giving by the FTSE 100, calls for a more consistent way for companies to report and measure their giving so they can be clearer and more vocal about their work with charities.

It also asks them to integrate a clear social purpose into the core of their business and increase their participation in employee giving schemes.

The research commissioned by the Charities Aid Foundation (CAF), which helps people and businesses support the causes they care about, and provides financial services designed for the charitable sector, also shows that 45% of people would be more inclined to work for a company that donates to charity, or 61% among 18 – 24 year-olds.

The report also found that the public are misinformed about which businesses do the most for charity.

When people were asked to choose the top three most generous sectors, Consumer Services and Consumer Goods were by far the most popular. But when ranked in terms of total donations, these industries were 5th and 6th on the list after Healthcare, Basic Materials, Financials and Telecommunications.

It also showed:

The average donation by the FTSE 100 has trebled since 2007 from £1m to £3m

Donations to charity by the FTSE 100 are increasing at a faster pace than their pre-tax profits

73% of people think companies should be more open and transparent about their corporate responsibility

61% say corporate responsibility is just a PR exercise

69% think that businesses have an obligation to support the local community in which they operate

44% think that businesses have an obligation to donate to charitable causes.

John Low, chief executive of the Charities Aid Foundation, said: “The way businesses work with charities and their local communities is becoming increasingly important, especially as younger generations are influenced more and more by the way in which they operate.

“I often hear stories that hopeful graduates look into the charitable work of a company directly after browsing the jobs pages – this is becoming an increasingly important factor when it comes to career choices.

“We’ve seen a growing number of brands putting their ethical aims and values at the heart of their businesses, and many have been hugely successful, particularly among a younger age group.

“We now need all companies to be more transparent and vocal about the great work they’re already doing for charities across the country.

"Why not shout louder about the remarkable growth in corporate charitable giving in spite of difficult economic conditions.

“This will begin to restore public trust in businesses after so many setbacks.”

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